Uniswap is about to shrink UNI’s supply after the community overwhelmingly approved the “UNIfication” governance proposal, setting in motion a major tokenomics overhaul. By the numbers - The measure secured more than 69 million “yes” votes — comfortably above the 40 million-vote threshold required for passage. Quorum was met in under three days after voting opened on Dec. 20; the vote closes on Dec. 25. - Once a mandatory two-day timelock expires, the proposal is expected to go live: the protocol fee switch will be enabled on the Unichain mainnet and then rolled out across supported pools. What changes - A new automated buyback-and-burn mechanism will use protocol earnings (trading fees) to regularly purchase and burn UNI, tightening long-term supply dynamics. - To account for fees that “would have been burned if fees were on from the beginning,” the proposal calls for a one-time removal of 100 million UNI from the treasury. - A fresh incentive called Protocol Fee Discount Auctions is being introduced — designed to boost liquidity provider returns on trades. - Governance and operational roles will shift: responsibilities held by the Uniswap Foundation will move to Uniswap Labs. - The plan also establishes a growth budget of 20 million UNI per year to fund development, integrations and partnerships. Market reaction - UNI’s price jumped more than 25% since voting began, driven by retail buyers and increased activity from large holders. Still, the token has felt pressure from a broader crypto market downturn. At the time of writing, UNI traded at $6.17 on CoinGecko, down 1.3% over the past 24 hours. Why it matters UNIfication represents one of the most significant tokenomic adjustments in Uniswap’s history: it creates a predictable mechanism to remove supply, reallocates governance and operational authority, and implements new incentives aimed at strengthening liquidity. If implemented smoothly, these changes could materially affect UNI’s supply dynamics and the economics of participating in Uniswap pools. Read more AI-generated news on: undefined/news