Uniswap, the most widely utilized decentralized exchange on the Ethereum blockchain, released a governance token called UNI on Sep. 16. The protocol gave away 400 UNI to every ETH address that used the exchange prior to Sep. 1.
At a price of $3 per token, 400 UNI is worth $1,200, which coincidentally is the same amount as the U.S. stimulus check. Currently, UNI is trading at $2.55 on Uniswap, down slightly over the past several hours.
When UNI first launched, it traded at $1.76. Depending on where users sold their UNI, the 400 UNI would range between $704 to $1,464.
“400 UNI are claimable by each address that has ever called the Uniswap v1 or v2 contracts. This includes ~12,000 addresses that have only ever submitted failed transactions — love you guys,” the Uniswap team said.
Binance, Coinbase Pro, and FTX listed UNI within five hours since its launch.
What UNI is And Why Uniswap Launched A Governance Token
The Uniswap team planned the launch of a governance token for a long time.
A governance token for a decentralized protocol like Uniswap could provide various benefits. There are two main benefits; it allows the protocol to be led by the public and secures the project’s stability through vested tokens.
When a project revolves around a governance token, holders of the tokens could vote on potential events that could change the protocol’s trajectory. A governance token gives the public the authority to establish the direction of the project.
“Having proven product-market fit for highly decentralized financial infrastructure with a platform that has thrived independently, Uniswap is now particularly well positioned for community-led growth, development, and self-sustainability,” the Uniswap team said.
According to data from Cryptofees.info, Uniswap trades are responsible formore than $1 million worth of fees every day. That is more than Bitcoin, Binance Coin, Monero, and Litecoin.
Ethereum processes $4.25 million in fees per day, which means nearly 25% of the fees come from Uniswap.
The official UNI release says that 21.51% of the token’s supply would be distributed to team members and future employees. The tokens are locked with 4-year vesting, meaning that the team members could only receive the tokens over a span of four years. A stable compensation system could stabilize the project’s long-term development.
The Timing Of UNI Release Is “Perfect” But YFI Creator Says “Meh”
Andre Cronje, the creator of the Yearn.finance protocol, says he feels mixed about UNI’s launch.
YFI became the biggest DeFi token on Ethereum within a few months after its launch. Its transparent and decentralized launch won over an active community.
Cronje said the launch itself was perfect. It was unexpected, retrospective, and was transparent. But the developer said he feels the launch was a response to SushiSwap, a potential competitor to Uniswap.
“Kinda meh about the UNI launch. The launch itself is perfect, surprise launch and retrospective. Exactly how it should be done nowadays But I can’t help but feel that the launch was simply in response to SUSHI. Never let other people set the pace for you, move at your own pace,” he said.
The launch also comes around two weeks after Uniswap surpassed Coinbase Pro in daily volume. It was the first time a decentralized exchange on Ethereum exceeded a top centralized crypto exchange in volume.