Uniswap Flips Fee Switch, Burns 100M UNI After Vote - Crypto Economy

CryptoEconomy · 2025-12-29T12:22:04+00:00

Uniswap implemented a governance proposal on December 27, 2025, to activate protocol fees and a UNI burn mechanism. The proposal includes a retroactive burn of 100 million UNI and adjusts LP fees in v2 and v3 pools to capture a portion for the protocol.

CryptoEconomy

2025-12-29 12:22:04

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Uniswap governance executed on December 27, 2025 a joint Uniswap Labs and Uniswap Foundation proposal to turn on protocol fees and route value into a UNI burn mechanism.

The document says Uniswap has processed nearly $4 trillion in volume and proposes a “retroactive burn” of 100 million UNI from the treasury, as if protocol fees had been active since the token’s launch. In Uniswap v2, with the fee switch enabled, LP fees would move from 0.3% to 0.25%, while the protocol would capture 0.05%. In v3, the protocol share would be configurable per pool and would start as a fraction of LP fees, depending on the tier.

The plan outlines a phased rollout, starting with v2 pools and a set of v3 pools that account for 80% to 95% of fees on Ethereum mainnet, before expanding to L2s, other L1s, and components such as PFDA and hooks, with further adjustments handled through governance.

Source: Uniswap Foundation.

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