Uniswap Approves UNIfication as Fee Switch and UNI Burns Begin

• UNIfication passed with 99.9% support, approving Uniswap’s largest governance and economic overhaul to date.
• Protocol fee switch activates UNI burn model, linking trading and Unichain fees directly to supply reduction.
• Proposal consolidates operations under Uniswap Labs and adopts Wyoming DUNA legal structure.

Uniswap governance has approved the UNIfication proposal, marking a major structural and economic update for the decentralized exchange protocol. The on-chain vote closed on Thursday with 99.9% support, according to a public confirmation from Uniswap founder Hayden Adams. More than 125 million UNI tokens were cast in favor of the proposal, while only 742 UNI were recorded against it, comfortably exceeding the required governance quorum.

Introduced in November by Uniswap Labs and the Uniswap Foundation, UNIfication represents the most extensive governance overhaul since the protocol’s launch. The proposal combines long-planned economic mechanisms with organizational restructuring and legal alignment, setting a new framework for how Uniswap operates and captures protocol-level value.

Protocol Fee Switch and Token Burn Mechanics

A central component of UNIfication is the activation of the protocol fee switch. Under this model, a portion of trading fees generated on Uniswap will no longer be distributed exclusively to liquidity providers. Instead, part of those fees will be retained by the protocol and used to burn UNI tokens, reducing the circulating supply.

In addition, net sequencer fees generated by Unichain will be directed into the same burn mechanism. This design directly links protocol activity to token supply changes, with higher usage resulting in a greater amount of UNI being removed from circulation.

Following a two-day governance timelock, Uniswap is scheduled to carry out a one-time burn of 100 million UNI. This amount represents an estimate of the number of tokens that would have been burned historically if the fee switch had been active since the protocol’s inception.

Organizational Consolidation and Legal Framework

Beyond token economics, the proposal restructures Uniswap’s internal organization. Responsibilities previously split between the Uniswap Foundation and Uniswap Labs will be consolidated under Uniswap Labs. As part of this change, interface, wallet, and API fees charged by Labs will be eliminated.

UNIfication also establishes a recurring growth budget funded in UNI, designed to support ongoing protocol development rather than short-term incentive programs. To align governance and operations, the proposal introduces a new legal structure based on Wyoming’s DUNA framework, bringing Uniswap Labs, the Foundation, and on-chain governance under a single legal entity. The governance package further includes Protocol Fee Discount Auctions, intended to balance liquidity provider returns while maintaining protocol-level fee capture.

Governance Context and Regulatory Backdrop

Several large UNI holders supported the proposal, including Jesse Waldren, Kain Warwick, and former Uniswap engineer Ian Lapham. The vote comes after years of regulatory scrutiny facing decentralized finance during the tenure of former SEC Chair Gary Gensler.

Under the current administration of President Donald Trump, U.S. regulators have withdrawn multiple enforcement actions against crypto firms, reshaping the environment in which governance decisions like UNIfication are executed.