Uniswap has proposed a significant overhaul of its tokenomics and governance in a plan dubbed ‘UNIfication’. The initiative aims to activate protocol fees, burn UNI tokens based on trading activity, and reduce the circulating supply. These measures are designed to align UNI’s value with active use and create greater sustainability for the ecosystem. 🤝 A key aspect of the proposal is a one-time 100 million UNI burn from the treasury, representing fees collected since 2020. This burn will decrease the circulating supply by approximately 16%, to approximately $525 million after the reduction. To incentivize more usage and increase token value, Uniswap is introducing new auction mechanisms where traders can bid for discounted trading fees, with the UNI used in these auctions then being burned. The revenue generated through Unichain, Uniswap’s Layer 2 blockchain, will also contribute to the burn mechanism. 💰 🧠 The proposal merges Uniswap Labs and the Foundation into one entity. This unified entity will oversee governance and development under a single framework. The plan also eliminates fees collected from the front-end interface, wallet, and API, instead relying on protocol-level adoption. Starting in 2026, a quarterly growth budget from the treasury will fund incentives for community initiatives, development, and continued growth of the ecosystem. 📈 Following the proposal’s release, UNI saw an immediate surge in price, gaining over 40% within hours as investors reacted favorably to the planned fee activation and supply reduction. This significant price jump reflects strong investor interest in the planned changes, especially considering recent regulatory shifts in the United States that have eased restrictions on protocol-level governance. 🌎 The proposed changes seek to place the two revenues directly into the hands of token holders, ensuring sustainable growth for the ecosystem.