Uniswap The foundation has submitted a proposal to update the protocol’s governance and fee mechanism. The offering aims to incentivize UNI token holders to delegate and stake their tokens and reward them with a share of protocol fees.
The proposal titled “UF-01: Uniswap Protocol Governance and Fee Mechanism Upgrade” was submitted to Snapshot voting on March 1, 2024 at 11:00 Turkish time. Currently, the bid is leading by accepting a 100% raise at 10 million UNI (about $300 million). Voting will remain open until 02:30 on March 7, 2024.
This upgrade stands out as UF proposes a significant change to the Uniswap protocol. UF aims to reward UNI token holders and encourage delegation by changing the protocol’s fee mechanism.
Currently, the Uniswap protocol charges a 0.3% fee for each transaction, and this fee is distributed to token holders who provide liquidity to trading pairs. According to UF’s proposal, 0.05% of the fee will be rewarded to UNI token holders and this reward will be distributed through a new smart contract called Delegation Rewards Contract (DRC).
DRC will offer a user-friendly interface that will allow UNI token holders to manage and stake their delegations. There is also the Delegation Rewards Oracle (DRO) which will track voting results and delegation participation.
This upgrade is expected to create a positive feedback loop for Uniswap governance. UF claims that by encouraging UNI token holders to transfer and stake their tokens, it will increase the security of the protocol and increase the value of the UNI token.
The proposal details the technical details of the upgrade and the steps required to implement it. The upgrade will be completed with a Snapshot vote on March 1, 2024, and an on-chain vote on March 8, 2024.
This proposal from UF aims to strengthen the governance of the Uniswap protocol and the interests of its users.
