Uniswap Community Approves $165 Million Funding Plan for Uniswap Foundation

Uniswap UNI $6.77 24h volatility: 3.3% Market cap: $4.06 B Vol. 24h: $385.49 M

Key Notes:

* Uniswap community members voted in favor of two governance proposals to activate the much-awaited “fee switch”.

* The largest allocation, which is $95.4 million, will support ecosystem grants to foster growth and innovation.

* The activation of the fee switch will further enhance the value proposition of UNI token holders while reshaping the platform’s revenue distribution model.

Uniswap (CRYPTO: UNI) price has registered strong gains of 8% surging to $7 as the UNI community members voted in favor of two governance proposals. The proposals are set to activate the much-awaited “fee switch”.

The vote on the two proposals comes after the largest allocation, which is $95.4 million, will support ecosystem grants to foster growth and innovation. Additionally, $25.1 million is earmarked for operational expenses, while $45 million will fund liquidity incentives.

The vote on the two proposals comes after the Uniswap Foundation unveiled a two-year $165 million funding plan.

Crypto analyst World of Charts noted that Uniswap price is showing strong signs of a potential breakout as it challenges the upper range of a falling wedge pattern.

A successful breakout from this technical formation could mark the start of a significant recovery for the decentralized exchange token. As shown in the below chart, the UNI price can further rally to $20 and beyond.

Uniswap Price Challenges Key Resistance Level as Breakout Potential Rises

However, if the sellers manage to defend the critical resistance zone, it could indicate more selling pressure and the possibility of a retest of the lower support levels.

"Breakout potential is rising as Uniswap price stalls at the upper range of the wedge. A breakout above the wedge can propel UNI to new highs, with the first resistance at $10 and the next at $20."

On Wednesday, the Uniswap community gave a go-head to the $165 million two-year funding plan for the Uniswap Foundation.

These funds will be distributed after the fee conversion process, channeling protocol revenue directly to UNI token holders. Furthermore, it will also ensure alignment with the community’s goals and interests.

“This vote marks the beginning of our community’s next era as we continue to iterate on Unchained Together,” said Uniswap Foundation in a statement.

The two proposals, which are part of the “Uniswap Unleashed” plan, were approved by the Uniswap community members.

One proposal is focused on providing liquidity incentives for Unichain, a Layer 2 scaling solution for the Uniswap ecosystem. The second proposal aims to streamline the process of distributing protocol legal fees to UNI token holders, commonly known as the ‘fee switch’.

The implementation of the fee switch would come once after the Uniswap Foundation decides to introduce the necessary legal steps required to distribute the protocol legal fees to the governance members.

The proposal reads:

“If adopted, this step would pave the way for the potential introduction (or re-introduction) of a governance proposal for delegators to earn Protocol revenue.”

The fee switch would allocate a portion of Uniswap’s protocol revenues currently earned by liquidity providers directly to UNI token holders.

This delayed activation has been a longstanding point of contention within the Uniswap community, particularly after previous governance votes failed to implement the feature.

The decentralized Uniswap protocol generates revenue of $1 billion in annualized fees. The activation of the fee switch will further enhance the value proposition of UNI token holders while reshaping the platform’s revenue distribution model.See More: Top 5 Crypto Influencers To Follow In 2023