Uniswap founder Hayden Adams yesterday introduced his proposal to activate the long-awaited UNI fee-switch on the decentralized finance (DeFi) sector’s main alternate.
The proposal, Adams’ first to Uniswap governance, would successfully share swap charges with UNI token holders by way of a buy-and-burn system.
Extensively anticipated to move this time, the transfer would mark a major milestone for DeFi… however not everyone seems to be satisfied.
The proposal
The proposal would see a portion of charges, which presently go to liquidity suppliers (LPs), redirected to the buy-and-burn of UNI.
For many swimming pools, this may be a sixth of the overall charges, with a few of the decrease tiers coughing up 25%.
100 million UNI shall be burned to symbolize the quantity that “would have been burned if fees were on from the beginning.”
Sequencer charges from Unichain may even go in the direction of the UNI burn, whereas different options would look to earn charges on exterior swimming pools and seize MEV on the protocol.
The wildly unpopular front-end charges which have, thus far, made nearly $180 million for Uniswap Labs, shall be abolished.
> As a part of this, Labs will cease amassing charges on its interface, pockets, and API to supercharge distribution and adoption of the Uniswap protocol
llama didnt anticipate this ngl https://t.co/qErA9HPix3
— 0xngmi is hiring (@0xngmi) November 10, 2025
Regardless of a number of fruitless makes an attempt, the UNI fee-switch has but to make it throughout the end line.
Authorized worries have typically been cited as a purpose to carry again; Adams refers to this as “a hostile regulatory environment that cost thousands of hours and tens of millions in legal fees.”
The Trump Administration’s extra permissive regulatory panorama might have eased earlier nerves. Coming this time from founder Adams (who talks as if it’s a completed deal), it appears doubtless that the modifications shall be enacted after a complete of 22 days of governance proceedings.
New period for DeFi
Adams states the “proposal comes as DeFi reaches an inflection point.” In addition to the shift in regulatory method, he praises decentralized platforms’ “performance and scale,” tokens “going mainstream,” and institutional adoption among the many tailwinds pushing the sector ahead.
Uniswap is DeFi’s dominant decentralized alternate, with roughly $5 billion of whole worth locked (TVL) and over $100 billion of quantity prior to now 30 days.
In that interval, it raked in $109 million in charges which, at a minimal, would translate to $18 million of UNI tokens burned, or 0.3% of its $5.7 billion market cap.
Estimates utilizing annualized income put the quantity at $38 million month-to-month income. This may put the magnitude of the scheme between comparable efforts for PUMP and HYPE.
The concept is proving widespread amongst the DeFi group, with $30 billion liquid staking big Lido mulling comparable buybacks.
The “anti-cyclical” mechanism would enhance buybacks throughout bull markets and tighten the purse strings through the harder instances.
A proposal to implement an automatic LDO buyback mechanism is now dwell on the Lido DAO Discussion board.
Opinions concerning mechanism, proposed parameters and extra are welcome.https://t.co/Hve7cS405J
— Lido (@LidoFinance) November 11, 2025
Rivals, nonetheless, argue that the discount in swap charges going to LPs might result in an exodus of liquidity, worsening commerce execution and opening up the sphere to different exchanges.
Others nonetheless level out that “scammy” wash buying and selling swimming pools will develop into unviable with a portion of charges siphoned off, which might result in an additional drop in buying and selling exercise.
Extra extensively, although, supporters really feel that the transfer indicators a brand new period of confidence for DeFi.
Bankless’ Ryan Sean Adams summed up the second as Uniswap “[keeping] a promise” and “inject[ing] a little belief back into our jaded souls.”
‘A tragic day for DAOs‘
Adams’ proposal hasn’t fully escaped criticism, nonetheless. Whereas many have fun a long-awaited milestone, others have targeted on what the transfer means for decentralized governance at giant.
tbh, I am not so hyped by uniswap dropping the governance theater to re-centralize issues underneath Labs.
Uniswap DAO was a flawed and failed DAO however everyone seems to be clapping giving up on the decentralized governance mannequin sends a nasty sign.
Right now is a tragic day for DAOs. pic.twitter.com/dgM8gpeg26
— Marc ”七十 Billy” Zeller 👻 🦇🔊 (@lemiscate) November 11, 2025
Worries over the affect of enormous UNI stakeholders corresponding to a16z and Binance have typically led to accusations of decentralization theater.
Critics are pissed off with additional switch of energy to Labs, whose actions will not be ruled by token holders.
Below the proposal, Basis groups would transfer to legal-wrapper Labs, a transfer dubbed an admission that “DAOs are inefficient at governing and allocating resources.”
Adams states an “explicit commitment from Labs… ensuring Labs does not pursue strategies that conflict with token holder interests.” He insists, too, that Uniswaps’ “vision… has always been to minimize the need for it by relying on automation and protocol decentralization.”
Others posit that Uniswap by no means needed a token within the first place, solely launching UNI as a way to compete with 2020 rival SushiSwap.
The fee-switch proposal “basically revert[s] this, buy back and burn is the mostly [sic] simple, boring way to do so.”
