Uniswap’s UNI token surged approximately 19% in the last 24 hours as on-chain voting commenced on a significant governance proposal aimed at activating protocol fees and implementing a long-anticipated UNI burn mechanism.
UNI started to rise shortly after the voting period opened at 03:50 UTC on Dec. 20, based on Uniswap governance data. A one-day UNI-USD chart from TradingView indicates the most pronounced segment of the rally occurring during the early hours of the voting timeframe, with the price escaping from the $5.40–$5.50 range and continuing to climb throughout the day, accompanied by increasing trading volume.
By around 19:30 UTC, UNI was priced near $6.27, marking an approximate 19% increase on the day. This movement was notable against a generally steady broader market, with Bitcoin stabilizing near $88,300 and Ethereum trading slightly lower at around $2,976. Overall, the cryptocurrency market capitalization rose about 1% over the same period, highlighting UNI’s relative strength.
The vote focuses on an extensive governance proposal dubbed “Unification,” reflecting its objective of synchronizing Uniswap’s economic incentives, governance framework, and developmental activities under one cohesive system. If approved, the proposal would introduce protocol fees across Uniswap v2 and certain v3 pools, channeling those fees into a programmed mechanism that burns UNI tokens.
The proposal also incorporates a retroactive burn of 100 million UNI from the treasury, aimed at mirroring the amount that might have been burned had protocol fees been implemented from Uniswap’s early days. Other components would allocate Unichain sequencer fees into the same burn mechanism and introduce new auction-based systems aimed at internalizing MEV while enhancing liquidity provider returns.
In addition to fee activation, the proposal seeks to formalize a stronger operational alignment between Uniswap Labs, the Uniswap Foundation, and on-chain governance. As part of the plan, Labs would concentrate on protocol development and growth, while eliminating fees from its interface, wallet, and API. Development and ecosystem initiatives would receive funding through a governance-sanctioned growth budget.
Despite years of discussions around activating protocol fees, prior efforts to do so have faltered due to regulatory uncertainties and disagreements regarding incentive structures. The initiation of formal on-chain voting seems to have sparked renewed interest from the market, with traders positioning themselves around the prospect of direct value accrual related to Uniswap’s leading trading volumes.
Preliminary voting data indicated significant backing for the proposal, although the vote remains open until 6:14 p.m. UTC on Dec. 25. While the outcome is still pending, the timing of UNI’s surge suggests that the market is responding positively to the commencement of the governance process and the potential for a transformative change in how value is returned to UNI holders.
