Uniswap Labs has permanently burned 100 million UNI tokens valued at roughly $600 million, marking a major shift in the protocol’s economic design.
The burn was executed on December 27 as part of the on-chain implementation of the UNIfication governance proposal.
The initiative formally links Uniswap’s protocol revenue to the value of the UNI token through a buy-and-burn mechanism.
UNIfication was introduced in November 2025 and received overwhelming approval from governance voters on December 25.
Under the new structure, a portion of protocol fees will be used to repurchase and permanently remove UNI from circulation.
The change represents a move toward a deflationary token model rather than pure governance utility.
On Uniswap v2, liquidity providers continue to earn 0.25% per trade, with 0.05% now directed to the protocol.
On Uniswap v3, liquidity providers route either one-quarter or one-sixth of fees to the protocol, depending on the fee tier selected.
Supporters argue that repeated fee-funded burns could steadily reduce circulating supply over time.