Uniswap executed the destruction of 100 million UNI tokens on December 28, marking one of the largest token burns ever recorded in decentralised finance.
The burned tokens were valued at approximately $596 million at the time of execution, significantly reducing the protocol’s circulating supply.
The action followed the on-chain implementation of the “UNIfication” governance proposal, which passed with near-unanimous community support.
Voting data showed 99.9% approval, with more than 125 million UNI tokens cast in favour and only a handful opposing the measure.
Uniswap Labs confirmed the execution on social media, stating that the UNIfication framework had officially gone live on-chain.
The governance shift activates long-debated protocol fees, directly linking Uniswap’s revenue generation to token value capture.
Under the new model, protocol fees are now enabled on Uniswap v2 and selected v3 pools operating on Ethereum.
At the same time, Uniswap reduced interface fees to zero, aiming to balance user costs with long-term sustainability.
Revenues generated on Unichain will now be used to support recurring token burns after covering network and data availability costs.
This mechanism introduces a sustained deflationary pressure designed to reward long-term participation rather than short-term speculation.
Community figures backing the proposal said the changes reflect growing maturity in decentralised governance processes.
The Uniswap Foundation also announced a Growth Budget funded with 20 million UNI to continue developer grants and ecosystem incentives.
Foundation representatives said developer funding would continue uninterrupted despite the large-scale treasury burn.
Supporters argue the separation of burned and reinvested tokens demonstrates disciplined financial management.
Market participants said the move could influence how other DeFi protocols approach treasury management and fee distribution.
Analysts noted that deflationary mechanics may alter UNI’s supply dynamics over time, depending on trading volumes and protocol usage.
The decision signals a broader shift within DeFi toward sustainable value capture models rather than pure liquidity incentives.
At the time of reporting, Uniswap price was $6.25.