Uniswap (UNI), the governance token of the decentralized exchange, has witnessed a remarkable surge, climbing by 46% to trade above $17. This surge brings UNI to levels last seen in January 2022. Accompanying UNI’s price rally is a staggering 120% leap in trading volume over the last 24 hours, totaling $1.18 billion. Moreover, UNI’s market capitalization has soared by 44% in the past week to $9.4 billion, positioning it as the 16th-largest cryptocurrency by market capitalization.
This surge follows a proposal by the Uniswap Foundation to upgrade the protocol’s governance for fee redistribution, with a focus on increasing community involvement. The proposal aims to distribute protocol fees to UNI token holders, enhancing their governance role within the Uniswap ecosystem. The proposal, announced on February 23, seeks to reward UNI holders who have staked and delegated their tokens. It involves enhancing the UniswapV3Factory contract to enable permissionless and programmatic collection of protocol fee revenue.
Snapshot voting for the proposal began on March 1 and will continue until March 7. The Uniswap Foundation reports significant community support for the proposal, with 55 million UNI, representing 100% of votes, in favor of the upgrade. Data from Lookonchain reveals whale accumulation of UNI tokens worth over $12.5 million in the past 48 hours. Additionally, Token Terminal data indicates a surge in Uniswap’s network activity, suggesting increasing adoption of the ecosystem and subsequently driving up demand for UNI tokens.
UNI’s price has surged by over 143%, from $7 on February 23 to an intraday high of $17.03 on March 6. The relative strength index (RSI) at 87 validates buyer dominance in the market, although it also signals potential overbought conditions and a possible trend reversal. Uniswap’s recent surge to a two-year high is fueled by strong community support for a fee redistribution proposal, indicating a significant shift in governance dynamics within the Uniswap ecosystem.