100M Tokens Set to Burn as DEX Governance Approves Major Protocol Upgrade

Source: CoinTribune Original Title: 100M UNI Set to Burn as Uniswap Governance Greenlights UNIfication Original Link: https://www.cointribune.com/en/100m-uni-set-to-burn-as-uniswap-governance-greenlights-unification/ With the decision now in place, a major DEX’s governance has approved a significant protocol proposal, paving the way for substantial changes in how the native token interacts with the protocol and how value is retained within the system. The approval reflects a collective push among the governing community to implement a broader redesign of the protocol’s economic model, focusing on capturing value directly at the protocol level rather than relying on limited revenue generated through the platform interface.

Resounding Governance Support

The protocol founder shared the final vote results, confirming that the proposal passed by a wide margin. The measure received strong support, with 125,342,017 votes in favor and only 742 against. Total participation comfortably surpassed the quorum of 40 million tokens, reflecting a clear consensus within the community and validating the outcome of the governance process.

The proposal, submitted jointly by the protocol’s core development team and foundation, sets out a long-term vision for the ecosystem. Under this framework, the protocol will drive the burning of native tokens through its activity, while the development team will concentrate on expanding the platform.

Following a roughly two-day vote timelock, 100 million tokens will be taken out of the treasury, roughly matching the total that would have been burned if fee collection had been active from the start. At the same time, fee switches will be activated, front-end fees will be turned off, and the team will focus fully on protocol-level improvements.

Scenarios for Token and Liquidity Provider Dynamics

Despite the overwhelming support, some industry voices have raised concerns about possible side effects. Some analysts pointed out that liquidity providers (LPs) could face reduced profitability under certain scenarios. For instance, some v3 pools might become unprofitable, prompting LPs to shift to v4 pools or exit the ecosystem altogether. This could result in a decline in total value locked (TVL) and put downward pressure on fees for v3 pools.

Two key scenarios illustrate how different outcomes could affect liquidity providers and the protocol:

• Should the protocol take no action, the fee switch could generate very low returns, making it harder for LPs to earn profits and slowing overall activity. In this situation, the protocol could function largely as a routing layer with limited native liquidity.
• If the fee switch is applied to v4 pools and native tokens are distributed as incentives, LPs could either sell their tokens or remain as the primary beneficiaries, effectively turning the native token into a governance-driven rebate. Under this scenario, passive token holders may gain little or no advantage, raising questions about fairness in long-term token distribution.

Meanwhile, the market appears to be responding with optimism following the governance outcome. The native token rose 3% over the past 24 hours, building on a strong week in which it climbed more than 17%. While multiple factors could be influencing this movement, the surge may reflect growing investor confidence as the protocol gears up for a new phase of economic activity and broader adoption.