The Uniswap Foundation has disclosed its financial status, revealing $41.41 million in fiat cash and stablecoins, along with 730,000 UNI tokens as of March 31, 2024. This transparency comes ahead of an on-chain vote on a proposal to activate protocol fees in V3 pools.
Financial Overview
The Uniswap Foundation, a nonprofit organization supporting the decentralized exchange’s growth, shared a detailed summary of its financials for the first quarter. The foundation holds $41.41 million in US dollars and stablecoins, which it plans to use for grant commitments and operating activities. Additionally, the foundation has earmarked 730,000 UNI tokens for employee awards.
Planned Fund Usage
The foundation intends to disburse $25.77 million through 2024 and 2025, with $2.94 million reserved for previously committed grants. Operating expenses will be covered with the remaining $12.7 million. The majority of grant disbursements in Q1 have been directed towards protocol developers and governance, with the rest allocated to innovation, research, and security.
Upcoming Fee Switch Vote
The Uniswap community will begin voting on Friday to decide whether to turn on protocol fees in V3 pools. Since its inception, Uniswap has generated $3.6 billion in fees, according to DeFiLlama. If approved, the fee switch will reward UNI token holders who have staked and delegated their tokens. However, activating this mechanism may benefit UNI holders at the expense of the protocol’s liquidity providers, who currently earn fees from token swaps.
Community Engagement and Governance
The proposal’s authors believe that the new fee mechanism will incentivize more active delegation and enhance engagement in the governance process. Previous attempts to activate the fee switch have failed, with the most recent attempt not passing the temperature check stage. Should the May 31 vote succeed, fees will not be turned on immediately. Uniswap’s governance lead mentioned plans to propose another upgrade to streamline the fee-setting process further.
As the Uniswap community prepares to vote on the fee switch proposal, the foundation’s financial disclosures highlight its commitment to transparency and effective fund management. The outcome of this vote could significantly impact the future governance and financial dynamics of the Uniswap protocol.
