Uniswap Price Could ‘Go Parabolic’ Due To Supply Shock, Says CryptoQuant CEO

Summary

Uniswap (UNI) experienced a significant price increase following the announcement of a new governance proposal, “UNIfication,” by Uniswap Labs founder Hayden Adams. This proposal aims to activate protocol fees and implement token burns, which has sparked discussions about a potential supply shock in the market.

What Happened

On Tuesday, Uniswap Labs founder Hayden Adams introduced “UNIfication,” a comprehensive governance proposal designed to activate protocol fees. This initiative includes routing these fees into coordinated token burns, which has generated a highly positive sentiment around the Uniswap protocol. CryptoQuant CEO Ki Young Ju commented on the potential for a supply shock, suggesting that if the fee switch is activated, Uniswap could experience significant price increases.

Adams expressed his excitement about this proposal, framing it as a major step forward after years of legal constraints that limited Uniswap Labs’ participation in governance. He noted that the regulatory environment has shifted, allowing for this new framework to be proposed.

The plan outlines several key economic changes, including the burning of UNI tokens based on protocol usage, directing Unichain sequencer revenue towards the same burn sink, and an immediate destruction of 100 million UNI tokens to account for potential fees that could have been burned if the fees had been activated at the token’s launch.

Additionally, new mechanisms such as “protocol fee discount auctions” and an “aggregator hooks” architecture in version 4 (v4) are proposed. These changes aim to improve liquidity provider (LP) outcomes and capture fees from external liquidity sources. To further enhance distribution and adoption, Uniswap Labs plans to eliminate fees on its interface, wallet, and API.

The proposal represents a consolidation of Uniswap’s development, growth, and fee policy under a single structure, while governance retains control. The price of UNI reflected this positive sentiment, with a notable spike to multi-week highs, indicating a governance-driven rally distinct from broader market trends.

Impact on the Crypto Market

• The introduction of the UNIfication proposal could lead to increased interest and investment in Uniswap, potentially driving up the price of UNI.
• The activation of protocol fees and token burns may create a supply shock, impacting the availability of UNI tokens in the market.
• The governance-driven nature of the recent price movement underscores the importance of governance proposals in influencing token prices and market sentiment.
• Changes to fee structures and the introduction of discount auctions may attract more liquidity providers, enhancing the overall health of the Uniswap ecosystem.
• The consolidation of development and fee policy under one aligned structure could streamline decision-making and foster innovation within the Uniswap platform.

Updated: 11/11/2025, 6:00:18 PM