- Uniswap implemented an Interface Fee to fund further development.
- UNI token’s price remained stable, but a decrease in network growth may affect its future trends.
Amidst the ever-growing interest in the cryptocurrency sphere, catalyzed by the resurgence of Bitcoin, DeFi protocols like Uniswap[UNI] have been reaping the benefits.
Uniswap, in a strategic move, introduced the Interface Fee, an initiative spearheaded by founder Hayden Adams to fund ongoing development. This fee aimed to collect a daily charge from traders utilizing Uniswap’s web interface and wallet.
Realistic or not, here’s UNI’s market cap in BTC’s terms
New fee, new feat
Uniswap’s introduction of the Interface Fee marked a significant shift in the platform’s revenue generation strategy. Hayden Adams, the founder of Uniswap, rolled out this initiative, explicitly stating that it would be used to support ongoing development.
Uniswap’s decision to implement the Interface Fee was a notable development. Compared to centralized exchanges, the fee was relatively high, with a rate of 0.15%. For context, major centralized exchanges, such as Binance, impose a 0.1% maker and taker fee.
Metamask Swaps, a popular wallet service, charges an even higher 0.875% interface fee.
Despite the relatively high fee, Uniswap saw significant trading volume and generated substantial fees in the past week and managed to collect $500,000 in terms of fees during this period.
Uniswap Labs pulled in $500k in week one from their new Interface Fee.
Not too shabby. pic.twitter.com/0L3INEwEjo
— Yano 🟪 (@JasonYanowitz) October 26, 2023
Some more developments
Token terminal’s data provided insights into the impact of the Interface Fee. It indicated a notable 34.2% increase in active users on the Uniswap platform over the previous week. The influx of users was a promising sign, suggesting that the fee had not deterred traders.
However, alongside this increase in activity, there was a less favorable trend. The number of core commits on the protocol had declined. This decrease raised concerns about the platform’s ongoing development and its ability to maintain a robust and evolving ecosystem.
Source: token terminal
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Coming to the state of the UNI token, it was seen that the price of the token had not seen much growth over the past week. At press time, it was trading at $4.09.
Its network growth had plummeted as well, signaling that new addresses were not transferring a lot of UNI. A lack of interest in UNI from new addresses could negatively affect the price movement of UNI going forward.
Source: Santiment