According to PANews, the Uniswap Foundation has approved a significant investment plan worth $165.5 million to address the underperformance of Uniswap v4 and Unichain. Despite being launched over a month ago, Uniswap v4's total value locked (TVL) stands at only $85 million, while Unichain's TVL is a mere $8.2 million.
To stimulate growth, the foundation plans to allocate the funds as follows: $95.4 million for grants to developers, core contributors, and validators; $25.1 million for operational expenses, including team expansion and governance tool development; and $45 million for liquidity incentives.
The liquidity incentives are detailed as follows: $24 million will be distributed over six months to encourage liquidity migration to Uniswap v4, and $21 million over three months to boost Unichain's TVL from $8.2 million to $750 million.
The proposal has passed the initial temperature check phase but faces criticism. In contrast to Uniswap's approach, Aave and Maker have proposed token buybacks to align with token holders' interests. Aave plans a $1 million weekly buyback of AAVE tokens, while Maker intends to repurchase $30 million monthly. Critics argue that UNI token holders are not benefiting from the value generated, as Uniswap Labs has earned $171 million in front-end fees over two years without sharing with UNI holders.
The organizational structure of Uniswap is pivotal, with Uniswap Labs focusing on protocol development and the Uniswap Foundation driving ecosystem growth, governance, and funding initiatives. Critics also highlight issues such as high salaries for the core team, Gauntlet's role in executing liquidity incentives, and the establishment of a new centralized DAO legal structure (DUNA).
As a minor governance representative for Uniswap, I voted in favor of the proposal but remain concerned about the alignment of incentives with UNI holders' interests. Despite these concerns, I am a strong supporter of Uniswap and recognize its significant impact on the DeFi sector. The current growth trajectory of Uni v4 and Unichain is bleak, necessitating the introduction of incentives to foster development.
Future Uni DAO votes should focus on mechanisms for capturing value for UNI tokens.
