Key Takeaways:
- Uniswap sees a skyrocket in price following the announcement of long-awaited staking rewards.
- Proposal is set for a snapshot vote on March 1
The Uniswap Foundation, a non-profit organization supporting the growth of decentralized exchange Uniswap, is proposing a significant upgrade to the Uniswap Protocol Governance. This proposed upgrade aims to reward UNI token holders for their active participation in governance decisions.
The proposal, submitted by Uniswap Foundation’s governance lead, Erin Koen, seeks to address the issue of low engagement and “stale” delegation within the governance system.
The primary driver behind this proposal is to incentivize thoughtful and active delegation by directly tying delegation to protocol fees.
According to the proposal, UNI token holders who stake and delegate their tokens will be rewarded with a portion of the protocol’s fee earnings.
This incentive mechanism aims to strengthen and invigorate Uniswap’s governance, encouraging active participation and contributing to the protocol’s growth and success.
The proposal is set for a snapshot vote on March 1, followed by an on-chain vote on March 8. If approved, the upgrade will reward token holders with a share of the protocol’s fee revenue, creating a direct link between active participation and potential rewards.
The mechanism will be implemented through two new smart contracts designed to automate fee collection and distribute rewards to stakers based on their delegated UNI tokens.
This innovative approach aims to foster a more engaged community and attract new delegates to participate in Uniswap’s governance process.
Overall, the proposed upgrade to Uniswap Protocol Governance represents a significant step towards incentivizing active participation and strengthening the governance framework of the decentralized exchange.
It underscores Uniswap’s commitment to fostering a vibrant and participatory community while ensuring the protocol’s continued growth and success in the DeFi space.
UNI, Uniswap’s native token, grants governance power to holders for decision-making within the Uniswap DAO, the decentralized community overseeing the protocol.
According to Devin Walsh, Executive Director of the Uniswap Foundation, this upgrade will enhance the resilience of the governance system.
“The proposal aims to incentivize active and thoughtful delegation, ensuring the long-term success and sustainability of the Protocol,” Walsh said
“We’re grateful to collaborate with top-tier grantees like Scopelift, Gauntlet, Avantgarde, Agora, and more on this proposal’s components, believing their collective output is world-class.”
