Uniswap’s new layer 2 blockchain, Unichain, has the potential to greatly benefit Uniswap Labs and the project’s token holders. It could enable them to earn nearly $500 million annually in fees that would have otherwise been paid to the Ethereum network.
According to Michael Nadeau, founder of DeFi Report, at Unichain’s launch, $368 million previously paid to Ethereum validators would now go directly to Uniswap Labs and UNI token holders. Uniswap Labs could also seize all Maximum Extractable Value (MEV) on Unichain by owning all validators on the network, preventing Ethereum validators from scalping MEV.
Nadeau estimated that MEV accounts for about 10% of the total fees paid on Uniswap. Uniswap’s liquidity providers could also benefit from the new blockchain by participating in the settlement and capture of MEV through staking.
After Unichain’s launch, Ethereum validators and ETH token holders are expected to lose the most, with less ETH burned and fewer fees returning to the blockchain. Uniswap has generated over $1.3 billion in trading and settlement fees across different chains in the past year.
Uniswap, the largest decentralized exchange by volume, launched Unichain on October 10 to provide faster, cheaper transactions and improved interoperability between various blockchain networks. The launch received mixed reactions from DeFi experts, with some questioning the necessity of a new layer 2 blockchain.
Proponents believe that Unichain, designed specifically for DeFi protocols, will offer a cleaner user experience, more concentrated liquidity, and fewer issues with fragmentation across chains. However, skeptics, including Ethereum co-founder Vitalik Buterin, have criticized Uniswap’s idea of a layer 2 blockchain.
Buterin argued that Uniswap’s main value proposition is fast transactions without much thought, making a separate chain or rollup unnecessary. He suggested that having a copy of Uniswap on every rollup would achieve the same goal.
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