[Discussion] Uniswap Liquidity Incentive Plan

Let’s keep in mind that founder, devs and VCs have way more information in their hands than us:
They know what will go in V3, and when it can be expected.
This information is so important at this point that there’s no doubt that it makes them able to take significantly better decisions for the protocol than us.
While I’m sure Uniswap’s future is decentralized, I’m ok with its present being partially centralized.

Let’s not forget that the only reason why we have UNI available to us today is Sushiswap.
UNIs wouldn’t have been dropped so early without this competition, this clearly wasn’t the initial plan.
But as far as I can tell, everything is working pretty well so far.
VCs interests are aligned with ours here, they can be trusted for the moment.


At the same time, I understand the Uniswap dev team for keeping everything about v3 under wraps.

Giving advance info to copycats/competition would hurt Uniswap at the moment.
Let them be stunned when v3 gets out :slight_smile:

I think it’s now safe to assume big delegates have been told to put incentivization on hold. Otherwise, they would reply. I’ve pinged them many times on Discord and here, and they keep quiet.

In the meantime, we are losing liquidity, but volume doesn’t follow that much.
Sushiswap has to use subsidies all the time, pretty much on every pair since they have the fee switch turned on (LPs get less by default).

Uniswap is still the default DEX for most new coins.
Recent example : The Graph / GRT. I think there’s literally 0$ liquidity on Sushi at the moment.


Yes I fully agree.
Even though the Sushiswap situation worried me at the beginning, it looks less of a major threat today.
Sushiswap will certainly survive, it will probably grow, but it doesn’t look like it will become the #1 dex anytime soon.
Without incentives, Sushiswap cannot really compete with V2 yet.
And even with incentives, I doubt it will be able to compete with V3.

What I’m curious about is the way the team will make V3 hard to copy.
I’m sure they will somehow manage to do it even if it means additional delays. Still a good choice.
Setting up optimistic rollups (if any) will certainly be harder than copying V2, but my guess is that there’ll be more than that.

I can’t wait!

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I whole-heartedly agree, and hope the current management displayed by the core team is temporary until v3 is released.

All of these arguments are valid, but it also means current governance is meaningless for small players.
As a community we deserve more than the current level of fog.
You cannot justify the value of UNI as a governance token at the moment and it is a situation that worries me greatly

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Here’s what I suspect happened:
The core team knows V3 is coming soon, and realized that rewarding LPs isn’t necessary at all at this point.
They feared that the community (and LPs) would vote for reactivating LP rewards, and they feared that the LPs gain too much power so early.
These rewards would only lead to more LP rewards, more power for LPs, more LP rewards, more power for LPs.

They realized that this a threat to the protocol, and and an extremely serious one.

So they decided to slow down the setting of this vote, which is weird, but works.

My guess is that in order for V3 to make as much noise as possible and to maximize decentralization, it will include user incentivization at launch.
This would be a fantastic marketing tactic, and would allow to gain crazy market shares not only from all dexes but also from cexes as well. Extremely rapidly

Amazing launch + excellent decentralization = fantastic plan.
Then only can the governance be fully put in the hands of the community, which was the initial plan.


I think it could also be that V2 liquidity incentives will represent a problem with regards to V2->V3 liquidity migration. Once the code is voted, it lasts 2 months and doesn’t distribute anything to future V3 LPers… So the Uniswap team probably thinks V3 might be operational within ~2 months.

True true.
In any case, I don’t see any scenario in which the current situation doesn’t indicate that V3 is coming soon :slight_smile:


Interesting read.

Is this proposal dead? Almost a month now since @monet-supply signalled the technical implementation of the proposal was ongoing. I know a lot of things may have changed in the space since then, but it would be helpful to know if the work on that implementation has been abandoned.


You describe a worst case for decentral goverment. Hidden Information, small teams with control advantage. Then there is no use in creating a community with gov tokens at all.

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This is the best solution for now, and I trust that it will change in the future.
Please don’t forget that another successful vote happened in the past month.

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Hey everyone,

While this proposal had a lot of community support I believe current data has shown that another liquidity program was not necessary for the health of UNI’s TVL.

I strongly recommend doubters to have a look at the numbers : Uniswap | Stats, Charts and Guide | DeFi Pulse

Perhaps we should switch the conversation to another mode of incentivization : LP token yields. There are a lot of projects trailblazing this topic and creating community partnerships might be a smart and efficient way to secure long term TVL.

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