I’d like to offer an alternative perspective on some comments I’m seeing.
@ConcernedLP, @Brenner, @Buckerino and @eek637 have all voiced concerns along these lines:
- Fee switch is not high priority at this stage, and other projects are higher priority
- Uniswap Governance needs to figure out what it wants to even spend funds on first
Other Internet has studied Uniswap governance extensively and has talked to stakeholders of many different types, and while I hear these concerns, I do not believe they are entirely correct.
-
Part of the reason for general governance inaction in Uniswap is, in fact, the lack of non-UNI funds in the treasury. Without stables or more liquid currencies like ETH to spend, the UNI token must be liquidated every time a significant opportunity arises. We currently are in a situation in which UNI selloffs to service providers, public goods projects, and grantees that exert downward price pressure on the token in the long run. (Recall the significant backlash about UNI price when DeFi Education Fund liquidated $12.5m in one day). Moreover, generating assets in the treasury that can be spent on protocol growth and expansion makes the governance token more valuable. Recently governance nerds have been obsessed with NounsDAO, a protocol with extraordinarily high levels of governance activity. The number one reason Nouns has generated such a high volume of proposals is that it has significant treasury holdings, spending of which do not dilute Noun holders’ token value. Everything we’ve seen so far suggests that if Uniswap were generating even $10k of ETH & USDC in fees per day, we would likewise see a much higher volume of governance activity and proposals on this forum.
-
Firstly, we have to stop referring to “Uniswap Governance” as a monolith. What we are is a collection of actors with very different incentives. Uniswap is very poorly structured from an ownership perspective, having airdropped to all classes of users. This makes it incredibly unrealistic for people to come together to intentionally decide what to fund at the current moment. Outside of an off-site retreat for major UNI voters, I don’t see a good way to reach consensus on this. OI has taken some responsibility for advocating for specific outcomes we’d like to see here; one of these is the creation of concentrated centers of authority, such as an expanded version of Uniswap Grants Program with a bigger mandate, who we believe would be suitable to set specific goals and drive specific visions.
In lieu of these authority centers existing right now, I believe that the higher volume of proposals stimulated by more liquid assets in the treasury would incentivize a greater degree of competition and higher quality proposals brought to this forum. Right now delegates have too little work to do. Perhaps this is idealistic, but more competition among a higher volume of proposals would force all of us to be more selective and evolve a set of criteria for treasury spend.
A final comment is that nonnative assets in the treasury would make it easier to conceive of spending money on things like paid delegation programs, which would overall improve the quality of governance.
In short, I can’t conceive of the fee switch initiative as low priority. The fee switch is one of the few clear on-chain levers we have available to us to drive more governance work and better outcomes at this time.