Hey @haydenadams and team,
I read the proposal and think it’s great news for the development of the Uniswap AMMs and all the onchain infrastructure supporting it. That said, I do worry about the actual incentive alignment between Labs, the Foundation, and the protocol(s). Uniswap Labs is a Delaware C corp that raised large venture rounds on it’s equity and therefore has expectations from it’s investors that the Labs equity will be more valuable in the future. Traditionally businesses become more valuable by maximizing cash flow from it’s products. Instead it’s seems that Labs is moving away from this model by increasing the value of it’s UNI holdings which ideally happens the more revenue the Uniswap AMMs and supporting protocols generate. That seems fine in practice but to realize that value the company must sell it’s tokens, reducing its stake and therefore its future incentive to continue long term development. Even more so, it exposes the Labs entity to volatility and speculation of the UNI token. This moves Labs away from being a company focused on just products to one needing sophisticated treasury management operations. Additionally, if Labs is the primary entity building the protocol and expanding it’s market share, to what extent is it fair that Labs only receives a small portion of the value it creates by holding a small percentage of the token supply. Additionally, many of the core trading functions powered by Uniswap protocols (e.g. Unichain sequencer, UniswapX) requires Labs to run centralized infrastructure. This has created a massive, complex intermediary layer that if Labs truly went away would kill the viability of the protocol. If Labs shuts off it’s own interface fees, it could expose them to unpredictable revenues and thereby have consequential effects on the protocol(s) itself. More importantly, turning on the Uniswap fee switch and then burning UNI tokens feels like the Uniswap AMMs would no longer be public goods but instead a commercialized product. Needless to say, I still like the direction that Labs is taking to prioritize Uniswap V4 but remain skeptical of the alignment between Labs, protocol fees, and the UNI token if the actual protocol(s) are to remain public goods.