Almost $50 Million UNI Goes Into Governance But Price Tanks to $3

Martin Young
October 6, 2020
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uniswap

Uniswap’s native token, UNI, is flowing into the protocol’s governance mechanism but its prices are still tanking despite an increase in collateral.

According to recent metrics from Dune Analytics, around $47.5 million in UNI tokens have been delegated to protocol governance. The dashboard also revealed that there are over 2,000 delegates and over 87,000 UNI holders.

As with most DeFi governance systems, a few large addresses hold most of the voting power which effectively gives the whales control over the direction of the protocol.

Late last month, a Glassnode report delved into the Uniswap token distribution roadmap and governance plans concluding that the protocol falls far short of true decentralization. At the time, it stated that only 15 addresses control at least 10 million UNI.

Four of these are reserved for the governance treasury, and one is the airdrop distributor address. Of the remaining ten addresses, nine of them contain part of the team and investor token allocation, and the last one is controlled by Binance.

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Uniswap TVL at All-Time High

Centralization concerns aside, Uniswap metrics are continually improving in terms of liquidity provision. The protocol is at the top of the list in terms of total value locked according to Defipulse.com.

TVL is at an all-time high on Uniswap at just under $2.4 billion, or 22% of the total collateral across all DeFi platforms. Over the past two months, it has surged almost 1700%, driven largely by SushiSwap and the launch of its own liquidity mining pools in mid-September.

At the time of writing the amount of crypto collateral locked across those four pools was $1.78 billion, or 75% of the total locked on the platform. The most popular pool is the ETH/USDC one with almost half a million dollars worth locked up.

The pools are currently earning 583,333 UNI per week each and will continue to do so for the next six weeks.

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UNI Prices Sliding

The positive collateral figures have not helped UNI token prices, however, as it continues to slide. At the time of writing, UNI was changing hands for $3.12, down 11% on the day according to Uniswap.info.

UNI price
UNI/USD – uniswap.info

Since the beginning of October, UNI has dumped 30% and since its peak, shortly after launch, it has lost 60%.

Like most recently launched DeFi tokens, UNI is going off the boil and being sold off as ‘degen’ farmers flock to the new latest craze.

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Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
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Why Trust CoinGape

CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.

About Author
About Author
Martin has been writing on cyber security and infotech for two decades. He has previous forex trading experience and has been covering the blockchain and crypto industry since 2017.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.