Uniswap proposes to expand protocol fee collection across all pool v3 and 8 chains

Uniswap governance is considering a major scaling proposal for the protocol fee mechanism, which would activate fees across all remaining v3 pools on the Ethereum mainnet and extend this mechanism to eight additional blockchains.

The “temp check” vote has now been posted on Snapshot and is scheduled to conclude on February 23. The proposal includes enabling protocol fees for v2 and v3 deployments on eight additional networks, including Arbitrum, Base, Celo, OP Mainnet, Soneium, X Layer, Worldchain, and Zora.

At the same time, the proposal also introduces a tier-based fee adapter, allowing automatic application of protocol fees to all v3 pools based on the liquidity provider (LP) fee tier.

If fully approved through governance, this change will apply protocol fees to all v3 pools, rather than limiting to a selected list of pools as before. This marks a significant structural shift in how Uniswap captures and recognizes revenue value.

The New Governance Mechanism Under “UNIfication”

This is the first proposal to implement a streamlined governance process under the “UNIfication” framework — a major overhaul approved late last year. This mechanism allows parameter changes, such as fees, to bypass the traditional community feedback phase, moving directly to a Snapshot vote lasting 5 days, followed by an on-chain decision, enabling faster adjustments while maintaining a timelock execution process.

UNIfication also lays the groundwork for directing protocol revenue into a token burn mechanism, where collected fees are converted into UNI and permanently removed from circulating supply.

Since the initial fee activation for v2 and some v3 pools in December, governance contributors report that total value locked (TVL) has been trending upward on Ethereum mainnet, aligned with market conditions, and the token burn infrastructure has been operating smoothly.

According to the proposal, the initial deployment process went smoothly, with TVL increasing since December, and the burn system functioning as designed, automatically converting various fee tokens into UNI for burning.

Uniswap founder Hayden Adams also confirmed that the first fee activation phase is closely monitored and the system is operating efficiently. The next phase will expand fee collection to all remaining v3 pools and additional chains, further increasing the protocol’s revenue capture potential.

Cross-Chain Fee Collection and Token Burn Mechanism

Under the new plan, fees collected on Layer 2 networks will be transferred into dedicated “TokenJar” contracts per chain, then bridged back to Ethereum mainnet for burning. On mainnet, a specialized contract called “Firepit” will handle direct burning.

Due to governance contract limitations, if the Snapshot vote passes, two separate on-chain proposals will be submitted simultaneously, splitting the fee expansion across different network groups.

This move is part of Uniswap’s broader strategy to standardize protocol revenue streams, amid ongoing restructuring of various system components. Earlier this year, Uniswap began deploying “Continuous Clearing Auctions” on the main interface to change how new token launches are handled. The protocol is also expanding into organizational functions, including enabling on-chain trading of tokenized treasury bonds via BlackRock’s BUIDL token, in collaboration with Securitize.

Uniswap is a multi-chain decentralized exchange initially built on Ethereum, allowing users to swap tokens directly from their wallets through automated liquidity pools, instead of traditional order books or intermediaries. It remains one of the leading DeFi protocols in trading volume and fee revenue.