Thank you for the fantastic and detailed post! I'm a bit confused by the tl;dr. It says the holders get 1/6. But you also mention the fee switch is turned off. So as of today, what do UNI holders get? If nothing, what's the incentive for holding UNI for those that are not interested in participating in governance (i.e. speculators)?
Hi Barrie, thanks for your warm words. I understand how the tl;dr is a bit confusing. It says "entitles the holder". So what I mean here is that today they do not receive any cash-flows, however at any time, they are collectively entitled to obtain said cash flows. Today, there is no direct incentive indeed. However, you may be buying at a temporarily depressed valuation due to other people thinking like yourself (why buy when cash flows are turned off, I'll buy it when the switch is turned on)!
Great write up. Would be good to elaborate on the specifics of fee collection, including the denomination of fees collected (if swapping 100USDT for AAVE, is the fee collected in USDT?), and whether fees collected are then converted (e.g. to UNI) before moving to treasury.
Something I noticed about UNI -> quite geographically centralized team (nearly all NYC based, including future hires) -> made me wonder how much influence US-based regulators and regulations would have on this "DEX"
They've chose Optimism as their L2 over other solutions, maybe it is the right choice technologically, I haven't really analysis the pros/cons but found it interesting that Horowitz (their VC backers) was also an investor in Optimism, wondering how much this factor came into play...i.e. how biased were they due to this?
Lastly, what are your thoughts on Sushi vs Uniswap and which ones going to come out on top in ~3-5 years?
I think the regulation question is a huge unknown. Frankly, I think if it does become an issue, the team is more likely to just pack up & leave rather than try to work through it. They can't really do anything with KYC or only allowing certain tokens without fundamentally re-working the product. Others have raised your exact point on Optimism and I do find it a bit curious they seem to want to stick to Optimism over deploying on both Optimism and Arbitrum. That's something to monitor and lookout for although I don't think they'd accept losing out to other DEXes because they're on the wrong optimistic L2. From a fundamental perspective, I think the SUSHI token > UNI token, but Uniswap > Sushiswap. I'll probably write about SUSHI at some point.
Thank you for the fantastic and detailed post! I'm confused by the tl;dr. It says the holders get 1/6. But you also mention the fee switch is turned off. So as of today, what do UNI holders get? If nothing, what's the incentive for holding UNI for those that are not interested in participating in governance (i.e. speculators)?
Thank you for the fantastic and detailed post! I'm a bit confused by the tl;dr. It says the holders get 1/6. But you also mention the fee switch is turned off. So as of today, what do UNI holders get? If nothing, what's the incentive for holding UNI for those that are not interested in participating in governance (i.e. speculators)?
Hi Barrie, thanks for your warm words. I understand how the tl;dr is a bit confusing. It says "entitles the holder". So what I mean here is that today they do not receive any cash-flows, however at any time, they are collectively entitled to obtain said cash flows. Today, there is no direct incentive indeed. However, you may be buying at a temporarily depressed valuation due to other people thinking like yourself (why buy when cash flows are turned off, I'll buy it when the switch is turned on)!
Great write up. Would be good to elaborate on the specifics of fee collection, including the denomination of fees collected (if swapping 100USDT for AAVE, is the fee collected in USDT?), and whether fees collected are then converted (e.g. to UNI) before moving to treasury.
Something I noticed about UNI -> quite geographically centralized team (nearly all NYC based, including future hires) -> made me wonder how much influence US-based regulators and regulations would have on this "DEX"
They've chose Optimism as their L2 over other solutions, maybe it is the right choice technologically, I haven't really analysis the pros/cons but found it interesting that Horowitz (their VC backers) was also an investor in Optimism, wondering how much this factor came into play...i.e. how biased were they due to this?
Lastly, what are your thoughts on Sushi vs Uniswap and which ones going to come out on top in ~3-5 years?
I think the regulation question is a huge unknown. Frankly, I think if it does become an issue, the team is more likely to just pack up & leave rather than try to work through it. They can't really do anything with KYC or only allowing certain tokens without fundamentally re-working the product. Others have raised your exact point on Optimism and I do find it a bit curious they seem to want to stick to Optimism over deploying on both Optimism and Arbitrum. That's something to monitor and lookout for although I don't think they'd accept losing out to other DEXes because they're on the wrong optimistic L2. From a fundamental perspective, I think the SUSHI token > UNI token, but Uniswap > Sushiswap. I'll probably write about SUSHI at some point.
Thx
Thank you for the fantastic and detailed post! I'm confused by the tl;dr. It says the holders get 1/6. But you also mention the fee switch is turned off. So as of today, what do UNI holders get? If nothing, what's the incentive for holding UNI for those that are not interested in participating in governance (i.e. speculators)?