Let’s be real— for many people, understanding cryptos can feel like rocket science! Many of you may have questions about what is Uniswap token and other topics related to them. So I am here to make it simple for you. Let me tell you about the Uniswap token today, one of the coolest things in the crypto world right now.
Uniswap is a decentralized virtual marketplace where people can swap digital tokens directly in a peer-to-peer way without the involvement of any third parties. The Uniswap tokens (UNI) are its native platform token that plays a major role in making everything work smoothly. Let me explain what makes this token unique, and its creation throughout this blog.
First, let me tell you what is Uniswap token now.
So, let’s get started!
What is Uniswap Token?
The Uniswap token (UNI) is a native token of the Uniswap decentralized exchange, which acts as a governance token for this platform. Users who hold the UNI token will get the right to vote for important decisions on the Uniswap exchange. Users can earn this token quickly as an incentive by supplying liquidity on the Uniswap platform.
UNI tokens are easily available for purchase and sale through various cryptocurrency exchanges. Moreover, this Uniswap token encourages the community. Also plays an essential role in the platform’s operations, making it a key player in the decentralized finance (DeFi) empire.
Right, let us take a look at UNI token creation and airdrop now.
Uniswap Token (UNI) Creation and Airdrop
This Uniswap token (UNI) establish on September 16, 2020, and it kept a powerful moment in the history of Uniswap and the DeFi empire. However, why was the token made at the top?
As a leading decentralized exchange, Uniswap already had a large user base and a growing reputation before the creation of the UNI token. While the users could freely swap tokens on the platform, users lacked a formal mechanism to control the direction of Uniswap development.
So, the Uniswap team launched a UNI token to resolve this problem. Users who hold UNI tokens can participate in governance, ensuring the platform’s community-driven nature.
But launching the UNI token wasn’t just a straightforward process. To make a big influence, they offered a huge airdrop to their early users. As a result, those who used the Uniswap platform (e.g., trading, providing liquidity). before September 1, 2020, were eligible to claim 400 UNI tokens as a reward.
This airdrop was a good way to reward Uniswap’s early adopters and loyal users. It also distributed governance to a broad user base and ensured that the platform was community-driven from the start.
Well, let us see how this UNI token is distributed now.
Distribution of UNI Token
The Uniswap team has made nearly 1 billion UNI tokens, part of which is dedicated to users and will be unlocked in 4 years. Let me tell you the details of Uniswap token allocation now.
- 60% (600 million UNI) were assigned to the Uniswap community members.
- 21.26% (213 million UNI) has been assigned to the future employees of the Uniswap platform, which will unlock over the next four years.
- 18% (180 million UNI) tokens were allocated to investors with the four-year unlocking schedule.
- 0.69% (7 million UNI) tokens have been allotted to advisors with a 4-year vesting period.
Additionally, the tokenomics of Uniswap introduces a perpetual annual inflation rate of 2% after the first four years. This inflation rate can serve as an incentive for UNI token holders to remain actively involved in the governance of the Uniswap protocol.
It’s essential to mention that around 43% of the community tokens are prearranging in the governance treasury. This treasury is essential for managing the distribution of Uniswap tokens (UNI) through liquidity mining, community development initiatives, and various applications.
Unique Features of UNI Token
Now we know how this UNI token was created, let us explore the unique features of the UNI token that make it stand apart from many governance tokens.
Decentralized Administration
One of the standout aspects of the UNI token is its decentralized governance model. Unlike conventional companies that depend on a board of directors or executives for decision-making, Uniswap authorizes its users to take charge. As an effect, no single organization has control over the platform.
Here the UNI token holders can suggest changes, and other token holders can vote on their suggestion requests. This path, the people who actually use Uniswap, will direct its future development.
Rights to Vote
One of the best features of the UNI tokens is that they give access to users to vote on important decisions that influence the future growth of the Uniswap platform.
So UNI token holders can vote on various decisions according to the platform, like changes in governance and upgrades in the platform.
Rewards For Liquidity Providers
The persons who provide liquidity on the Uniswap platform can earn this UNI as a reward. Adding your tokens to liquidity pools allows you to make trades, and as a result, you earn UNI tokens. This practice not only promotes participation but also permits you to benefit from the development of the platform.
Wide Utility and Integration
The UNI token is for voting purposes and in various decentralized finance applications. This flexibility makes it a valuable asset in the broader crypto empire. As more platforms integrate UNI, it opens up new opportunities for token holders.
Now that we’ve covered the essentials, let’s wrap up.
Wrapping Up
Finally, now you know what is Uniswap token, about its creation, airdrop, UNI distribution, and unique features. To conclude, the creation of the UNI token leads a path to transform the Uniswap platform from a decentralized exchange into a community-owned and governed protocol.
Moreover, the hype for tokens is growing drastically nowadays, and the DeFi exchange is in vast demand for swapping tokens. If you are an entrepreneur, you can use this golden opportunity to make a profitable business in the DeFi world by providing a DeFi exchange platform like Uniswap for crypto enthusiasts.
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