Author: Bruce

Preface

The founder of Uniswap released the latest proposal early in the morning, which concerns the seven failed fee switches over the past two years. Here, I will borrow @Michael_Liu93's content to explain this proposal and the buyback:

• Burned 100 million tokens, accounting for 10% of the total supply, approximately $950 million (to compensate for the previous lack of burns);
• Use 1/6 of the fees for buyback and burn (5/6 goes to LP), in the past 30 days, $230 million in fee income, annualized it amounts to $2.76 billion, 1/6 means $460 million annually will be used to buy back and burn UNI in the market, which, based on the current market value, corresponds to an annual deflation rate of less than 5% of the total token supply;
• Calculate the valuation multiple of $UNI, with a market cap of $9.5 billion, corresponding to a P/E ratio of 21x and a P/S ratio of 3.5x;
• Compared to Hyperliquid, which has a $42.1 billion FDV, annual revenue of $1.29 billion, annual buyback amount of $1.15 billion, P/E ratio of 37x, and P/S ratio of 33x;
• Compared to Pump, which has a $4.5 billion FDV, the revenue from the meme business fluctuates significantly, oscillating between $1-3 million over the past few months. Assuming $1.5-2 million in daily revenue, annualized it would be $550-730 million (100% buyback), corresponding to a P/E and P/S ratio of around 6x-8x.
• The original text is here: https://x.com/Michael_Liu93/status/1988031857653674417

PE/PS of US-listed companies

????‍♂️ Please follow me to analyze @Uniswap's future prospects!

Will the proposal pass?

✅ High probability of passing (over 80%)

1️⃣ Core palace position dominated by Jige:

The value symbol falls into the Kun palace, which is the highest decision-making body and final result. The pattern is the auspicious configuration of the Azure Dragon returning to its head, indicating that it is the trend of the times and destined to succeed. This pattern clearly points to the proposal ultimately passing.

Both the day stem and the time stem have auspicious deities and extraordinary stars, showing strong internal driving forces within the community, and the quality and timing of the proposal are appropriate.

2️⃣ Transformation of opposing forces:

The key opposing role (investors) has power in the situation, but the pattern of their palace position shows that their stance has softened and changed. Tian Rui and Jiu Tian are in the same palace, indicating that their concerns have shifted from "strong opposition" to "how to avoid risks in the process," with their energy more focused on seeking solutions rather than direct obstruction.

⚠️ Core issues to be encountered in the process

Although passing is a high-probability event, the process will not be smooth sailing and will mainly face the following three major challenges, corresponding to the three palaces in the Qimen arrangement:

1️⃣ Final confirmation of legal and tax risks (core obstacle)

Situation: The Dui palace is facing Tian Rui + Jing Men + Jiu Tian, indicating that the intermediate process will require much discussion.

Corresponding reality: This has always been the core concern of investment institutions like @a16z. Legal debates regarding the classification of securities and DAO tax liabilities will reach a climax before and after the vote. It may require additional legal opinions or slight adjustments to the proposal terms to completely dispel the doubts of large institutions. This is the most time-consuming part of the entire process.

2️⃣ Rebound and appeasement of the LP (liquidity provider) community

Situation: The Zhen palace is facing Liu He + Xiu Men + Tian Ren.

Corresponding reality: Some LPs may feel dissatisfied due to the diversion of profits and even threaten to move liquidity to competitors. Community governance needs to effectively communicate and explain the compensation mechanism (such as PFDA) and the rationality of phased implementation to soothe these emotions and maintain the foundation of the protocol.

3️⃣ Competitors seizing the opportunity to attack and public opinion interference

Situation: The Li palace is facing Teng She + Shang Men + Tian Fu Xing.

Corresponding reality: Competitors will capitalize on the "UNI sacrificing LP" point to create negative public opinion on social media, attempting to shake community consensus and divert users and liquidity.

What are the development prospects?

The overall trend can be summarized as: short-term sharp fluctuations due to significant positive stimuli, mid-term spiral upward in value reassessment and fierce competition, and long-term development deeply tied to the success or failure of Unichain and the fate of the entire DeFi industry. Its fortunes are not a smooth path but a process of gradually realizing its potential as a "DeFi blue-chip leader" after overcoming numerous obstacles.

???? Core trend interpretation

1️⃣ Short-term trend (next 3 months): news-driven, oscillating accumulation

Sharp fluctuations: Bing Qi falls into the Dui palace (Jing Men + Jiu Tian), representing a sudden surge triggered by the proposal news. However, after a price spike, there will inevitably be a pullback and oscillation.

Key node: The upcoming 22-day voting period is a core observation window. The value symbol is in the Dui palace, with $7 - $7.5 being the short-term lifeline. If it can hold, there is hope for another upward attack after the proposal passes.

Market sentiment and voting progress will dominate the price, with the trend primarily characterized by wide oscillations, accumulating energy for the next phase of directional choice.

2️⃣ Mid-term trend (6 months - 2 years): value reassessment, upward trend

Pattern opens: Jia Shen Geng falls into the Kun palace, with the value symbol and Tian Ying present. This pattern indicates that once the proposal passes, it will attract mainstream capital attention, initiating a journey of value discovery.

6 months: Target price $15 - $25, corresponding to a market cap of $15 billion - $25 billion, achieving the baseline scenario.

1-2 years: If it can effectively capture protocol revenue and stabilize deflation, it is expected to challenge the historical high of $44.5 and move towards the $50 - $75 range. In 2026 (Bing Wu), the Li palace will be filled, and policies and ecological benefits may resonate.

3️⃣ Long-term trend (3-10 years): ecology is king, destiny belongs

Successful path: If @Unichain can successfully build an ecosystem that combines protocol revenue with on-chain value capture, $UNI will no longer just be a trading protocol token but will upgrade to a core asset of Web3 financial infrastructure. The Qimen arrangement of "value symbol guarding Kun, Azure Dragon returning to its head" also supports its long-term leading position, with a price target of $100 - $200.

Mediocre path: If it fails to break through in competition and can only maintain its current market share, then $UNI will become a high-quality "DeFi bond," with its value supported by stable buyback and burn, and the price may fluctuate in the $30 - $60 range.

Competitive landscape: moat and breaking point

Moat: The Kun palace value symbol where @Uniswap is located represents its strong brand, liquidity, and user habits, which is a gap that other competitors find difficult to cross in the short term.

Breaking point: Competitors are in the Dui palace, Tian Rui + Jiu Tian, whose high token incentive model (ve(3,3)) is aggressive but unsustainable. The key to @Uniswap's breakthrough lies in utilizing V4 Hook, @Unichain, and other technological iterations to create new sources of value without severely harming LP profits, achieving "both fish and bear's paw."

Core risk warnings

Governance risk: The greatest uncertainty still lies in the voting. Although the probability of passing is high, the Du Men master may obstruct, and it is necessary to guard against new legal concerns raised by large holders like @a16z at the last moment.

Competition risk: Zhen palace Liu He + Xiu Men suggest that other protocols may unite to seize liquidity. If the fee switch leads to a significant loss of LPs, it will shake the foundation.

Macro and regulatory risks: Kan palace Xuan Wu + Jing Men, caution is needed against black swan events in global regulatory policies after 2026, as well as systemic risks from the crypto market's own bull-bear transitions.

Prospect extrapolation: success or failure in ecological integration

???? Uniswap: The value return and defense battle of the DeFi leader

Core prospect: The protocol will completely transform from a "governance tool" to a "yield-generating asset," completing the closed loop of value capture, but its liquidity throne is facing unprecedented challenges.

Uniswap protocol revenue

1️⃣ Value reshaping (1-2 year golden window)

Pattern positioning: Kun palace "value symbol + Wu Bing Azure Dragon returning to its head," this symbolizes the return of the king and value reassessment. The opening of the fee switch is key to igniting this trend. $UNI will shed the label of "worthless governance token" and become a core asset with clear cash flow and deflation expectations.

Valuation target: Based on annualized hundreds of millions in buyback and burn, its P/E ratio will shift from the current 2.2x (fee-based) towards traditional tech stocks (20-30x). It is highly probable that the market cap will return to its previous high ($44.5) within 1-2 years, with mid to long-term potential to challenge the $75-$100 range.

2️⃣ Moat defense (core contradiction)

Risk location: Dui palace Tian Rui + Jiu Tian, competitors are launching fierce attacks with extremely high capital efficiency (ve(3,3) model). @Uniswap's strategy of sacrificing some LP profits for protocol revenue is a double-edged sword.

Key to success or failure: Whether it can create new revenue sources sufficient to offset fee deductions through innovations like V4 Hook and PFDA auctions. If successful, the moat will be reinforced; if not, it will fall into a negative spiral of liquidity loss.

⛓️ Unichain: A high-risk ecological breakthrough battle

Core prospect: This is a high-risk gamble; success will open up a trillion-dollar valuation space, while failure may lead to becoming a mediocre "backup chain."

Unichain revenue situation

1️⃣ Opportunities and ambitions

Pattern positioning: Gen palace "Kai Men + Bai Hu + Tian Peng." Kai Men signifies a huge market opportunity and new narrative, Tian Peng indicates bold speculation and expansion, suggesting that @Unichain aims to solve the mainnet performance bottleneck and value capture issues through a dedicated chain model, building new ecological barriers.

Imagination space: If @Unichain can deeply bind its sequencer revenue, V4 native advantages with the $UNI token economy, it will no longer just be a chain but the value sediment layer of the entire @Uniswap ecosystem, with potential far exceeding that of a simple DEX protocol.

2️⃣ Risks and challenges

Pattern danger: Bai Hu indicates fierce competition and a sense of pressure, showing that @Unichain will face the crushing of mature L2 ecosystems like @base, @Arbitrum, and @Optimism. Tian Peng also carries the risk of "over-speculation" and "security vulnerabilities."

Core dilemma: Ecological cold start: How to attract top applications beyond @Uniswap itself to form network effects is a matter of life and death.

Value Proof: Can the initial annual income of $7.5 million from the sequencer support the enormous costs of chain development and maintenance, and benefit $UNI holders?

???? Symbiotic Relationship: One thrives, all thrive; one suffers, all suffer.

Successful Scenario (70% probability): @Uniswap stabilizes its base through brand and liquidity, providing initial users and credibility to @Unichain; @Unichain, in turn, supports @Uniswap through lower transaction costs and more flexible Hook applications, consolidating its leading position and opening up new revenue sources. The two form a flywheel, with $UNI becoming the universal key to the entire ecological value.

Failure Scenario (30% probability): @Uniswap experiences liquidity loss due to the fee switch, leading to market share erosion; @Unichain stagnates due to ecological scarcity. The two drag each other down, and the value return story of $UNI ends in disappointment.

???? Key Observation Points for Future Evolution

• Early December 2025: Final voting results of the fee switch proposal and immediate market reactions.
• Mid-2026: Adoption rate of V4 and early deployment on @Unichain.
• 2027: Independent TVL of Unichain and the number of native applications, whether it can form its own ecosystem.

Final Ownership of Uniswap Labs: Spin-off and IPO?

In the future, Uniswap Labs may spin off part of its business (such as @Unichain development, front-end services) into independent companies and seek to go public, which is a highly probable path.

✅ Favorable Factors Supporting IPO (Probability: about 60%-70%)

1️⃣ The situation shows that "opening the door" is possible.

The Gen Eight Palace, representing the action of Uniswap Labs, inherently carries the "opening the door" symbolism, which signifies new organizations, new opportunities, and collaborations. Spinning off part of the business into a company aligns with this symbolism.

The Tian Peng star falls into this palace, indicating bold capital operations and expansion, suggesting that the Labs team has sufficient ambition and motivation to push for such initiatives involving significant financing.

2️⃣ Clear value carrier, avoiding core conflicts.

This move cleverly separates "protocol governance rights" (belonging to $UNI tokens) from "technical service and development rights" (belonging to the equity of the listed company). The listed company can clearly use its technical capabilities, software development income, and future sequencer revenue from @Unichain as valuation bases, no longer directly tied to the securities attributes of $UNI tokens, resolving the most critical regulatory contradictions.

3️⃣ There are successful precedents to follow.

Just like the relationship between @Coinbase and @Base, as well as the earlier relationship between @ethereum and @Consensys. @Consensys, as the core development force of the Ethereum ecosystem, has undergone multiple rounds of financing and has frequently been rumored to go public. This provides a clear blueprint for Uniswap Labs.

⚠️ Challenges and Risks Faced (Obstacles Remain)

1️⃣ Market competition and pressure.

The Gen Palace sees Bai Hu, meaning that even if a spin-off and IPO occur, this process will be accompanied by extremely fierce market competition and significant external pressure. The capital market will compare it with companies like @Coinbase and scrutinize its profitability and growth potential.

2️⃣ The delicate balance of the pattern.

The listed company will still need to rely heavily on the brand and ecosystem of the @Uniswap protocol. Ensuring that the interests of the listed company align with those of the decentralized community will be a major governance challenge. If the listed company’s actions harm the interests of the protocol (such as charging excessively high fees), it will provoke strong opposition from the $UNI community, shaking the foundation.

3️⃣ Business independence and valuation basis.

The capital market will ask: What is the core barrier of this company? If it is merely a front-end service provider for the @Uniswap protocol, its value is limited. It must prove that it possesses independent technological advantages and revenue sources (such as exclusive operating rights for @Unichain, cross-chain technology patents, etc.) to achieve a high valuation.

In Conclusion✍️

At the crossroads of DeFi, Uniswap Labs is using the fee switch as a key to unlock the golden age of value capture: the proposal is highly likely to pass, $UNI will transform from a governance tool into a yield-generating asset, breaking through with the @Unichain ecosystem, forming a flywheel effect of mutual prosperity. Furthermore, if Labs successfully spins off and goes public, this will resolve regulatory shackles, inject vitality from mainstream capital, and propel $UNI to new heights. However, success or failure hinges on community consensus, competitive defense, and the guidance of fate.

Are you ready to witness the return of the DeFi king and the rise of the Web3 financial empire?

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