Uniswap's UNI token is down about 29% over four weeks and has underperformed bitcoin and ether. Liquidity held on the exchange, however, remains near $4 billion.
UNI traded near $6.80 early Oct. 24, down about 29% over four weeks. The token substantially underperformed bitcoin and ether, even as liquidity on the decentralized exchange stayed near $4 billion.
UNI falls while pool liquidity holds
Measured from 6 a.m. ET on Sept. 26, UNI fell 29.2%, compared with 4.2% for bitcoin and 12.0% for ether, according to CoinGecko's price series. The series put UNI at $6.7976 at 5:20 a.m. ET, the lowest of the retrieved price samples since Sept. 26.
Capital in Uniswap's pools did not follow the token lower. DefiLlama's daily series showed total value locked at approximately $4.02 billion at both ends of the Sept. 26–Oct. 24 period. Dollar-denominated TVL measures asset values, not net deposits.
Over the shorter period beginning at 6 a.m. ET on Oct. 17, UNI fell about 7.1%, against bitcoin's 1.3% and ether's 3.0%.
Trading volume and fees continue
Uniswap also kept processing trades. DefiLlama reported seven-day swap volume of $12.82 billion, alongside $15.53 million in user fees and $1.46 million in protocol revenue over the same seven days. User fees include payments to liquidity providers, so they are not all income the protocol retains.
The link between trading activity and UNI also depends on the fee-and-burn mechanism. In a September governance proposal, Uniswap Labs described fees accumulating in contracts called TokenJars, which searchers can claim in exchange for burning UNI.
The figures and the proposal do not establish a cause for UNI's underperformance. They show a token losing value while the exchange keeps holding liquidity and generating fees.
Source: The Defiant
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