Uniswap Labs’ latest project, Unichain, is poised to boost revenues for both the company and UNI tokenholders, potentially earning them close to $500 million annually. According to Michael Nadeau, founder of DeFi Report, the new Layer 2 blockchain will redirect fees that would have otherwise gone to the Ethereum network into the hands of Uniswap stakeholders.
Major Revenue Shift from Ethereum to Unichain
Nadeau explained in an October 13 X (formerly Twitter) post that $368 million in fees paid to Ethereum validators over the past year could instead flow to Uniswap Labs and tokenholders through Unichain. Additionally, Uniswap Labs would capture the Maximum Extractable Value (MEV) on the new blockchain, as it controls the network’s validators.
MEV, which refers to profits gained by reordering transactions within blocks, has traditionally benefited Ethereum validators. However, Uniswap’s ownership of validators on Unichain will allow it to retain all MEV profits, estimated to be about 10% of total fees on Uniswap, or $100 million annually. Nadeau suggested that the project may also share MEV revenues with UNI tokenholders.
Liquidity providers on Uniswap stand to benefit as well, gaining opportunities to participate in MEV capture and settlement through staking on the new network.
Ethereum Validators Could Face Losses
While Unichain offers financial benefits to Uniswap and its community, it could negatively impact Ethereum. Nadeau noted that Ethereum validators and Ether holders would lose revenue, with fewer fees and reduced ETH burns returning to the blockchain.
In the past year, Uniswap has generated over $1.3 billion in trading and settlement fees across five major networks—Ethereum, Optimism, BNB Chain, Base, and Polygon. With Unichain now live, much of that activity may shift away from Ethereum.
Unichain Launch: Mixed Reactions from the DeFi Community
Uniswap launched Unichain on October 10, touting the new Layer 2 blockchain as a solution for faster, cheaper transactions and improved interoperability across networks. Proponents argue that Unichain offers a smoother user experience and reduces liquidity fragmentation for DeFi protocols.
However, not everyone is convinced of the need for another Layer 2 blockchain. Some DeFi observers expressed skepticism, pointing to a September 2022 post by Ethereum co-founder Vitalik Buterin, where he criticized the concept. Buterin argued that Uniswap’s value lies in its simplicity, saying, “Uniswap’s main value proposition is that you can just go and get a trade done in 30 seconds without thinking about it. A Uniswap chain or even rollup makes no sense in that context.”
