DeFi’s UNI Token Jumps 92% in One Week, Passes $15

DeFi’s UNI Token Jumps 92% in One Week, Passes $15

Decentralized finance (DeFi) exchange Uniswap’s native token uni (UNI) broke $15 per token on Coinbase Wednesday morning. It’s up more than 92% in one week and up 1,300% since the token debuted in September 2020, according to CoinGecko at press time.

Valued at $4.2 billion, Uniswap’s UNI has the highest market cap of any DeFi token on the market, according to research firm Messari.

The governance token has been caught up in bitcoin’s 2020-21 bull run along with other DeFi tokens. At $25.1 billion, DeFi Pulse’s Total Value Locked (TVL) metric – similar to assets under management (AUM) – is up nearly $10 billion from Jan. 1. TokenSets’ DeFi Pulse Index, which measures a suite of DeFi token prices, is also up 136% on the year.

7-day percentage gains of UNI/USD (Orange) and SUSHI/USD (Blue). Source: Parsec Finance

A governance token, UNI holders can vote on the direction of Uniswap version 2 such as how the Uniswap treasury will be spent. The exchange’s weekly volume has also surpassed its impressive initial run during “DeFi summer.” During the first three weeks of January, volume averaged some $5.6 billion while available liquidity on the exchange consistently sat above $3 billion, according to info.uniswap.

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Those figures are even better than Uniswap’s summer run, which saw the exchange briefly surpass trading volumes on soon-to-IPO Coinbase. Not bad for a unicorn.

Read more: Uniswap Is the Number One Gas Guzzler on Ethereum

At the time, Uniswap conducted what’s called a token “airdrop” to anyone who had ever used the exchange before. The token drop was in response to rival exchange SushiSwap forking Uniswap’s codebase and trying to draw away users with a new token, SUSHI, in what is now called “vampire mining.” Each nominal user was given 400 UNI tokens amounting to 60% of the 1 billion UNI minted. Each airdrop is now worth about $6,000; it was jokingly referred to at the time as crypto’s own stimulus check. SUSHI is also up 177% over the last 30 days, according to Messari.

Uniswap investors, advisers and team members are also up big after an initial allocation of the tokens, although a four-year vesting schedule remains in place. According to a Uniswap blog post, 21% or 212,660,000 UNI (at press time: $3.2 billion), were allocated for current and future team members. An additional 18% or 180,440,000 UNI ($2.7 billion) were set aside for investors plus 0.69% or 6,900,000 UNI ($103.5 million) for advisers.

Uniswap, whose core team is based in Brooklyn, N.Y., raised $11 million in a Series A backed by Andreeson Horowitz, Paradigm, Union Square Ventures and VersionOne.

Uniswap founder Hayden Adams declined to comment.

The Battle of The DEX Heats up as Uniswap (UNI) Hits All-Time High

UNI prices reached their highest ever levels of $15.50 a few hours ago according to Coingecko. The move has added 5% on the day while most other high cap crypto assets are retreating in the shadow of their big brother.

UNI has now made a whopping 60% over the past seven days and almost 300% since the same time last month when it was priced at just $3.60. Its rival and former fork SushiSwap has retreated a little as its token falls by 5% on the day back to $7.30.

Both decentralized exchanges are doing very well in terms of liquidity lockup and trading volumes, however, as observed by researcher Lucas Campbell in the latest Bankless newsletter.

Things are heating up between Sushiswap and Uniswap Both have billions in liquidity Both facilitating billions in volume This is the DEX title fight Here’s how they stack up against each other 🧶https://t.co/J3CCL3Gs8K — Lucas 🔥_🔥 (@0x_Lucas) January 28, 2021

Uniswap Takes The Lead

The rivalry between these two DeFi titans has been heating up in recent weeks and it is no surprise considering their history. One was spawned from the other but has made it in its own right and is now vying for the title of top DEX.

Diving into the on-chain metrics, the Bankless newsletter has broken the competition down into several rounds, giving Uniswap the first one for trading volume. Over the past three weeks, Uniswap has averaged almost $6 billion in weekly volume whereas SushiSwap processed around $2.8 billion it noted.

The next round was liquidity which also went Uniswap’s way with just over $3 billion versus just under $2 billion. The total value locked across both decentralized exchanges is currently higher than it was for the entire DeFi ecosystem back in mid-August, 2020.

In terms of daily revenue, Uniswap also comes out ahead with the DEX averaging over $2.3 million in fees to liquidity providers per day in January 2021.

SushiSwap Fights Back

SushiSwap starts to win a couple of rounds back in terms of price to sales ratio which compares a token’s market cap to the protocol’s revenue. SushiSwap has been holding steady with a P/S ratio of ~5 while Uniswap recently touched ~15, it added,

“With the above in mind, the market is currently overvaluing Uniswap relative to SushiSwap strictly in terms of the cash flows it generates today.”

The price to volume ratio, which is similar to the above, also comes out in SushiSwap’s favor with the market is currently valuing SushiSwap at around $4 for every $1 in volume that it facilitates on a daily basis, while this ratio is higher for Uniswap at around $11 for every $1 in volume it processes.

The final metric was price performance and both tokens have had a massive run-up recently. This one can be measured in different ways, but Bankless gives it to SushiSwap measuring percentage price increase since the beginning of Q4, 2020.

Overall, Uniswap still has the upper hand, but its rival is catching up. The launch of Uniswap v3 is likely to give it even more momentum to retain its accolade as the world’s leading DEX.

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Uniswap (UNI) Price Explodes to New Highs

The price of UNI, the native governance token of decentralized finance (DeFi) platform Uniswap, has reached a new all-time high of $14.25, according to crypto metrics platform CoinGecko.

UNI’s price just reached a new all-time high. Image: CoinGecko

At press time, UNI is trading at around $14.22, up 13.7% on the day. The token’s price has surged by over 65% in total over the past week, pushing its market capitalization over the $4 billion mark.

$UNI governance token is soaring to become biggest #DeFi token despite having no value accrual. Wdyt? — 🃏αlphαntes (@Fiskantes) January 26, 2021

Market capitalization is an asset’s current price multiplied by its total supply—a metric that lets you compare multiple coins that have different supplies.

On the heels of UNI’s ongoing price rally, it’s now ranked second among the top DeFi tokens by market cap, CoinGecko’s data shows. And even outside of the “social circle” of DeFi tokens, UNI’s performance is admirable—it is currently ranked thirteenth among all cryptocurrencies by its market cap.

UNI is the 13th largest crypto by its market cap. Image: CoinGecko

DeFi is booming

Since exploding last summer, the DeFi ecosystem has been one of the top-performing crypto markets so far. According to analytics platform Messari, the only two sectors that are in the green in terms of their recent market capitalization growth are DeFi and decentralized exchanges—they are up 17.6% and 23.2% over the last week, respectively. In comparison, the Currencies sector, including Bitcoin, is down 12%.

As Decrypt reported, DeFi’s market cap recently exceeded $45 billion amid the ongoing price rally, with UNI and AAVE showing the best results among the top 10 DeFi tokens.

DeFi and DEXs are constantly growing. Image: Messari

Messari researcher Ryan Watkins pointed out that UNI is not extracting fees from its liquidity providers—unlike many other projects in the industry that are “obsessed” with dividends. While the potential to accrue value is important for tokens, earnings potential is not the same as dividends, he argued.

Along this line of thinking, even if a token does implement some kind of fee capture it’s much better to reinvest those earnings rather than distribute as dividends. UNI implicitly does this by not extracting fees from LPs (fee switch off). — Ryan Watkins (@RyanWatkins_) January 26, 2021

“Along this line of thinking, even if a token does implement some kind of fee capture it’s much better to reinvest those earnings rather than distribute as dividends. UNI implicitly does this by not extracting fees from LPs (fee switch off),” he tweeted. Perhaps that’s why it’s performing so well.