Minting Mechanism (Mint & Inflation) — Governance Authority and Inflation Potential
Complementing the burn mechanism is the protocol’s minting and supply cap design:
1. Initial Supply and Current Status:
UNI had a total initial issuance of 1 billion tokens at genesis. Following historical and recent burns, the actual circulating supply and total supply have declined significantly.
2. Governance-Authorized Minting Cap:
According to Uniswap’s protocol plans and developer documentation, there is currently no active day-to-day token inflation (No active inflation).
However, the Uniswap governance DAO retains the authority to authorize minting up to 2% of the total supply in UNI per year.
3. Actual Implementation:
To date, the community and governance have not exercised this minting authority. Therefore, under normal operating conditions, the ecosystem currently leans toward a deflationary asset model with no active inflation and dynamic fee-based burns.
Based on the current burn rate, an estimated 2% is burned annually.
But price fluctuations are far greater than that figure.
Doesn’t seem very exciting 🤔
$UNI
Complementing the burn mechanism is the protocol’s minting and supply cap design:
1. Initial Supply and Current Status:
UNI had a total initial issuance of 1 billion tokens at genesis. Following historical and recent burns, the actual circulating supply and total supply have declined significantly.
2. Governance-Authorized Minting Cap:
According to Uniswap’s protocol plans and developer documentation, there is currently no active day-to-day token inflation (No active inflation).
However, the Uniswap governance DAO retains the authority to authorize minting up to 2% of the total supply in UNI per year.
3. Actual Implementation:
To date, the community and governance have not exercised this minting authority. Therefore, under normal operating conditions, the ecosystem currently leans toward a deflationary asset model with no active inflation and dynamic fee-based burns.
Based on the current burn rate, an estimated 2% is burned annually.
But price fluctuations are far greater than that figure.
Doesn’t seem very exciting 🤔
$UNI