tjar

UNI has come up with something new again.

This time, it’s TJAR (Token Jar), a piece of on-chain infrastructure that looks simple but is quite interesting.

What problem does it solve?

Many DeFi applications collect fees in ETH, USDC, or various other tokens. But projects usually only want to receive one of them, such as a stablecoin or their own token.

Previously, projects had to handle the collection and conversion of these assets themselves. TJAR provides a general on-chain mechanism that first pools fees collected in different tokens, then lets Searchers pay in a designated token to acquire the pooled assets through an open competitive process.

A few aspects are worth noting:

1. General-purpose: Any protocol that earns fees in multiple tokens can use this mechanism; it isn’t limited to Uniswap products.
2. No need to build your own conversion system: Projects can specify the token they ultimately want to receive, without developing a separate process for handling each fee asset.
3. No reliance on price oracles: TJAR itself doesn’t price assets. Instead, participants decide whether execution is worthwhile based on the value of the pooled assets and the cost of conversion.
4. Open execution: Any qualified Searcher can participate, so a centralized team doesn’t have to manually process every conversion.

More notably, Uniswap itself is also using this mechanism to handle protocol fees, with UNI as the designated token to be burned.

This means TJAR isn’t just a convenient tool for projects to collect fees; it could also become a piece of infrastructure that helps on-chain protocols capture value.

Uniswap is becoming more than just a DEX. It’s turning mechanisms it has proven in practice into infrastructure that other protocols can use too.

Whether TJAR can lead to greater value capture for UNI remains to be seen. That will depend on how many protocols adopt it and how much in fees it actually generates.

#Uniswap #UNI #TJAR #DEX