Since the recent ETH market rally, ETH has risen 48% over the past month, driving up the prices of numerous ETH ecosystem projects. Historical data shows that blue-chip projects in the ETH ecosystem generally exhibit a multiplier effect during upward cycles. UNI is one of the blue-chip targets highlighted by Trend Research in the ETH ecosystem Portfolio, currently up 28% over the past month. If the market trend continues, it has the potential for further gains. Additionally, UNI possesses a certain Alpha potential under the Beta of the ETH market, due to the potential expectations of macro regulatory easing, leading project business data, and structural price increases of the tokens.

Macroeconomic regulatory situation

Regulatory Ambiguity Period (2021-2023): On September 3, 2021, the SEC launched an investigation into Uniswap Labs, focusing on its marketing methods and investor services. SEC Chairman Gary Gensler has repeatedly stated that DeFi platforms may involve securities regulations, emphasizing the need for more regulatory authority. Subsequently, this investigation sparked widespread discussion in the industry, and whether UNI and similar governance tokens are considered securities became a key issue in crypto regulation. On August 30, 2023, Uniswap won a collective lawsuit against it, with the court dismissing the charges and ultimately ruling that the Uniswap protocol is primarily used for legitimate purposes (such as ETH and BTC trading) and lacks clear regulatory definitions supporting the plaintiffs’ securities claims.

Regulatory Pressure Period (2023-2024): On April 10, 2024, the SEC issued a Wells Notice to Uniswap Labs, accusing the Uniswap protocol of potentially operating as an unregistered securities exchange, and its interface and wallet possibly acting as unregistered securities brokers. The UNI token and liquidity provider (LP) tokens may be viewed as investment contracts. On May 22, Uniswap Labs submitted a 40-page Wells response document, rebutting the SEC’s allegations. Uniswap Labs claims its protocol is a general technology platform, not specifically designed for securities trading, and that 65% of its trading volume involves non-securities assets (such as ETH, BTC, and stablecoins). Chief Legal Officer Marvin Ammori stated that the SEC needs to redefine “exchange” and “broker” in order to regulate it, and believes the SEC’s allegations are based on incorrect classification of the tokens.

Regulatory Relaxation Period (2025 to Present): On February 25, 2025, the SEC announced the termination of its investigation into Uniswap Labs and will not pursue enforcement actions. Uniswap Labs announced this outcome on X, calling it a “major victory for DeFi” and emphasizing the legitimacy of its technology. This event reflects a shift in the SEC’s attitude towards crypto regulation following the Trump administration’s arrival. On April 8, 2025, the SEC invited companies such as Uniswap Labs and Coinbase to participate in a crypto roundtable to discuss crypto trading regulation. On May 5, 2025, several Republican members of the U.S. House of Representatives Financial Services Committee and Agriculture Committee jointly released a new discussion draft on crypto industry regulation, continuing and expanding upon the core content of the previous “Financial Innovation and Technology Act for the 21st Century” (FIT21 Act), further refining and extending the regulatory framework for digital assets. The new draft’s page 49 aims to clarify that as long as transactions involving the sale of digital goods do not involve the buyer acquiring ownership rights in the issuer’s business, profits, or assets, these transactions do not constitute securities. The House plans to release an updated text of the Lower House Digital Asset Market Structure Bill on May 29. The updated text follows the discussion draft released on May 5, and this advancement of market structure legislation is widely seen as the foundational blueprint for the future of U.S. regulation and trading of digital assets. The House will review the crypto market structure bill on June 10.

Currently, with the SEC effectively terminating its investigation into Uniswap Labs in early 2025, along with the definition of what does not constitute a security in the current cryptocurrency market structure bill, Uniswap’s current token economics scheme means that UNI no longer faces the risk of prosecution. With Trump and his administration coming into power, the direction of cryptocurrency regulation aims to design the classification methods for crypto assets, the Howey Test, and the division of regulatory agency functions to adapt to the development of the crypto industry, and to discuss with the leading crypto teams in the U.S. Uniswap Labs also plays an important advisory role in this, and after a comprehensive deregulation, there may be further expectations of favorable regulation in the future.

Project business situation

Top business data

Uniswap is the earliest and largest Dex protocol in the cryptocurrency market, with a current TVL of $5.12 billion and a trading volume of $84.5 billion over the past 30 days, ranking second after Pancake. Before the launch of Binance Alpha, Uniswap’s trading volume long ranked first in the entire market, generating $929 million in revenue over the year, ranking seventh. If calculated simply based on traditional valuation, the P/E ratio is around 4.5–6.4, while Coinbase’s P/E is approximately 33–42, Apple’s P/E is about 28–35, and Tesla’s is around 50–70. If in the future the “fee switch” of UNI can be activated or regulatory relaxation allows it to expand its financial application scenarios (currently holding UNI does not participate in profit distribution), the current market value is significantly undervalued relative to its business profitability.

According to the Uniswap Foundation’s Q1 2025 financial summary, as of March 31, 2025, the fund holds $53.4 million in USD and stablecoins, 15.8 million UNI (valued in UNI), and 257 ETH, which is equivalent to $150 million in tokens based on the closing exchange rate on May 28, 2025. The expected fund turnover period will last until January 2027, and it currently has a good financial condition.

Tokenomics Empowerment Attempt

In the past token economics of UNI, the main methods to generate returns from UNI were to add UNI to specific paired trading pools as LP, stake UNI to participate in DAO governance to propose buybacks or liquidity incentives. However, these returns were mostly indirect and in many cases had lower yields. Directly holding UNI does not directly generate returns, which is also a major reason why the price of UNI tokens has not risen to a high level. However, Uniswap Labs has been making attempts to empower token economics, repeatedly proposing a Fee Switch. Due to regulatory risks, it has not been substantively passed or implemented. The latest Fee Switch proposal was restarted in February 2024, and passed a technical vote in May. In the second half of 2025, there is hope for further advancement in on-chain voting, combined with the gradual advancement of the regulatory framework. The Fee Switch may be activated in the future.

In addition to the fee switch, Uniswap’s newly launched Unichain also provides new application scenarios for UNI. Unichain is a Layer 2 (L2) Blockchain announced by Uniswap Labs on October 10, 2024, based on the Optimism OP Stack’s Superchain framework, with the mainnet officially launching on February 13, 2025. Uniswap Labs CEO Hayden Adams believes, “After years of building and expanding DeFi products, we have seen areas where the Blockchain needs improvement, as well as the conditions necessary to continue advancing the Ethereum roadmap. Unichain will offer the speed and cost savings achieved by L2, better cross-chain access to liquidity, and a more decentralized approach.”

Like other L2s, Unichain also has a network of validators, using UNI as the staking token. Node operators must stake UNI on the Ethereum mainnet to become validators in the UVN (Unichain Validator Network). The amount staked determines the probability of being selected for the active validator set. Earnings come from 65% of the net chain revenue (including base fees, priority fees, and MEV), distributed according to staking weight. Currently, the official has not directly disclosed the specific staking scale, but Uniswap Labs continues to support Unichain. If its yield and ecological scale gradually expand, more UNI staking will be introduced to become validators and earn rewards.

Token Status

UNI currently has a circulating market value of 4.2 billion, FDV of 6.7 billion, with the token fully circulated and approximately 37% staked and locked.

The contract open interest is 448 million, with an OI/MC of approximately 10.6%. The aggregated long-short ratio is 1.02, the long-short ratio on Binance accounts is 2.16, and the long-short ratio for large accounts is 3.87. More long positions are coming from large holders. Since the ETH price increase, UNI’s open interest has also been gradually rising, and the derivatives market is active.

In the spot K-line, during the pattern of ETH’s rise in November last year, UNI exhibited a similar trend to ETH in terms of shape, but with a volatility approximately 2-3 times that of ETH. However, in this round of ETH’s rise in April, both showed a similar trend in shape, but the increase of ETH was greater than that of UNI. If the market continues, UNI may have further potential for upward adjustment.

Summary

Since Trump was officially elected President of the United States in 2025, how to regulate and integrate the encryption industry has become the most important theme. As the largest Dex protocol in the current encryption market, how the U.S. regulates UNI will become a model for the entire industry. Uniswap Labs is also actively participating in the formulation of regulatory rules. Combined with the multiplier effect of ETH, it may usher in structural benefits. The project’s own business data occupies the market’s top position, with considerable profits and good finances. Through the advancement of Unichain’s projects and the proposal for fee switches, it may bring new empowerment to the token. If one is optimistic about the future market, UNI is one of the blue-chip targets worth paying attention to in the ETH ecosystem.

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