Uniswap with its token UNI it's a defi Juggernaut and it did very well during the Defi Summer of 2021. After that the total value locked of the entirety of decentralized finance had massive pump and dump and with it of course the total value locked of UNI didn't looked much different.
Looking at the relative valuation of UNI here are a few points to consider:
- UNI token vs ETH, since the liquidity pools are against wrapped ETH. UNI underperformed ETH by almost 90% since May of 2021 to May of 2022 then went pretty much in a sideways trading range. This leaves us in today's market with a risk of ~25% vs and a potential reward of ~90% vs ETH. The reason for the initial dump is simple: TOKENOMICS. The supply of UNI grew from 150 mil. tokens in 2021 to 990 mil. today approaching maximum circulating supply so the inflation pressure is starting to disappear.
- Uniswap is trying to stay ahead of the competition with their V4 update which is supposed to increase customizability, efficiency and flexibility (read more about it on their website)
- Regularization of Uniswap. Because Uniswap is already the largest decentralized exchange it's actually not that decentralized anymore. Uniswap does follow regulation and does block certain assets and so they try to comply with regulation but they also taste the downside of it.
Personally I see a bright future for the token. Sources: https://docs.uniswap.org/contracts/v4/concepts/intro-to-v4 https://token.unlocks.app/uniswap Show Less
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