Key Takeaways:

UNI, Uniswap’s governance token, surged 46% to over $17, reaching a two-year peak amid a significant proposal for fee redistribution.
The proposal by the Uniswap Foundation aims to enhance community involvement by allocating protocol fees to UNI token holders, receiving strong support from the community.
Trading volume for UNI soared 120% in 24 hours to $1.18 billion, and its market cap increased by 44% over the week to $9.4 billion, making it the 16th-largest cryptocurrency.
Whale accumulation and increased network activity signal growing adoption of the Uniswap ecosystem and higher demand for UNI tokens.
Despite the rally, there’s caution due to the Relative Strength Index (RSI) indicating potential overbought conditions, which could lead to a trend reversal.

The enthusiasm for a proposal to share fees among Uniswap users seems to be fueling a significant rally for UNI, pushing it to a two-year high. With a 46% increase, the governance token for the Uniswap decentralized exchange has reached over $17, a figure last observed in January 2022.

This surge comes alongside a dramatic 120% increase in trading volume within the last day, hitting $1.18 billion. Consequently, UNI’s market cap has grown 44% over the previous week, reaching $9.4 billion and ranking it as the 16th largest cryptocurrency by market cap.

This rally follows the Uniswap Foundation’s proposal for a protocol governance upgrade aimed at fee redistribution to enhance community participation. This upgrade specifically intends to benefit UNI token holders by redistributing protocol fees to them.

UF's proposal to upgrade Uniswap Protocol Governance has garnered a lot of support from both delegates and the broader community.

The next step is a Snapshot poll to gauge community sentiment. The poll will run for five days here: https://t.co/Nlg14bJuIy https://t.co/92G1CqjjpO
— Uniswap Foundation (@UniswapFND) March 1, 2024

The Uniswap Foundation’s announcement on February 23 highlighted the plan to reward UNI holders who stake and delegate their tokens, proposing changes that would facilitate permissionless and programmatic fee collection.

The community’s response has been positive, indicating support for the proposal, which aims to improve Uniswap’s governance structure and engage UNI token holders more actively in decision-making.

Voting on the proposal began on March 1 and is set to conclude on March 7, with unanimous support so far from the community.

Further fueling UNI’s demand, blockchain data reveals significant accumulation by a whale and heightened network activity, indicating increased Uniswap ecosystem adoption.

Giant Whales is accumulating $ARKM and $UNI!

Whale"0x3794" withdrew 1M $UNI($12.5M) from #Binance in the past 2 days.https://t.co/KZzZGG4u0D

Whale"0x81DA" withdrew 4M $ARKM($9.68M) from #Binance in the past 24 hours.https://t.co/SfylmkAAJq pic.twitter.com/VR9dMy7xrd
— Lookonchain (@lookonchain) March 3, 2024

UNI’s price surge from $7 on February 23 to an intraday high of $17.03 on March 6 showcases a robust buyer’s market, despite potential overbought conditions signaling a possible trend reversal.

The market’s next focus is likely on whether UNI can sustain its momentum to challenge higher resistance levels.