Can UNI's Valuation Premium Hold Up After the Fee Switch Goes Live?

Whether Uniswap can turn today’s experiment into sustained trading volume will determine if UNI can maintain its premium.

Written by: Kunal Doshi

Compiled by: AididiaoJP, Foresight News

Note: This article is compiled from Blockworks analyst Kunal Doshi's report "The UNIverse Expands," which was first published on September 12, 2025. Doshi later supplemented the report with developments from the month following its release in the article "Uniswap's Two Sided Bet": The SEC's "innovation exemption" opens the door for tokenized U.S. stocks to be traded via AMMs and liquidity pools, with Uniswap dominating this trading layer; in early October, Sumitomo Mitsui Banking Corporation and Nethermind announced plans to build a compliant trading venue for Japanese investors on Uniswap v4, aiming for a mid-2027 launch. However, retail activity has cooled: the Robinhood ecosystem's memecoin boom has receded, with UNI down over 30% from recent highs, and revenue has declined for five consecutive weeks before stabilizing last week, with an annualized burn of approximately $92 million over the past 30 days. There are also rumors that Robinhood will launch a nine-figure funding and developer program. The data and judgments in this report are based on the September 12, 2025, perspective, so please be mindful of the timeliness when reading.

This report attempts to answer three questions: Can Uniswap leverage v4 to turn its first-mover advantage on Robinhood into more sustainable trading volume from tokenized assets? What does the fee switch mean for UNI, and is it at the expense of LPs? Where does Uniswap's valuation stand relative to its peers?

Uniswap Holds Its Ground

Robinhood is Uniswap's latest source of growth, but its trading volume has held up through several rounds of market activity shifts. Over the past two years, monthly trading volume has generally ranged between $40 billion and $60 billion; after the U.S. elections at the end of 2024 and during the DAT market in the summer of 2025, peaks approached $100 billion.

In the fiercely competitive DEX market, this resilience is particularly rare. Uniswap's share of total on-chain trading volume fell from 45% in January 2024 to 29% in August 2026, but it has begun to rebound in recent months.

In the last cycle, many protocols fell behind after activity migrated to new chains and applications. Uniswap did not repeat this mistake—wherever users flowed, it followed.

Following Community Trends, Migrating to New Chains

The changes in Uniswap's on-chain composition make this very clear. Ethereum remains its largest source of trading volume, but as activity has spread outward, its share has dropped from 60% in 2024 to 45% in August 2026. Base is an early example: it contributed only 1% of Uniswap's trading volume in 2024, but is now close to 10%. Despite fierce competition from Aerodrome, Uniswap has established a foothold on Base.

Robinhood is moving even faster. After just two months since its launch, this chain accounted for 22% of Uniswap's trading volume in August. In the last week of August, the average daily trading volume surpassed $1 billion, with tokens like PONS and AI creating a wealth effect that brought more traders and capital onto the chain.

This speculative wave has largely spilled over into tokenized stocks. Memecoins paired with stocks have become one of the main trades on-chain. On the last day of August, tokenized stocks contributed $220 million in trading volume to Uniswap, with Robinhood accounting for 87% of that.

Uniswap captured 92% of DEX trading volume on Robinhood, effectively taking the entire wave of activity. If Robinhood continues to be the center of speculative activity, Uniswap could play a role similar to Pumpfun on Solana—regardless of which token wins, it remains the primary beneficiary. For now, Robinhood is the most important engine for Uniswap's short-term growth.

V4 Opens Up the Next Market

Early versions of Uniswap focused on making token swaps more flexible and improving LP capital efficiency. V4 takes it a step further: developers can add custom logic directly to pools through hooks.

Since its launch in February 2025, the adoption of v4 has steadily increased, surpassing v3 in recent months and accounting for 54% of Uniswap's Ethereum trading volume. Other chains have migrated more slowly: v4 accounts for 12% on Base and 27% on Robinhood.

The composition of activity has also fluctuated significantly month by month. In July, memecoins and stablecoins accounted for 52% and 29% of v4 trading volume, respectively; by August, the memecoin share dropped to 8%.

Most v4 activity still comes from standard pools. In most months, hook trading volume only accounts for about 1% of v4, rising to 14% in August. This spike is partly due to pools showing clear signs of wash trading, so the surge in August should be viewed with caution.

Currently, stablecoins provide the clearest evidence: a major category can migrate to v4 on a large scale.

Why Stablecoins Are Shifting to V4

In the stablecoin market, among the ten trading pairs with the highest trading volume on Uniswap v4 over the past 30 days, eight are stablecoin pairs.

Stablecoin trading volume dominates v4 because these trading pairs are extremely sensitive to execution costs, and v4 excels at minimizing costs. The fee structure of v4 is flexible, supporting ultra-low fee pools: the fees for major stablecoin pairs are around 0.0005% to 0.0008%, while the minimum fee tier for v3 is 0.01%.

Additionally, v4's singleton architecture and flash accounting reduce the costs of routing trades across multiple pools. This is especially useful for Uniswap routers and external aggregators—they direct trades to the optimal path. In July, about 40% of Uniswap's trading volume and about 20% in August flowed through these channels, with most directed towards v4.

With lower fees and cheaper routing, stablecoins have become one of the first major use cases to migrate to v4 on a large scale. The hooks are expected to allow v4 to surpass conventional token swaps.

What Developers Are Building with Hooks

Hooks allow developers to customize the fee structure, liquidity management, and trading execution rules of pools. Features that previously required a separate protocol can now be directly built into Uniswap pools.

MEV Internalization: Angstrom and Kyber use v4 hooks to capture some of the value that would have flowed to arbitrage bots and return it to LPs. Angstrom charges MEV-related fees during swaps; Kyber captures arbitrage profits and shares them with liquidity providers.

Dynamic Fees: AEGIS adjusts fees based on market conditions—charging higher fees when volatility rises and LPs bear greater risks. It can also direct a portion of the fees into the protocol's own liquidity, gradually deepening the pool.

Token Issuance: Clanker uses hooks to manage token issuance, fee sharing, and MEV protection, while using Uniswap as the trading layer.

Application-Specific Markets: Unipeg has taken a different route, binding trading to the creation of on-chain generated art, making the pool itself part of the application.

This flexibility has already begun to appear in a batch of new speculative projects. Fake World Assets, Stonkbrokers, and NetNet Capital have all used v4 hooks to create products that are distinctly different from traditional AMMs. Flaunch and Pons v2 are also using hooks to build pairing markets for memecoins and tokenized stocks.

These projects are still in their early stages and have not yet generated enough organic trading volume to significantly impact Uniswap as a whole. However, they allow Uniswap to benefit from new experiments without having to create every application itself—developers bring products and custom logic, while Uniswap provides the underlying liquidity layer.

If speculative activity remains strong, we believe these projects may begin to compete for funding and attention with traditional memecoins. However, the larger long-term opportunity lies in applying the same flexibility to tokenized assets that can support more enduring trading demands.

Bringing More Traditional Assets on Chain

In August, tokenized assets accounted for 8% of spot DEX trading volume, but recent growth on Robinhood is still largely tied to speculation. To turn early activity into a lasting market, products need to be designed around the liquidity, compliance, and pricing demands of traditional assets. V4 has provided Uniswap with several ways to respond.

Permissioned Pools

Recently, Uniswap launched permissioned pools using v4 hooks. These pools allow compliance rules to be enforced directly at the pool level, including checking whether wallets are approved for trading or providing liquidity.

These controls are crucial for tokenized funds, stocks, and securities—issuers may need to enforce KYC, investor qualifications, and transfer restrictions. Permissioned pools allow regulated assets to access on-chain liquidity while retaining these safeguards.

Companies like Superstate and Securitize are involved in establishing this standard, making the model more credible. If more regulated assets go on-chain, permissioned pools could open up a new source of trading volume that Uniswap previously struggled to serve. However, as more assets go on-chain, Uniswap will also need sufficient liquidity to enable efficient trading for investors.

Associated Asset Pairs

As @haydenzadams recently stated, tokenized assets do not have to trade only against the dollar. Stocks can trade against indices, and gold can trade against silver. These assets often move in the same direction, with relative price fluctuations being smaller than those against the dollar. This can reduce impermanent loss for passive LPs and lower hedging costs for professional market makers.

Investors can still enter and exit through USDC, as routing is done automatically. A trade from USDC to Nvidia may first go through a deep USDC-SPY market and then route to the Nvidia-SPY pool.

This way, each stock does not need to maintain a deep dollar market. Passive LPs can provide liquidity for associated asset pairs, taking on less relative price deviation risk; professional market makers can focus on a smaller number of bridging pools that carry most of the trading volume.

This model is already running on Robinhood. On September 1, tokenized stocks paired with SPY generated nearly $20 million in trading volume, with many trades completed directly between stocks without going through the dollar.

The early high APR also indicates that LPs received good returns while seeding these markets, although yields are likely to decrease as liquidity floods in.

Most of these markets currently use standard v4 pools. Hooks could potentially introduce dynamic fees in the future or deploy idle liquidity into lending strategies. If this can lower market-making costs and help form deeper pools, tokenized assets could become a more enduring source of trading volume for v4. While Uniswap has a first-mover advantage, this market will not be exclusively theirs.

Leaders Are Constantly Changing

Uniswap has a first-mover advantage on Robinhood, but trading volume for tokenized stocks is shifting rapidly across chains. Most of the activity in June was driven by Solana, while BNB Chain became the largest market in July and August. Subsequently, as trading between memecoins and tokenized stocks heated up, Robinhood's share increased.

This rotation indicates that the market is still in its early stages. Liquidity follows new coins and user activity, without being fixed to a particular chain or venue.

Outside of AMMs, Hyperliquid may become one of Uniswap's strongest competitors in tokenized spot trading volume. XStocks recently launched five tokenized stocks and ETFs on HyperCore in the form of a native spot market, including NVDAx, SPYx, and QQQx.

These assets trade through an on-chain order book, with visible depth, limit orders, and price-time priority rules. This structure is more familiar to professional traders than AMMs, although early momentum has been slow—before launch, XStocks generated only $7 million in spot trading volume on Hyperliquid over 21 days.

During the same period, Uniswap processed $1.6 billion in stock trading volume, showcasing its clear first-mover advantage. However, Hyperliquid's threat comes from the entire platform it has built around these assets.

Star gating on the HIP-3 testnet allows deployers to restrict opening or increasing positions to approved wallets. This feature currently applies only to HIP-3 markets, but it indicates that regulated operators can introduce KYC at the deployer level while keeping the rest of the platform permissionless. This could become another avenue outside of permissioned pools for v4 hooks.

Tokenized spot assets can also coexist with HIP-3 perpetual contracts and HIP-4 outcome contracts. Traders will be able to buy assets, hedge, and build more complex strategies on the same platform. This experience is closer to an integrated brokerage rather than an independent exchange.

It is too early to declare a winner. Leadership has rotated across multiple chains, and the market should be large enough to accommodate multiple venues. Uniswap has liquidity advantages today, but it must turn early trading volume into deeper markets and better applications to maintain its lead.

Monetization Pathways Have Opened Up

With the fee switch going live, this round of growth carries more weight for UNI. For years, Uniswap has handled one of the largest trading volumes in the crypto industry without distributing trading fees to the protocol. This situation has begun to change.

The fee switch will first go live in December 2025 on v2 pools and some v3 pools on the Ethereum mainnet. In 2026, it will expand to the remaining v2 and v3 pools on chains like BNB Chain, Base, and Arbitrum. Uniswap governance has also acted quickly, activating protocol fees less than a month after Robinhood's launch to monetize this surge in activity. Fees on v4 will be introduced more selectively, covering standard pools, continuous liquidation auction pools, and aggregator hook pools starting July 27.

The scale of destruction has also increased: the daily burn of UNI has approached $600,000, with $9.3 million burned in August, of which Robinhood accounted for 45%. The speculative activity driving Uniswap's trading volume has become a major source of demand for UNI.

Annualizing the burn volume from August equates to about $111.6 million in annual buybacks, translating to approximately 18.6 million UNI at current prices, about 3% of the circulating supply. Uniswap's annual growth budget is 20 million UNI, so at the August rate, the burn could offset most but not all of the new emissions.

Has the Fee Switch Hurt LPs?

The main argument against the fee switch is that it will reduce LP returns. If enough liquidity flows elsewhere, traders will face worse execution, and Uniswap may lose trading volume to competing DEXs.

The impact depends on which version of Uniswap is being used. For v2 and v3 pools, protocol fees are extracted from the total fees of the pool, reducing LP's share. An example from Uniswap's documentation is shown below.

But V4 uses a different formula:

S = F + P − floor(F × P / 1,000,000)

S is the total fee paid by traders, F is the LP fee, and P is the protocol fee. The last item is the only deduction from LP's share and is only a rounded magnitude. LPs retain almost all fees, while traders bear almost all P.

Thus, v4 allows Uniswap to monetize activity without directly taking protocol fees from LPs. The trade-off is that traders pay more; if competing venues execute better, trading volume may still flow out. Early data provides a useful test.

What Happened on Base

After the fee switch went live, Uniswap's trading volume on Base plummeted from about $370 million to $26 million. On the surface, this seems to support the claim that "higher fees drive away traders."

However, most of the lost trading volume was not organic. Before the fee switch, six traders accounted for 90% of Uniswap's Base trading volume, with 53% coming from a fake OpenAI/USDC trading pair. The median time between two exchanges was only six seconds, consistent with high-frequency wash trading characteristics. After the fee switch, traders faced an additional cost that did not flow to LPs, making running this bot unprofitable, leading to a sharp decline in trading volume.

Therefore, the decline in surface trading volume does not indicate whether regular traders have abandoned Uniswap. It mainly shows that the fee switch cleared out activities that could produce attractive numbers but brought little economic value.

Liquidity and Execution Have Remained Stable

Since most of the fee switches went live at the end of July, liquidity has also held up. Uniswap's TVL on the main chain has risen along with the market, without flowing to competing venues.

Execution quality has also continued to improve. Price impacts for native assets against stablecoins and stablecoins against stablecoins have decreased across different trade sizes. These two categories account for about 70% of Uniswap's trading volume.

So far, there is almost no evidence that the fee switch has caused LPs to incur losses significant enough to withdraw their investments or that it has led traders to receive worse prices. LPs have remained, execution has improved, and Uniswap has finally started generating protocol revenue. This is a rare win-win-win situation.

What UNI is Priced For

Uniswap's valuation is higher than the average and median revenue multiples of other DEXs and several leading revenue-generating protocols. This premium is understandable. Uniswap remains the dominant DEX, having maintained its position across multiple cycles, and now controls most of the trading activity on Robinhood.

Leaders in sectors like HYPE, MORPHO, and PUMP are also valued significantly higher than their closest competitors. The market typically assigns higher multiples to sector leaders with a certain moat.

In the short term, UNI will remain closely tied to Robinhood. Memecoin and tokenized stock activities have driven recent growth on this chain, with Uniswap capturing nearly all of its DEX trading volume. If Robinhood becomes one of the main investment venues in this cycle, UNI should continue to benefit.

The reverse is also true. Most speculative themes tend to cool down after a few months, and a decline in Robinhood activity will simultaneously reduce Uniswap's trading volume and token burns. The premium on UNI means there is less room for growth to fall short of expectations.

Looking at longer cycles, Uniswap needs to guide some of the users and liquidity brought in by speculation towards more sustainable markets. Tokenized assets present the clearest opportunity. Recent activities have brought stocks onto the chain at record scales, although much of this has been driven by memecoins paired with stocks.

Building a deep stock market that can sustain trading over the weekend would make this liquidity more useful. Constructing or integrating lending, options, and other products around the same batch of assets using hooks can help Uniswap compete with the integrated experience that Hyperliquid is advancing.

Risks

In our view, the biggest risk is that its dominant position on Robinhood is likely to attract competitors. For example, if speculative activity remains strong, Pumpfun has a financial incentive to bring issuance platforms and DEXs onto this chain. In the past 24 hours, Pons and Uniswap each generated about $1.6 million in revenue, just slightly lower than Pumpfun's $1.94 million. If Pumpfun can incentivize activity on its platform, Uniswap may lose some of the activity it currently captures.

Aerodrome is another threat in the EVM ecosystem. Its planned MetaDEX 03 expansion could provide another funding avenue for LPs outside of Base. AERO emissions could allow it to offer higher returns on large pools, thereby more rigorously testing whether LPs remain on Uniswap after the fee switch.

Early evidence from Base is encouraging. Real trading volume and TVL have stabilized, and execution continues to improve. However, this data covers a short time frame and predates the full rollout of Aerodrome's new mechanisms and Slipstream v3.

Conclusion

Robinhood has brought Uniswap back to the center of on-chain speculation. Its dominance on this chain has driven trading volume and UNI burns, while early data suggests that the fee switch has not materially weakened liquidity or execution quality.

Our judgment is that the next wave of speculation will extend beyond traditional memecoins. As risk appetite returns, investors are looking for newer, more experimental opportunities, many of which are built around the v4 hook. We expect hook trading volume to become a much larger part of v4 activity and a new source of growth for Uniswap.

In the long term, the bigger opportunity lies in building deeper markets for tokenized assets using the same hook infrastructure. Whether Uniswap can turn today's experiments into lasting trading volume will determine whether UNI can maintain its premium.