One of the largest funding rounds in the decentralized finance sector has been closed by Uniswap Labs, which raised $165 million in its Series B round.
According to sources familiar with the matter, the protocol now has a total valuation of $1.66 billion after a round led by Polychain Capital, Andreessen Horowitz and Paradigm, followed by SV Angel and Variant.
The Fund Will be Used to Product and Become Financially Sustainable
Hayden Adams, founder of Uniswap, wrote in a blog spot on Thursday that he could never have imagined in 2018 when the protocol was first developed that it could support $1.2 trillion in trading volume.
“When I created Uniswap in 2018, it was an experiment to create an application that fully embodied the values of Ethereum. Over these 4 years, it’s grown more than I could have imagined. Today I’m so excited to announce that Labs has raised $165M in Series B funding,” Adams said on his Twitter account.
1/ When I created Uniswap in 2018, it was an experiment to create an application that fully embodied the values of Ethereum.
Over these 4 years, it’s grown more than I could have imagined. Today I'm so excited to announce that Labs has raised $165M in Series B funding 🦄 https://t.co/jMPvBBiG8L
— hayden.eth 🦄 (@haydenzadams) October 13, 2022
At the current time, the protocol is also not yet profitable, but Adams told Fortune Magazine the company would use its latest Series B raise to expand its product offering and become financially sustainable.
Recent votes by the Uniswap community supported the creation of a new independent entity, the Uniswap Foundation, distinct from Uniswap Labs but still a part of the Uniswap ecosystem, that will contribute to the protocol’s decentralized development and provide $60 million in grants over the next few years to community projects.
“We are thrilled to see more funding flowing into the Uniswap ecosystem, and are excited to see Labs continue to launch products that will help onboard the next billion users into web3,” said Devin Walsh, the CEO of Uniswap Foundation.
The Notion to Implement a Fee Switch
There has also been speculation about implementing a fee switch on the DeFi protocol, whereby the protocol would receive a tenth of liquidity pool fees from three key trading pairs namely the DAI-ETH 0.05% pool; ETH-USDT 0.03% pool; and USDC-ETH 1% pool, thereby reducing liquidity providers’ revenue.
In spite of Uniswap governance’s overwhelmingly positive vote in favor of switching fees, no action has yet been taken.
Nevertheless, Snapshot voting is an off-chain phenomenon rather than an on-chain vote that is binding.