I honestly don’t see a reason for the fee switch to be turned on. Yeah, it’s clearly technically feasible, and your implementation makes sense - but that doesn’t mean we should go forward with development just because we can.
Here’s a quick overview of the benefits of turning on the fee switch:
- Uniswap DAO accumulates a larger treasury (they already have the second largest one, I suppose we could go for gold)
- I suppose the token price probably goes up a bit
Here’s my take on the downsides:
- The DAO has shown it’s quite bad at allocating funds efficiently - not that it’s the DAO’s fault. DAOs are just really difficult to operate as businesses (look at how complicated Maker has become to attempt to do so). So I’m not even sure we could use the money effectively, even if we wanted to.
- We’d be wasting a massive token price catalyst in the middle of a bear market.
- V3’s business license just expired. Turning on a fee switch and making it easier for forks to compete seems like a very bad idea. If the fee switch was turned on I’d bet the number of serious V3 forks doubles in a month. Why invite more competition without a very good reason?
- The legal and tax risks of turning on the fee switch are massive - and I don’t think it’s fair to skate over them in this proposal. The current administration is extremely crypto-hostile, Uniswap Labs is US-based, and rumor has it that Labs is/was being investigated by the SEC already. Why would we give the feds even more reason to come after Uniswap by making the token look more like a security?
If we want to move towards turning on the fee switch, I think a much better idea would be selling a portion of the UNI in the treasury. If it turns out the DAO can effectively allocate those funds and handle the legal and tax ramifications of the sale - then let’s start thinking about turning on the switch.