Uniswap Founder Responds to v4 Fee Switch Controversy, Clarifies "LP Fee Reduction" Misunderstanding

July 29th, Uniswap founder Hayden Adams responded to the v4 fee switch controversy, clarifying that the "reduced LP fees" is a misconception. The protocol fee is additive rather than subtractive, and LPs still earn 30 basis points per trade. In response to the claim that the protocol takes 25% of LP profits, he stated that the protocol fee on a 30 basis point pool is 5 basis points, representing approximately 14% of the total trading fees, while LPs themselves have not seen a reduction in earnings.

Hayden Adams also pointed out that centralized exchanges (CEXs) charge 100 to 200 basis points per trade, making Uniswap's 5 basis point fee at the 30 basis point tier 20 to 40 times cheaper.