Uniswap (UNI), the governance token of the leading decentralized exchange (DEX) on Ethereum, has had a rough start to 2025. After briefly surging above $15 in mid-January, the price slumped back down to $13. However, a long-awaited upgrade to the Uniswap protocol, v4, is set to launch this week, sparking questions about its potential impact on the token’s price.
Uniswap V4 Upgrade: A Cause for Optimism?
The Uniswap v4 upgrade was first announced in June 2023, promising improvements to the core infrastructure and liquidity provision of the DEX. The community eagerly anticipated its deployment, expecting a positive effect on UNI’s price.
However, the recent price drop suggests that investors remain unconvinced. Several factors could be at play here.
Technical Indicators Point Towards a Downturn
From a technical analysis standpoint, UNI’s price is currently trading below two key Exponential Moving Averages (EMAs), the 20 EMA and the 50 EMA. This technical indicator is often used to identify trends, and a price positioned below both EMAs can signal a potential downtrend.
Resistance Levels Loom Large
Another cause for concern is the presence of significant resistance levels around $13.30 to $13.67, according to IntoTheBlock. At this price range, a large number of tokens were previously purchased, indicating areas where investors might be inclined to sell for profits.
Based on these technical indicators and resistance levels, some analysts predict that UNI’s price could fall further in the short term, potentially dropping below $10.
Despite the short-term bearish outlook, Uniswap’s long-term prospects remain promising. The v4 upgrade could still bring significant improvements to the DEX, potentially attracting more users and boosting overall trading activity. This, in turn, could lead to a rise in the value of the UNI token.
Also Read: Uniswap and Ledger Partner to Enable Secure Token Swaps Directly in Ledger Live
Overall, the upcoming Uniswap v4 upgrade is unlikely to trigger an immediate price surge for UNI. Technical indicators and resistance levels suggest a potential short-term pullback. However, Uniswap’s long-term potential remains strong, and the v4 upgrade could lay the groundwork for future growth.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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