What will happen to the 2.6 million ETH locked up in UNI’s liquidity mining?

The initial liquidity mining of Uniswap’s governance token UNI will come to an end. According to official news, Uniswap will end UNI liquidity mining at 8:00 on November 18.
Current data shows that the total locked amount of UNI liquidity mining fund pool exceeds 2.4 billion US dollars, including four ETH trading pairs. Since the UNI fund pool adds liquidity at a 1:1 ratio, the current locked ETH value exceeds 1.2 billion US dollars, which is about 2.6 million ETH at the current price of 465 US dollars.
The ETH locked in the UNI fund pool has two parts of income: UNI token rewards and transaction fee dividends.
The Uniswap V2 white paper shows that the Uniswap transaction fee is 0.03%, while the dividends distributed to liquidity providers are 0.05%. According to Uniswap.info data, the monthly transaction volume of Uniswap exceeded US$15 billion in September and exceeded US$8.6 billion in October.
Therefore, Uniswap's monthly fee dividend is also considerable. Although the dividend income will become higher as some users unlock ETH after the liquidity mining ends, it is conceivable that after the UNI liquidity mining ends, a considerable portion of the 2.6 million ETH locked in the UNI liquidity pool may return to the market.
However, the end of UNI liquidity mining seems to be a positive for the UNI token as UNI output will decrease, reducing selling pressure.
It is not known how much ETH will be unlocked. Wangarian, the manager of DeFiance Capital, made a simple estimate on Twitter a few days ago. Assuming that 50% of the locked ETH will leave due to the cessation of liquidity mining, there will be an outflow of ETH worth $600 million, about 1.2 million. This part of the outflow of ETH may have three destinations: 1. Pledged somewhere else, such as DeFI projects such as Sushi or ETH2.0; 2. Keep it in the wallet (unlikely); 3. Sell it and exchange it for other tokens. Wangarian believes that a large number of ETH will choose the third destination above, that is, sell it.
Therefore, the upcoming end of UNI liquidity mining has received widespread attention from the community and officials.
At 1 a.m. Beijing time on November 13, Uniswap officially held a community conference call to discuss many issues of concern to the community, such as the upcoming end of the liquidity mining plan and the future, whether to expand the existing plan or revise the plan, the comparative advantages of Uniswap and other DEX platforms once liquidity mining is stopped, and what new actions will be taken in the future.
It is reported that the community participation in this meeting was high, but the core issues of liquidity mining have not received a clear solution, and the recent development will be decided by community opinion leaders and voting.
On November 13, a Uniswap community member proposed in the official forum that the community should set up a working group to guide the UNI liquidity mining plan. The working group will mainly determine the specific plan for UNI liquidity mining. If the proposal can gain widespread attention from the community, volunteers may be recruited to discuss the specific structure of the working group.
Compound founder Leshner tweeted: When the incentives expire, the liquidity of DAI, USDC, USDT and WBTC will decline, and transaction costs will rise. Therefore, it is recommended that the community maintain incentives for the two most important liquidity pools ETH/USDC and ETH/WBTC. (Golden Finance)