dYdX Announces Buyback Program! What Does It Mean for the Ecosystem?

Starting today, 25% of dYdX’s net protocol fees will be used each month to buy back $DYDX tokens from the open market.

dYdX Approves Stage 1 of the Treasury SubDAO Buyback Program

The dYdX community has officially approved Stage 1 of the Treasury SubDAO Buyback Program, marking a significant step towards promoting long-term growth of the protocol. As part of this initiative, 25% of net protocol revenue will be allocated to buying DYDX tokens and staking them with validators, thereby strengthening network security.

Approximately $9 million worth of DYDX is expected to be bought back in 2025, aligning with the growing trend of buyback strategies among DeFi protocols. These programs play a critical role in increasing liquidity, balancing token supply, and encouraging governance participation.

How the Buyback Program Will Work?

The buyback initiative will be implemented in phases, with MegaVault’s revenue share being reduced from 50% to 25% to fund the buybacks. The purchased DYDX tokens will be staked through the Treasury SubDAO, contributing to network security and generating additional staking rewards that will be reinvested into the ecosystem.

Key Elements of the Buyback Program:

• 25% of net protocol revenue will be used to purchase DYDX from centralized and decentralized exchanges.

• The purchased DYDX will be staked with validators, increasing network security.

• MegaVault’s revenue share will be reduced from 50% to 25%, redirecting funds towards buybacks.

• $9 million in DYDX is expected to be bought back in 2025.

Why Buybacks Matter for dYdX?

Buybacks have become an increasingly common mechanism in the DeFi ecosystem to strengthen token economies. Platforms like Binance, Jupiter, and Hyperliquid have adopted similar strategies to build stronger connections with token holders, reduce circulating supply, and boost staking participation.

For dYdX, the buyback program offers several potential benefits:

• Strengthening network security: More DYDX will be staked with validators.

• Better alignment with token holders: Protocol revenue will be more directly tied to the value of DYDX.

• Long-term price stability: Continuous open-market purchases of DYDX can help stabilize price fluctuations.

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