Summary
This proposal introduces a new revenue allocation model designed to realign incentives, restore market confidence, and strengthen the long-term sustainability of the dYdX ecosystem.
Proposed structure:
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80% → DYDX Buyback Program
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15% → Staking Rewards
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5% → Treasury SubDAO
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0% → Megavault (decommission revenue share)
The goal is to prioritize DYDX token value recovery and perception, ensuring that protocol revenue is used effectively to support tokenholders, network security, and future growth.
Motivation
The DYDX token — once a symbol of innovation and decentralized trading leadership — is currently trading around 100 times lower than its all-time high and roughly 10 times below its listing price.
This decline has eroded community confidence and created a disconnect between the protocol’s strong fundamentals and the market’s perception of its value.
In Web3, price equals credibility. A weak token price communicates stagnation and discourages participation, while a strong price signals momentum, trust, and leadership.
The current undervaluation not only affects holders — it affects how new traders, liquidity providers, and partners view dYdX as a whole.
By significantly increasing the share of protocol revenue directed toward buybacks, we can actively reinforce the DYDX market, reduce sell pressure, and rebuild the positive feedback loop between token strength, ecosystem growth, and community trust.
Rationale
Allocating 80% of net protocol revenue to DYDX buybacks creates a powerful mechanism to support the token’s market price through consistent, transparent demand. This approach reduces circulating supply and anchors the token’s valuation to the protocol’s real economic output.
At the same time, 12% of revenue will fund staking rewards, maintaining strong incentives for validators and stakers.
8% will go to the Treasury SubDAO, ensuring stable operations, audits, and ecosystem initiatives.
The Megavault revenue share will be reduced to 0%. With a reported APR of approximately –27%, the Megavault no longer generates positive outcomes for users or the ecosystem. It can continue operating independently, but it should no longer draw from protocol revenue. These resources should instead strengthen the core token economy, where impact is measurable and strategic.
Implementation
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Redirect revenue to the new structure:
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80% Buyback Program (executed via TWAP purchases by Treasury SubDAO).
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12% Staking Rewards (distributed periodically).
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8% Treasury SubDAO Operations.
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0% Megavault.
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All purchased DYDX will be staked or delegated to validators, reinforcing network security and generating yield.
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Monthly transparency reports will detail buybacks, staking outcomes, and treasury expenditures.
Expected Impact
At current revenue levels, approximately $28–30M USD per year would be dedicated to DYDX buybacks — a scale large enough to meaningfully support the market and shift sentiment.
Expected outcomes include:
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Visible improvement in DYDX market stability and confidence.
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Higher staking rewards and validator participation.
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Sustainable Treasury operations with transparent management.
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Elimination of inefficient capital flows (Megavault).
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A restored sense of pride, credibility, and attention across the crypto space.
Conclusion
DYDX remains one of the most advanced decentralized trading protocols — yet its token trades at a fraction of its former value.
~100x below ATH and ~10x below listing price is not just a market statistic; it’s a signal that perception has diverged from fundamentals.
This proposal is about closing that gap.
By adopting the model — 80% Buyback | 12% Staking | 8% Treasury | 0% Megavault — we send a clear message to the market:
The community believes in the long-term value of DYDX — and we’re ready to back it with real economics.
A strong token builds a strong protocol. It’s time to make DYDX strong again.