dYdX is allocating 25% of protocol fees to a buyback program, with governance discussions underway to potentially increase this to 100%.
DYDX, the token of decentralized derivatives exchange dYdX, surged nearly 7% to $0.72 following the platform’s introduction of a buyback initiative. The program dedicates 25% of monthly protocol fees to purchasing DYDX tokens on the open market.
This move aims to strengthen the token’s role in network security and economic stability, particularly amid a prolonged downtrend that has seen DYDX lose over 78% of its value in the past year.
The buyback program marks a shift in the allocation of protocol revenue, with 40% directed to stakers, 25% to buybacks, 25% to the market-supporting MegaVault, and 10% toward treasury initiatives.
According to a press release, dYdX generated $46 million in net protocol revenue in 2024 from over $270 billion in trading volume. Governance discussions are exploring the possibility of increasing the buyback share to as much as 100% of protocol fees.
Tokens acquired through the buyback program will be staked for “an extended period to enhance network security,” a dYdX representative told CoinDesk.
Supply dynamics for DYDX are also changing, with token emissions set to halve starting in June. Most DYDX tokens have already been unlocked, with the remainder scheduled to vest by mid-2026, according to the press release.
Additionally, a pending proposal may remove unbridged Ethereum-based DYDX tokens from circulation if they are not transferred to the dYdX layer 1 by June.
