Lucía Peña
Decentralized exchange dYdX has announced a new initiative to repurchase its native token from open markets and stake the assets for improved network security. According to an official blog post, the buyback program will be executed through the dYdX Treasury SubDAO, utilizing 25% of its monthly net protocol fees.
This initiative, approved by a community vote earlier this month, marks a major shift in how dYdX distributes its revenue. Previously, all fees generated by the platform were allocated to ecosystem participants. Under the new fee structure, the funds will now be divided as follows:
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10% to the Treasury SubDAO
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25% to MegaVault
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25% for Buybacks
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40% for Staking Rewards
According to DeFiLlama data, dYdX’s annualized protocol fees stand at $17.5 million, meaning the exchange will allocate approximately $4.4 million per year to its monthly buyback initiative.
Buybacks Aim to Reduce Supply as Token Emissions Decline
Unlike traditional token burn mechanisms, dYdX will not destroy repurchased tokens but instead stake them through its Treasury SubDAO to earn additional yield.
The buyback program coincides with a planned 50% reduction in token emissions set for June 2025. The announcement highlighted that 85% of all $DYDX tokens had already been unlocked as of March 1, 2025, with the final unlocks scheduled for completion by June 2026.
Following the buyback reveal, $DYDX surged over 8%, surpassing $0.71 and pushing the protocol’s fully diluted valuation to $546 million.
dYdX’s Evolution and Strategic Shifts
Originally launched on Ethereum in 2019, dYdX provided margin trading for ERC-20 tokens before expanding its offerings in 2023 with the release of v3 perpetual futures contracts. To improve speed and efficiency, the protocol later migrated from Ethereum to its custom Layer 1 blockchain built using Cosmos technology.
Despite workforce reductions last year and a brief leadership transition where Founder Antonio Juliano stepped down as CEO, the platform has continued to roll out new features for simplified token issuance. Juliano has since resumed his role as CEO, after temporarily serving as Chairman and President.
With these strategic adjustments in place, dYdX aims to strengthen its ecosystem, reduce token supply, and drive long-term value for its stakeholders.
