On March 26, 2025, the dYdX community, governing the decentralized perpetual contracts trading platform, unveiled the DYDX Buyback Program. This initiative aims to bolster long-term confidence in the DYDX token, fortify network security, and align the platform’s growth with its tokenomics.
Mechanics of the Buyback Program
Under this program, 25% of dYdX’s net protocol fees will be allocated monthly to purchase DYDX tokens from the open market. The acquired tokens will then be staked, ensuring continuous reinvestment into the ecosystem. The current distribution of net protocol revenue is as follows:
- 10% to the Treasury SubDAO for financial sustainability initiatives
- 25% to the MegaVault
- 25% to the Buyback Program
- 40% to Staking Rewards
Discussions within the community suggest the possibility of increasing the buyback allocation up to 100% over time, potentially reducing the circulating supply further.
Evolution of DYDX Tokenomics
As of March 1, 2025, approximately 85% of DYDX tokens have been unlocked, with emissions set to decrease by 50% in June 2025. The migration from Ethereum to dYdX’s Layer 1 in 2023 has reshaped the token landscape, with 86% of DYDX tokens now on the dYdX Chain and 14% remaining on Ethereum as ethDYDX. A proposal to discontinue support for the cross-chain bridge in June 2025 could lead to the removal of unabridged ethDYDX tokens from circulation, further tightening supply.
dYdX’s Recent Developments
In November 2024, dYdX launched “dYdX Unlimited,” followed by a revamped mobile trading experience in February 2025. Throughout 2024, the platform generated $270 billion in trading volume and $46 million in net protocol fees across 150 markets, pushing its cumulative trading volume past $1.46 trillion since 2021.
Community-Driven Governance
The Buyback Program was introduced through community governance, reflecting dYdX’s commitment to decentralization. Ongoing discussions about expanding the program’s impact highlight the active role of the community in shaping the protocol’s long-term economic model.
In summary, the dYdX Buyback Program represents a strategic effort to strengthen DYDX tokenomics, ensuring alignment between the platform’s success and the token’s value.
