dYdX Launches Token Buyback Program, Prices Booming
Key Takeaways:
- dYdX introduces a buyback program in which 25% of net protocol fees will be used to repurchase $DYDX tokens.
- The announcement immediately triggered a price surge, reflecting market optimism about the token’s future value.
- This step strengthens the ecosystem and benefits token holders as the protocol expands with additional features.
On Tuesday, the dYdX community announced its very first $DYDX Buyback Program, a move that created waves throughout the decentralized finance (DeFi) landscape and boosted the token’s price by as much as 10%. As of Tuesday morning, $DYDX is trading at approximately $0.72. This strategy suggests an intention of long-term ecosystem sustenance and value generation. By reducing the circulating supply and reinforcing investor confidence, the buyback program could also help stabilize price fluctuations, making $DYDX a more attractive asset for long-term holders.
How the Buyback Program Works
Central to the program is the commitment to use 25% of dYdX’s net protocol fees to perform monthly $DYDX token buybacks from the open market. Unlike previously expected, these repurchased tokens will be managed by the Treasury SubDAO, not burned, for yield. This is a meaningful change in how the protocol allocates its revenue. Previously, 100% of the platform’s revenue was distributed among ecosystem participants. With the new model, 75% of protocol revenue will be divided between Treasury SubDAO (10%), MegaVault (25%), and Staking Rewards (40%).
At current protocol fee generation, this new structure is expected to deliver approximately $4.4 million per year to the buyback program. A community vote in early March led to the decision of launching this program, which means that a significant percentage of users agree with the move. This democratic approach highlights dYdX’s commitment to decentralized governance, allowing token holders to have a direct say in the protocol’s financial strategies.
Buyback programs are generally seen positively by investors because they can reduce the circulating supply of a token, potentially increasing its scarcity and value. However, they can also be interpreted as a sign that a company lacks better ways to use its cash or is concerned about declining share prices.
Potential Expansion of the Buyback Program
This initial 25% allocation could be just a starting point. The dYdX community is already discussing the potential for increasing the buyback allocation to 100% of net protocol fees. If this were to happen, the decreased circulation of tokens would, in turn, increase network security even further. The goal is to encourage broader participation in the platform while ensuring that the token remains integral to the protocol’s long-term growth.
Traders Look for Further Upward Movement Based on Technical Analysis
In addition to the basic psychology of the buyback program, some technical indicators also suggest that this upward trend may continue. The daily chart’s Relative Strength Index (RSI) shows a bullish divergence, meaning that while the price creates a lower low, the RSI sets a higher high. This is often interpreted as a weakening downward momentum — or an early sign of a trend reversal. In addition, the MACD indicator just crossed bullish, providing another buy signal.
If this momentum is sustained, the $DYDX price could rise toward the $0.84 resistance level and potentially retest the $1.00 weekly resistance.
New Beginnings for the Protocol: dYdX’s Buyback Program
The buyback plan doesn’t exist in a vacuum. The release comes alongside a major upgrade for dYdX with the launch of Spot Trading, Multi-Asset Margining, and EVM Support powered by IBC Eureka.
The next DeFi boom could start as early as September — and last for months — according to dYdX Foundation CEO Charles d’Haussy. This will all be happening as we enter a new phase of growth and maturity for the platform, with all token unlocks expected to end around June 2026. Recognizing the significance of this cross-chain bridge, the dYdX community proposed discontinuing its support as early as June 2025. This decision would lead to the removal of unbridged ethDYDX tokens from circulation, further constraining supply.
dYdX was originally created on Ethereum in 2019 but has since developed its own Layer 1 solution using Cosmos, enhancing both speed and usability. Although the project has seen challenges over the years — including layoffs and a short-lived change in the role of CEO — dYdX has rebounded, continuing to innovate and cement its status as a top-tier decentralized exchange.
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