The dYdX DAO voted on Sunday to give out $1.5 million in DYDX coins to token holders to boost adoption. The on-chain vote, which started on March 27 was completed on yesterday (on Sunday) and majority of members (94.17%) voted in favour of the incentive program.
Eligible users to receive free DYDX tokens
Last Thursday, March 27, the dYdX Foundation announced an on-chain vote exercise in which the community members were to engage. The incentive program plans to distribute $1.5 million in DYDX coins from the dydx treasury to eligible users – to reward users for their participation in the dydx ecosystem. With the vote, which was passed on Sunday, the incentive program will therefore allocate DYDX tokens to incentivise participation and use of the dydx platform.
While offering tokens to reward is a common strategy to attract users and liquidity at DeFi projects, some market analysts criticize it as an inefficient approach. They claim that this tactic attracts users who come to collect free coins and then move on to other projects once the incentives end.
DYDX buyback program
DYdX is a major decentralized derivatives exchange that allows users to trade perpetual contracts for more than 35 prominent crypto assets. Last week, its native token, DYDX, grew 10% to $0.72 after the derivative exchange rolled out a buyback program designed to reinvest in its ecosystem to improve governance and security.
After the announcement, DYDX rose over 10% and was hovering at around $0.731. As per today’s data, the asset’s value is down 11.10% and 10.4% over the past week and one month ago, respectively.
This buyback program allocates 25% of the protocol’s net fees to repurchase DYDX tokens from the open market every month. As per 2024 revenue metrics, this strategy could to lead a remarkable $11 million worth of DYDY tokens repurchased annually.
This plan is part of a wider commitment to strengthen the token’s role in the protocol’s security and economic model amid an extended downturn for DYDX, which has erased over 78% of its value in the past year.
