The fact that dYdX announced the allocation of 75% of protocol revenue to buy back DYDX should have been an extremely positive signal — because buybacks usually help increase demand and support prices.
But in reality, the price of DYDX decreased by 2% on the announcement day and has decreased a total of ~56% since September 2025.
This creates a 'paradox' because typically:
Buyback = bullish (price increase)
But for DYDX, the price reacted negatively.
❗ Main reason: No accompanying TOKEN BURN mechanism.
Investors are concerned because:
🔹 Tokens bought back are not burned, but only staked.
→ That is, it does not permanently reduce supply.
🔹 Buyback not burn ≠ supply reduction
Although buyback creates demand, but:
Tokens still return to the market when unstaked.
Circulating supply does not decrease → does not create sustainable value.
Thus, the market does not see this as a 'real buyback'.
🔥 Compared to industry trends: DYDX is 'lagging' in supply reduction strategy.
DeFi is currently shifting strongly towards the model:
Buyback & Burn (buyback and burn)
Or
Broad burn – Retroactive burn – Revenue-based burn
Some major examples:
🔹 ether.fi: 'buyback & burn' program worth 50 million USD.
🔹 Uniswap: a major restructuring proposal includes large-scale token burning from protocol fees.
👉 These models reduce permanent supply, helping to increase the intrinsic value of the token in the long term.
📉 What about DYDX?
Buyback but not burn.
Tokens put into staking → can eventually return to the market.
Does not create a supply reduction effect.
Investors are concerned about the lack of real value accrual incentive.
Therefore:
The market reacts negatively → price decreases despite large buyback.
⭐ Conclusion: The price decreased due to the lack of 'permanent supply reduction', not because of weak buyback.
in the context of DeFi increasingly valuing:
Real revenue
Real buyback
Real burn (permanent)
The fact that DYDX does not burn tokens causes their strategy to be viewed by the market as not strong enough, not sufficiently 'value-affirming', even though the protocol's revenue is very good.
#BTC90kBreakingPoint #StrategyBTCPurchase #US-EUTradeAgreement @Eljaboom @Brc蛙蛙 @Uweb @Yar Sawyer $XPL
