GMX proposes switching revenue distribution from ETH to GMX token buybacks.
On-chain voting for the proposal is open until August 4 for the GMX DAO community.
The new model aims to boost GMX token value and maintain user real-yield benefits.
GMX, a prominent on-chain perpetual and spot exchange, has initiated an on-chain vote for a significant proposal aimed at revamping its revenue distribution model.
Announced on July 29, the proposal dubbed “Buyback GMX and Distribute GMX” seeks to enhance the long-term value of the GMX token by shifting from the current “buyback ETH and distribute ETH” model to a “buyback GMX and distribute GMX” approach.
Proposal passes snapshot vote enters on-chain vote stage
The proposal has successfully passed the initial snapshot vote and has now moved to the on-chain voting phase.
The ‘Buyback GMX and Distribute GMX’ proposal, which would change the current revenue distribution model, has passed a Snapshot vote. It now moves on to an on-chain vote by the GMX DAO on Tally:
🔸 https://t.co/2U7HjWvv6r
Delegates, please review the proposal and vote now.
1/3 pic.twitter.com/yzcIKAL4md
— GMX 🫐 (@GMX_IO) July 31, 2024
The GMX DAO community has until August 4 to cast their votes on this crucial change. If approved, the new model will not only boost the native GMX token’s value but also maintain real-yield advantages for its users.
What is the Buyback GMX and Distribute GMX all about?
Key elements of the proposal include an option for users to convert distributed GMX to ETH, providing flexibility in how they receive their rewards. The revenue distribution process will involve allocating a seventh of the fees towards daily GMX purchases over seven days.
These purchases will be based on GMX’s Chainlink oracle price on Arbitrum and Avalanche, ensuring fair market value transactions.
Additionally, the buyback contract will introduce a premium to the revenue model, starting at 0% and gradually increasing to 5% over the week. This mechanism aims to add further value to the GMX token over time.
GMX’s trading model already allows liquidity providers to earn fees from spreads, funding fees, and liquidations. The proposed changes are expected to strengthen these incentives by directly tying revenue distribution to the platform’s native token.
Currently ranked as the 45th largest chain by revenue and fees according to DeFiLlama, GMX faces competition from other decentralized exchanges like dYdX and Jupiter Perpetual Exchange.
The outcome of this vote could position GMX more favourably in the DeFi space, enhancing its appeal to both users and investors.
The GMX community eagerly awaits the results of the vote, which will determine the future direction of the platform’s revenue distribution strategy.
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