As a core native AMM and liquidity hub on Solana, Raydium has recently drawn renewed market attention. The main reason is that its 12% protocol fee buyback mechanism has repurchased an amount exceeding 30% of the circulating supply, making it one of the few on-chain assets backed by substantial real cash flow.
In terms of revenue and value capture, the RAY token directly captures a share of protocol trading fees. According to the official mechanism, 12% of the trading fees generated by all standard pools, concentrated liquidity (CLMM) pools, and CPMM pools is automatically used by smart contracts to buy back RAY on the secondary market and deposit it into the treasury. According to DefiLlama data, Raydium generated $39.58 million in fees over the past 30 days and $3.97 million over the past 7 days, with total network TVL of approximately $1.24 billion. Over the past month, it injected approximately $4.75 million in real buyback demand into the secondary market.
In terms of tokenomics, according to data from CoinGecko and Tokenomist, RAY has a maximum total supply of 555 million tokens, with approximately 270 million in circulation, a circulating market cap of approximately $627 million, and an FDV of approximately $1.289 billion. Linear unlocks for the team and early institutional investors were fully completed in February 2024, leaving no significant VC sell pressure. The only remaining emissions are from the ecosystem mining reserve, released at a low rate of approximately 1.9 million tokens per year (annual inflation below 0.7%). According to Binance spot market data, RAY was most recently quoted at approximately 2.322 USDT.
Bull and bear case:
Bull case: First, unlock-related sell pressure has been fully cleared, and early institutional allocations have been completely released, leaving the circulating supply in a stable, fully unlocked state. Second, the token is backed by real cash flow, with the 12% fee buyback providing underlying buying demand directly tied to on-chain trading volume.
Bear case: First, revenue is highly dependent on speculative activity. If trading in Solana meme coins cools, fees and buyback momentum could decline significantly. Second, the repurchased tokens are not sent to a burn address, but remain in the treasury, and Raydium faces competition for market share from AMMs such as Meteora.
Conclusion and metrics to monitor:
The key metrics to watch going forward are whether Raydium's 7-day rolling fees on DefiLlama can remain above $3 million (equivalent to an underlying weekly buyback floor of approximately $360,000), and whether the DAO community will advance an on-chain proposal to burn the repurchased treasury tokens.
Personal views and information summary only; not investment advice. DYOR.
$RAY #Raydium #DeFi