Projects are starting to buy back their own tokens. That’s the most honest signal in a bear market.
Prices have fallen this far, and there are half as many people shilling tokens. But some projects are doing something else: buybacks.
World Liberty Financial completed its first $1 million WLFI buyback, funded by management yields from its USD1 stablecoin reserves. Its previous $10 million buyback purchased 59 million tokens. After it was announced, the price briefly rose 8%—but it’s still 70% below its year-to-date high.
Frax has launched a burn engine that automatically uses protocol revenue to buy back and burn FRAX.
Maple’s buyback is underway, funded by management fee revenue. Its Q3 revenue is still growing.
These three things have one thing in common: the money comes from real revenue—not token issuance, not market making, and not hype.
Why do I care?
In a bear market, narratives are the cheapest thing around, and cash flow is the most valuable. A project’s willingness to use its revenue to buy back its own tokens is the only hard evidence of its confidence in its own valuation.
But don’t treat buybacks as a floor. $1 million is tiny compared to WLFI’s scale. It’s a signal, not a substantial amount. Buybacks can change the slope, but they can’t change the direction.
Three criteria for judging whether a buyback is useful:
The amount as a proportion of daily trading volume. Below 5% is basically just for show.
Can it be sustained? Once a month and once a day are completely different things.
Where does the money come from? If the buyback is funded by newly issued tokens, that’s just moving money from one pocket to another.
I think more projects will follow suit over the next month, because this is the only kind of good news in a bear market that doesn’t need a permit.
But the projects really worth watching are the ones that still dare to publicly share their on-chain buyback addresses after their prices have fallen 60%.
If they’re willing to let you check, that’s the real deal.
Prices have fallen this far, and there are half as many people shilling tokens. But some projects are doing something else: buybacks.
World Liberty Financial completed its first $1 million WLFI buyback, funded by management yields from its USD1 stablecoin reserves. Its previous $10 million buyback purchased 59 million tokens. After it was announced, the price briefly rose 8%—but it’s still 70% below its year-to-date high.
Frax has launched a burn engine that automatically uses protocol revenue to buy back and burn FRAX.
Maple’s buyback is underway, funded by management fee revenue. Its Q3 revenue is still growing.
These three things have one thing in common: the money comes from real revenue—not token issuance, not market making, and not hype.
Why do I care?
In a bear market, narratives are the cheapest thing around, and cash flow is the most valuable. A project’s willingness to use its revenue to buy back its own tokens is the only hard evidence of its confidence in its own valuation.
But don’t treat buybacks as a floor. $1 million is tiny compared to WLFI’s scale. It’s a signal, not a substantial amount. Buybacks can change the slope, but they can’t change the direction.
Three criteria for judging whether a buyback is useful:
The amount as a proportion of daily trading volume. Below 5% is basically just for show.
Can it be sustained? Once a month and once a day are completely different things.
Where does the money come from? If the buyback is funded by newly issued tokens, that’s just moving money from one pocket to another.
I think more projects will follow suit over the next month, because this is the only kind of good news in a bear market that doesn’t need a permit.
But the projects really worth watching are the ones that still dare to publicly share their on-chain buyback addresses after their prices have fallen 60%.
If they’re willing to let you check, that’s the real deal.