I missed the earlier proposal “Revamping Tokenomics: Lowering Staking Inflation to 8% and Increasing Buyback/Burn to 70%” while it was open. This post is very similar in direction, so I’m writing this in hope of continuing the discussion. The core idea I support is simple:
A meaningful percentage of the buybacks should be burned instead of all of them going to the Litterbox, and lowering ASR to 8-10%
Why This Matters
Right now, 50% of revenue buys JUP and those tokens go into the Litterbox. That takes them off the market for now, but they still exist and can be released later. This creates ongoing uncertainty. I also support lowering ASR into the 8-10% range. The current high rate adds a lot of tokens into circulation and is only working AGAINST the buybacks. To me, this is very important.
What I’m Suggesting
- Keep using a large share of revenue (50% or higher, ideally 65-70%) to buy JUP
- Burn a fixed percentage (30-50%) of those bought tokens instead of sending them all to the litterbox. (I do understand this would be burning 15-35% of total protocol revenue every period, but there are successful protocols that already do this at high percentages (e.g. Hyperliquid, Jito and GMX)
- The remaining portion can still go to the Litterbox if needed
- Lower ASR to the 8-10% range
This ties protocol usage directly to reduced supply. Higher volume = more tokens removed. It also removes the uncertainty of what happens to the accumulated buyback tokens at a later time.
Extra Benefits
- It makes the tokenomics easier to understand. People can see a clear link of volume and supply reduction.
- It reduces the need for future big one-time burns or emergency votes. The reduction happens steadily.
- It signals the team and community are serious about treating JUP like a real asset with scarcity, NOT just a governance and rewards token
- Other successful protocols that tie revenue directly to burns tend to get stronger long-term holder support
- Less selling pressure that comes from extremely high quarterly reward distributions
- It makes the buybacks more effective because fewer tokens are released into circulation every quarter
- This shifts the incentive from “farm high rewards and sell” toward longer-term holding
- It brings the staking yield closer to a sustainable level instead of one that relies on heavy dilution
This doesn’t require inventing something new. It just takes the current buyback system and makes part of it actually remove tokens for good.
Thank you, and I’m happy to hear thoughts from the team and others.