Summary
The two core pillars of our work are protocol growth and token price performance. Protocol growth will be addressed in subsequent proposals; this proposal focuses on aligning the GMX team’s incentives with the long-term success of GMX itself.
A previous proposal shifted buybacks from immediate distribution to accumulated, unified distribution, ensuring that all token holders’ interests and objectives are aligned and maximizing returns for long-term holders. That measure addressed alignment at the community level.
This proposal is the equivalent measure for the GMX team. With the recent leadership transition and a renewed focus on execution, GMX Labs is shifting into a more startup-style operating mode. In that mode, team compensation should be structured the way high-conviction startups structure it: modest fixed pay, with the upside tied directly to the long-term success of what we are building. Every team member’s reward should follow GMX’s success not precede it.
Only if GMX succeeds will the team succeed.
Motivation
Today, GMX contributors are paid in a combination of USDC and GMX, with GMX making up a meaningful share of monthly compensation. Under the current mechanism, GMX is freely sellable on receipt. The result is that GMX, as it stands today, is functioning primarily as compensation not as a long-term alignment mechanism.
We want a model where team rewards are unlocked only when GMX itself succeeds, and where the team is rewarded after the community has been served.
Rationale
1. Eliminate Immediate-Sellable GMX Compensation
Going forward, GMX will no longer be issued to team members as immediately-sellable compensation. Team incentive in GMX will only come through the performance-triggered structure described below.
2. Performance-Triggered Team Rewards — 2,000,000 GMX in Two Tranches
The DAO authorizes a reserve of up to 2,000,000 GMX as a long-term team incentive pool, structured in two equal tranches each tied to a token price milestone. Each tranche unlocks only when its trigger is met:
- Tranche 1 — 1,000,000 GMX, triggered when the 30-day TWAP of GMX exceeds $100
- Tranche 2 — 1,000,000 GMX, triggered when the 30-day TWAP of GMX exceeds $1,000
Source of GMX: The source of funding to fulfill these obligations, if the milestones are met, will be decided by the DAO through a separate proposal at the appropriate time. Possible options the DAO may consider include:
- Newly minted GMX — up to the protocol’s maximum supply (inclusive of esGMX considerations)
- Existing GMX treasury reserves — excluding accrued staking rewards
- A dedicated buyback program — executed under favorable market conditions
This proposal does not prescribe a funding mechanism. That decision is explicitly left to the DAO and will be addressed through a separate governance process when needed.
Price oracle: The trigger will be evaluated using a 30-day TWAP from the Chainlink GMX/USD price feed to prevent gaming via short-term spikes.
Critically, every team trigger is set above the corresponding community trigger — community holders capture upside first; the team is rewarded only after the community has been served.
3. Distribution Principles
Each tranche, when triggered, is allocated across the team according to the following principles:
- The majority of each tranche is allocated to the CEO and Senior leadership, who carry the greatest accountability for GMX’s success.
- A meaningful share goes to the broader contributor base to ensure team-wide alignment.
- An outstanding-contributions allocation rewards exceptional individual impact during the period leading to the trigger.
- Time-weighted within pools so that earlier and longer-serving contributors receive a proportionally larger share than later joiners.
Detailed allocation percentages, pool definitions, time-weighting mechanics, and the contributor designation process will be administered by the CEO and leadership team under an internal compensation policy, with annual transparency reporting back to the DAO.
4. Vesting Schedule
All allocated GMX is subject to multi-year linear vesting from the trigger date of each tranche. The vesting structure is designed to ensure long-term alignment and gradual supply release.
The longer vesting periods apply to the most senior leadership roles, where accountability for long-term GMX success is greatest. The shorter vesting period applies to broader contributors. The specific mapping of roles to vesting tiers is administered by the CEO and leadership team under an internal compensation policy.
Each 1,000,000 GMX tranche vests according to the following structure:
- 50% of each tranche — vests linearly over 5 years (60 months) from trigger date
- 30% of each tranche — vests linearly over 3 years (36 months) from trigger date
- 20% of each tranche — vests linearly over 1 year (12 months) from trigger date
Supply impact: Maximum GMX entering circulation in any 12-month period from this program is approximately 800,000 GMX, and only in the most aggressive case where both tranches trigger simultaneously. In any realistic scenario where tranches trigger sequentially, annual circulation impact is substantially lower.
5. Departure & Clawback
The internal compensation policy will define how allocations are adjusted in the event of voluntary departure, termination for cause, or other circumstances. The DAO retains the right to revoke or claw back any allocation in the event of misconduct, fraud, or material breach of fiduciary duty.
CEO Compensation: $1 and Aligned With GMX
Q, as the incoming CEO, is committing to a base compensation of $1 per year in place of any USD-denominated cash compensation. His upside is tied entirely to his existing GMX position and his participation in the performance-triggered pool described above.
The math is simple:
- If GMX succeeds, the CEO’s existing GMX position appreciates significantly — that is more than enough.
- If GMX does not succeed, the CEO draws $1 and imposes zero compensation burden on the protocol.
Relationship to the 2026–2027 Funding Proposal
This proposal modifies the contributor GMX token allocation portion of the GMX Labs 2026–2027 Funding Proposal. Specifically:
What this proposal changes
- The 250,000 GMX contributor token allocation (~10,000 GMX/month linear distribution) approved in the 2026–2027 funding proposal will be terminated effective at the end of June.
- The grace period allows for an orderly transition of existing contributor compensation expectations.
- Starting from the end of the grace period, the new framework described in this proposal takes effect. From that point forward, no monthly GMX is distributed as compensation; team rewards in GMX flow exclusively through the performance-triggered tranches described above.
What this proposal does not change
- The operating funds portion of the 2026–2027 funding proposal ($7M annual floor / $9M annual ceiling, sourced from 8.8% net V2 protocol fees) remains in effect unchanged by this proposal. If adjustments to operating funds are needed in the future, they will be addressed through a separate proposal.
Effective Date
- Grace period: End of June 2026
- New framework effective: Day 1 following the grace period — concurrent with termination of the existing monthly GMX allocation
Accountability and Reporting
- When a tranche triggers, GMX Labs will publish a pre-distribution transparency report to the DAO showing the detailed allocation plan, including who receives what, vesting schedule per recipient, and the rationale for each allocation.
- GMX Labs will also provide an annual transparency report to the DAO covering allocations made under each pool, vesting status, departures, and any material changes to the internal compensation policy.
- The DAO retains revocation and clawback rights as described above.
- Any structural changes to tranche sizes, price triggers, or alignment principles require a new DAO proposal.
Conclusion
The team wins only if GMX wins. The community is served first; the team is rewarded only after the community has been rewarded. Every team member’s upside is tied directly to the long-term success of the protocol. The community is requested to review this proposal and and share feedback on the proposed performance-triggered incentive pool outlined above
