Proposal: Redirect 27% Buyback & Distribution Fees Toward GM GMX-USD Pool and Trader Incentives

Proposals
1

Summary

This proposal suggests modifying the current tokenomics distribution by redirecting the 27% of protocol revenue currently used for GMX buyback and distribution toward the GM GMX-USD pool, with the USD yield from that pool used for incentivizing trading activity and platform growth.
The goal is to strengthen GMX’s treasury utility, deepen liquidity, create a sustainable incentive structure for traders, and gradually reinforce the floor price of GMX without relying solely on static APRs.

Rationale

Over the past year, despite healthy trading volumes and consistent protocol revenue, GMX price performance has not reflected activity levels. The current buyback mechanism, while theoretically sound great, has not generated meaningful market impact or visibility. Also, it does not provide any benefit to the protocol.

This proposal aims to:

  • Create a more liquid and impactful use of protocol revenue;

  • Accumulate a strong GM GMX-USD position in treasury to stabilize GMX and support future GLV integrations (GLV : gmx-usd);

  • Use USD-denominated fees from this GM pool to fund targeted growth campaigns, trader incentives, and marketing;

  • Align the staking model with utility rather than passive yield, offering reduced trading fees to stakers instead of direct distributions.

Proposed Changes

  1. Redirect 27% of current buyback/distribution revenue:

    • Instead of being distributed to stakers as GMX buybacks, this portion is allocated to the GM GMX-USD pool.

    • The position grows over time, strengthening liquidity and treasury value, boosting the floor price for holders over time.

  2. Utilize USD yield from the GM GMX-USD pool:

    • USD fees generated (≈13% of GM pool yield atm) are directed to protocol growth initiatives such as:

      • Trading incentives and competitions

      • Marketing and product exposure

      • Reward boosts for new traders or new markets

  3. **Revise staking mechanics:
    **
    GMX stakers lock tokens and receive reduced trading fees as their core benefit (utility-based staking).

Benefits

More impactful capital allocation : Instead of passive buybacks, funds actively build liquidity and generate USD yield usable for protocol expansion.
Treasury growth : A growing GM GMX-USD position provides flexibility for future developments, incentives, or even GLV integration.
Floor price reinforcement : Accumulating GM GMX-USD creates consistent buy pressure and a stronger liquidity base for GMX. This is the reason for going GM gmx usd instead of GLV eth or BTC : holders losing the staking apr, it’s a good option for their profit.
Trader-focused growth : Redirecting USD yield toward incentives directly drives volume, OI, and user acquisition.
Long-term scalability : Once the GM GMX-USD pool reaches significant size, it can serve as a new GLV component, further compounding benefits.

Potential Concerns / Counterarguments

:warning: “Changing tokenomics scares long-term holders.”
→ True : but refusing to evolve has led to stagnation. The change is a strategic reallocation, not a disruption. It can be implemented gradually with transparent milestones.
Keep in mind please : Buyback and D program is not helping the volume of the plateform in any case. So argument being “we should focus on volume, and not tokenemic” is difficult to hear as this change would actually benefit the volume.

:warning: “Treasury is already large enough.”
→ The issue isn’t size, but efficiency. Idle or under-leveraged funds fail to attract new traders or improve GMX visibility. And having more treasury is never a bad thing.

:warning: “This may not directly benefit GMX stakers.”
→ Stakers gain reduced trading fees and indirect price support through stronger liquidity and volume growth. The health of the protocol ultimately sustains GMX value. Also, the floor price through - never to be sold GMX - bought is beneficial to holders.

:warning: “Price is low : now’s not the time to change.”
→ Sure, emotion is not a good drive for decision making. But stagnation is not great also. We have a year of datas about BBD. We can sit and rediscuss it. Also, reallocating during low valuation periods allows more accumulation and a stronger rebound potential when sentiment improves.

Conclusion

GMX’s strength has always been in its innovation - not inertia.
By refocusing part of our tokenomics toward liquidity growth, trader incentives, and treasury strength, we prepare the protocol for sustainable expansion rather than static yield.
This proposal does not “change for the sake of change” : it adapts tokenomics to the realities of a mature, competitive DeFi market.

TL;DR:

  • Redirect 27% of fees from buyback → GM GMX-USD pool

  • Use USD yield for trader incentives & growth

  • Stakers get reduced trading fees (utility)

  • Treasury grows, GMX gains liquidity and price floor, platform gains momentum

  • Aiming for a GLV : gmx usd market, making GMX token as the go to for liquidity in leverage trading.

Thanks everyone for reading.

2

I appreciate you and ChatGPT thinking this out , Harry. But despite your comment saying otherwise - it still reeks of “change for the sake of change”.

Look I get it. You’re not happy about the $GMX token price. The various changes made to the coin’s tokenomics in 2024 proved to be epically catastrophic, removing the incentives to not sell, removing the incentive of yielding a promising standard like ETH in favor of a deflationary coin, and most recently letting Q establish a monthly price suppression with the projects own revenue.

The whole situation is bonkers, and is unlikely to turn around, as competition in the perps market is growing and growing, and our competitors are seizing on the one thing that GMX can’t introduce as a matter a pride: points. The speculative upside of trading on Astor, Hyper, Lighter, etc isn’t something that “Come trade on GMX, you’ll get paid yield in a coin with zero organic buying pressure. Just a bot!”

Time and again, the community has rejected the fundamentals of markets & marketing. As long as Q, Tano, Kal and Snipemonke are still leading you down to $0, this isn’t going to change. Ironic, as they all touted the certainty of $GMX soaring to new ATH by dismantling the tokenomics that had us on an upward trajectory for years, even during 2021 to 2023 bear market. Go look in the telegram - every challenge put forth by Saulius or I was met with scorn at our surety that the coin would plummet in value if they went through with this.

So here we are in the present situation:

  1. The token is now going to crab its way to single digits, likely crabbing in the $7-$9 range as the other perps announce their airdrop campaigns

  2. The ringleaders of this debacle, despite screaming with certainty last year that their plans would catapult $GMX to new highs, will continue to exercise their positions in the telegram channels that price should no longer be discussed. Even in the price discussion telegram channel. It’s absurd cope. And you’ve seen it - “No more price discussion. Just focus on APY” is now the mantra of the mod that everyone acknowledges abuses his mod powers. Or my favorite - when $GMX crashed to $9 a few months back (not during the Great Liquidiation), Tano kept reminding his sycophants that “Ackshully, the price isn’t at ATL, you’re just forgetting the TGE, heh.” The price chat is merely the cope chat now.

Regarding your idea: It punishes the poor stakers/holders, many of whom have been in this project since Day 1, meaning they’ve been suffering for two years. Raising the floor price isn’t a meaningful tradeoff because you’re FURTHER REDUCING INCENTIVES FOR HUMANS (and not a bot) TO BUY $GMX, MUCH LESS STAKE IT.

I feel like so many of these terrible governance votes that get passed happen because some people still think the GMX platform exists in a vacuum. As if it’s the summer of 2022 and we’re fighting Uniswap & Ethereum for place in the fee’s leaderboard. The other perp dexes that have sprung up are beating the shit out us for one reason: They’re providing prospective customers with incentives, and we are constantly and consistently removing them. Slashing the fee system would be just one more step towards the natural outcome of our current trajectory: Only a bot will be buying $GMX token.

If it’s any consolation Harrybo: You’re proposal is a very bad idea. So it will probably pass.

2 Likes
3

Personally dont think this proposal would do anything with regards to price action, do agree that incentivizing more traders back on the platform be better.

But i think in the grand scheme of things given we have TGE-ed it be hard to implement a points program, the only way i see it happening be GMX announces they will buy back GMX and use it for a airdrop for traders of the platform and a portion of the fee during that period goes back to increase the drop pool.

Or an arbitrum led initiative to help push traders back onto arbitrum. Maybe DRIP but its lending rn.

4

On your point here, I do agree that is one point which we cant compete on, as they use a points as a form of trading rebates and people are willing to burn fees in hopes of a higher return in the future.

Do think with current price action, we can buyback a good amount of circulating supply for a points program. Maybe contributors could comment ?

5

I will vote against such proposal. Being one of the top stakers. The buy back program will work over time. 2-3 years from now.

2 Likes
6

我很感谢你和 ChatGPT 考虑这个问题，哈利。

通缩经济学大约会在今年开始起作用，而你要做的似乎是在我们最低谷的时候放弃。

好的项目由于卖方越来越少和回购，他的内在价值不断提升。而如果我们取消了质押奖励，他就丧失了股东回报——他的内在价值就消失了，持有代币者不获得奖励，那么，项目再好和我们有什么关系呢？

7

Show some respect to the community by using English langauage, please.

8

Such behavior shall not be lolerated here.

10

cant agree more，a wonderful comment

11

fine，i thought man have translater software too，and my English is to poor too say my point，especially with professional word

好吧，我以为男人也有翻译软件，而且我的英语太差了，无法表达我的观点，尤其是专业词汇

1 Like
12

First of all, chatgpt is a nice tool for peiple not talking english on native langage. Altho, idea is all mine.

I agree about the point system. I put out there a gamified seasonal trading proposal, with elo farming for token rewards. But leaders are so afraid of changes, and focus only on “dev tech”.

As for "price oriented” proposal, this is the exact opposite.

BBD was a change with the promised of fixing token pricing. We focused on that, and not the plateform. Thats exacly why im doing the opposite.

We tried focusing on the token, it didnt do any good. So maybe we should start thinking about focusing on incentivize and liquidity.

By allocating the 27% to gm gmx-usd, it gives us more liquidity, more usd fees to use as marketing/incentivize etc.

Staking would still be an option for reduc trading fees. But you know what, staking is not even mandatory. I dont get why people get all upset about it. Thats why gm gmx-usd is chosen, to avoid having the token being useless, by providing a floor support proce over time. Thats not the priority lr focus about that proposal, but i bet it gives better result that bbd anyway.

Having a big glv gmx-usd pool with millions and millions of liquidity over time is nothing but beneficial for gmx volume, trading, incentivize or marketing through usd fees.

Still, i agree with leaders being out of touch of the market. Being developpement geniuses is not enough anymore in that web3 defi perp. Until they dont get that, we will be eaten slowly but surely. Waiting for dev update, as good as they are, wont fix anything.

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We already have plenty of liquidity ($400M+), which is barely utilized. Adding another $10m a year from fees will not change anything. And for your knowledge, the GM:GMX-USD pool does not generate any ‘USD fees’, but auto-compounds to itself. To get funds from it for marketing/incentives, you first need to redeem it and sell the GMX portion for USDC on market.

2 Likes
14

Hi! would like to have most or all the suggestions to be in the mother of all proposal thread.