Memes

Messari: The Bear Case for Token Buybacks

“Programmatic and indiscriminate buybacks lead to poor capital allocation practices”

> They fail to impact price action & hinder growth during downturns.

> RAY, GMX, GNS & SNX programmatically bought back millions in tokens now worth way below cost

> The mindset is to prioritize growth or real value distribution to holders in the form of stables/majors

Source:

Token buybacks have failed to prevent sharp price declines (h/t @defi_monk) https://t.co/wNRYcP3nPX

RAY, GMX, GNS and SNX have programmatically bought back millions in tokens which are now worth way below cost.

This is the programmatic token buyback fallacy:

1. Irrelevant to price action which is driven by revenue growth and narrative formation.

2. When revenues are strong https://t.co/4G6wBFHcgF

MONK

Messari: The Bear Case for Token Buybacks

“Programmatic and indiscriminate buybacks lead to poor capital allocation practices”

> They fail to impact price action & hinder growth during downturns.

> RAY, GMX, GNS & SNX programmatically bought back millions in tokens now worth way below cost

> The mindset is to prioritize growth or real value distribution to holders in the form of stables/majors

Source: https://x.com/defi_monk/status/1902761366395715640