I’m wondering what other’s thoughts are on diverting a proportion of what’s currently diverted toward stakers to a buyback and burn as well as $GNS distribution. As an example, currently GNS stakers earn about 60% of the protocol’s revenues. What if 40% went toward a buyback and distribution and 20% went toward an automated burn, on top of the burning mechanism present in the vaults?
They’re pretty similar, but with a bit of a psychological nuance. In both cases, the revenue is directed toward buying the tokens, directly increasing the market cap. In the distribute case, however, all revenue is directed toward the stakers with no effect on the total supply. Stakers could very well just take their $GNS rewards and sell on the market, effectively bringing us to where we are now, with a bit of extra friction.
With a partial burn, the proportion of revenue directed toward the burn is used to decrease the supply. This is effectively the same as spreading out all rewards to everyone, regardless of whether they’re staking or not. Stakers will receive a smaller amount of $GNS than if we only distributed GNS, which could reduce their willingness to sell.
If anyone has thoughts on this I’d love to hear from you