The DYdX Community Approves Revenue Sharing Proposal

The dYdX Foundation has announced that the community has approved a key proposal to implement a revenue-sharing mechanism.

The proposal, passed on Nov. 15, allocates 50% of protocol revenue to the MegaVault and 10% to the Treasury SubDAO. According to the dYdX Foundation, the expedited vote saw a turnout of 76.99%, with over 155 million DYDX representing 89% of the vote in favor.

dYdX’s holders voted on the proposal a few weeks after research and software engineering solutions provider nethermind published it in the community forum on Oct. 22. Targeted ecosystem aspects include DYDX tokenomics, and protocol competitiveness.

It’s omplementation will mean enhanced DYDX token utility, reduced emissions, competitiveness against competing protocols such as Hyperliquid.

Under the proposal, 50% of dYdX Chain’s revenue will go to the MegaVault, a feature that allows users to deposit the stablecoin USDC and provide liquidity in exchange for yield. This allocation will incentivize user participation and support the perpetual decentralized exchange when the protocol launches.

“We are proposing to route 50% of protocol revenue to the MegaVault because liquidity is a fundamental component of dYdX’s competitive advantage, and the TVL of the MegaVault should be as high as possible, while also balancing returns to stakers in exchange for the provision of network security,” the proposal reads in part.

While 50% of the protocol’s revenue is a significant amount, the community notes that the DEX will benefit if it maximizes liquidity. The 10% of protocol revenue set for the Treasury subDAO will be used to complement staking rewards.

The dYdX Chain, which launched on October 26, 2023, has generated more than $232 billion in trading volume. Meanwhile, more than $39 million has been distributed to validators and stakers.