GMX, an on-chain, permanent spot exchange, has announced that a proposal to change the platform’s revenue distribution model has entered the on-chain voting phase.
According to advertisement On July 31, the new revenue distribution model aims to boost the long-term value of the GMX token (GMX). Currently, the DEX protocol supports a model that allows for the repurchase and distribution of Ethereum (ETH).
What is happening?
The platform announced that the flash vote on the new “GMX Buyback and GMX Distribution” proposal has passed. As a result, the proposal has moved to the next stage – an on-chain vote that will give the GMX DAO community until August 4 to approve or reject it.
If approved, GMX will abandon the current revenue distribution model of “buy back ETH and distribute ETH.” Aside from boosting the value of the native token, buying back GMX instead of ETH will also preserve the real yield benefits for users.
Main proposals
However, the “GMX Buyback and GMX Distribution” proposal will provide users with the option to convert distributed GMX to ETH. This means that network fees will be stored in GMX and distributed in the same token, with users being able to convert directly.
According to the proposal details, the buyback contract will allocate one-seventh of the fee to buy GMX. This will happen every day for seven days, with the buyback price based on GMX’s Chainlink oracle price on Arbitrum (ARB) and Avalanche (AVAX).
The repo contract will also impose a premium on the revenue model, which is set to gradually increase from 0% to 5% over the course of the week.
GMX’s trading model allows liquidity providers to earn fees from spreads, financing and liquidation fees. DeFiLlama currently Ranks GMX is the 45th largest chain in terms of revenue and fees. Competing protocols include dYdX and Jupiter Perpetual Exchange.