Optimism DAO Proposes Monthly OP Buyback Program to Strengthen the Ecosystem

The Optimism governance community is debating an initiative that could transform how the protocol manages its revenue. The core proposal is to dedicate 50% of the revenue generated by Superchain to a monthly buyback program of the native token OP, a strategy that has divided opinions among delegates and DAO participants.

Buyback Proposal Details

The initiative aims to establish a systematic and predictable buyback mechanism, executing regular off-market token purchases. This approach contrasts with ad hoc decisions, allowing greater transparency in how Optimism uses a significant portion of its operational income.

The plan specifies that monthly funds would be allocated to purchase OP on the open market. With the token currently trading at $0.26, the projected buyback volume could be substantial depending on the level of Superchain revenue in each period. The monthly frequency would also create a predictable pattern that could influence the protocol’s market dynamics.

Community Positions on the Buyback

Proponents of this buyback argue that it is a proven mechanism to strengthen the token’s price and demonstrate institutional confidence in the project. From their perspective, using revenue to buy back OP directly aligns the protocol’s interests with its holders, rather than accumulating reserves in stablecoins or ETH.

On the other hand, critics express fundamental concerns about fiscal sustainability. They warn that dedicating 50% of revenue to buybacks could gradually deplete the DAO’s capital, limiting its capacity to fund development, security audits, and marketing initiatives. Additionally, they question whether off-market purchases will have the desired effect on the market price, suggesting that the market could quickly adapt its expectations.

Implications for Price and Protocol Stability

The actual effectiveness of the buyback will depend on multiple factors. Consistent purchases could act as a price floor, especially if trading volumes are low. However, if Superchain revenues decline or the crypto market faces periods of volatility, this strategy could become a drain on resources without notable price benefits.

The decision made by Optimism DAO in this vote will set precedents for how Layer 2 protocols manage their revenue in the future. Both the success and failure of the monthly buyback program will be closely watched by other decentralized autonomous organizations facing similar capital allocation decisions.