Aster has enabled its Strategic Buyback Reserve where it buys back its tokens, automatically, on-chain in the form of $ASTER. The protocol currently divides 20-40% of day-to-day platform fees to buybacks and is adjusted to market possibilities. First buys have already been conducted off a separate reserve wallet, and this can be seen on-chain. This relocation initiates a major step of the Stage 5 Buyback Program that Aster previously announced, and indicates that the protocol is assured enough in its revenue base to entrench buybacks into their daily practices.
The mechanism of the update is straightforward, though it is quite effective: the more the trading the more the buybacks. With perpetual futures, the amount of revenue collected by users is automatically redirected to buy-back $ASTER on the open market. This leads to a perpetual demand cycle that directly links the use of tokens economics to the use of the platform. Aster is making buybacks an intrinsic protocol behavior rather than using emissions, incentives, or discretionary actions of the treasury.
The range of allocation can be adjusted dynamically to enable aggressive scaling of the system when it is heavily used and to be conservative when traffic is low. The model by Aster is also self-sustaining as opposed to the fixed buyback programs which may cripple treasuries. Since repurchases are financed by continuing fees generation, the program grows with increase and not with operational requirements. Decrease the supply in the market.
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