Originally published on: December 16, 2024
Ether.fi, a leading DeFi protocol, is shaking up the game by proposing a unique reward system for its native ETHFI token stakers. In a recent announcement on the community governance forum, Ether.fi unveiled its plan to allocate a portion of protocol revenues towards buying back ETHFI tokens and distributing them to loyal stakers.
The proposal suggests earmarking 5% of protocol revenue for purchasing ETHFI tokens, which will then be distributed as rewards to stakers. This initiative aims to not only boost the utility of ETHFI but also strengthen its market presence and align user incentives with the growth of the Ether.fi ecosystem.
Described as a “starting point,” this move will initially benefit tokenholders who have staked ETHFI for at least a month. The final decision on this proposal will be determined by a tokenholder vote at the end of the week. Notably, Ether.fi already utilizes protocol revenues to buy back tokens from the primary liquidity pool.
Ether.fi, known for its liquid restaking protocol, has earned its position as the fourth most popular DeFi protocol with an impressive total value locked (TVL) of nearly $10 billion, as reported by DefiLlama. Restaking, a strategy gaining popularity in the DeFi space, involves using staked tokens to secure other protocols concurrently, offering users the opportunity to maximize their returns.
The DeFi landscape is heating up, with aggregate TVL nearing all-time highs and protocols like Ether.fi paving the way for innovative reward structures. As the industry evolves, DeFi projects are under increasing pressure to share protocol revenues with tokenholders, mirroring trends seen in projects like Ethena and Aave.
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