$MNDE Buybacks Off to a Hot Start as Marinade Burns 300M Tokens

Following the unanimous approval of MIP-14, Marinade Finance’s new buyback program has finally flared into life with $MNDE inferno.

On top of allocating 50% of protocol fees to $MNDE buybacks, Solana’s oldest staking provider just torched 300M tokens, currently valued at over $40M.

How does Marinade’s new buyback mechanic align token holders with the protocol’s growth and how does it compare with rival staking operators in the Solana ecosystem?

Marinade Buybacks Go Live

Earlier this week, on September 5, Marinade Finance announced the launch of its eagerly awaited buyback program, which promises to allocate 50% of all protocol revenue to purchasing $MNDE directly off the open market.

At the end of every epoch, 50% Marinade’s revenue is used to open a new buy order using Jupiter’s DCA mechanism. All accumulated $MNDE tokens are held in the Marinade DAO treasury, which is governed by token holders. 

At press time, the Marinade buyback wallet currently has over $80k allocated to recurring buys. This figure is expected to steadily increase until the first 30-Day order is complete, before stabilizing at a rate proportionate to Marinade’s revenue. 

According to DeFiLlama data, Marinade generated just over $1M in revenue throughout August. $MNDE holders can reasonably expect the value of recurring buys to rise to ~$500k over a 30-day period. Marinade’s revenue could further benefit from the approval of Solana ETFs and the subsequent inflows of capital from institutional partners like Canary Capital, which has already named Marinade as its official staking partner.

The decision comes as Marinade, so many other applications across the Solana network, seek novel ways of aligning token holders with the protocol’s success. With $MNDE buybacks driving value to the DAO treasury, $MNDE holders are also able to influence how funds are spent to help Marinade flourish long-term through governance.

$MNDE Buybacks to Outpace $JTO

With 50% of protocol revenue directed towards $MNDE buybacks and DAO wealth accrual, Marinade is arguably demonstrating a stronger commitment to token holders than rival staking provider, Jito. 

Despite approving a governance proposal that effectively doubled revenue flow, only 6% of Jito’s block engine and future BAM fees are allocated to growing the Jito DAO treasury.

Given current market dynamics, Marinade DAO is projected to buyback a larger share of its circulating supply than its Jito DAO competitors. Should Marinade’s September revenue be consistent with its historical performance in August, we can expect the DAO to purchase ~0.5% of $MNDE’s circulating supply.

Comparatively, Jito DAO’s value accrual mechanisms are more vague. Despite the DAO's recent purchase of $1M worth of $JTO, representing 0.14% of $JTOs circulating supply, Jito DAO’s support of its token is handled by an elected group of individuals termed the Cryptoeconomics Sub DAO.

$MNDE Up 35% Following Burn

As optimism towards a bullish Q4 punctuated by DAT purchases and SOL ETF approvals, markets have reacted well to Marinade’s historic burn and new buyback implementation. 

Since Marinade DAO burned 300M tokens, valued at around $40M, $MNDE has surged 35% to currently trade hands at $0.181.

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