Protocol Driven Buybacks (PDS)

This page goes into detail about the protocol aims to conducts buybacks of RZR

Protocol Driven Buybacks are a mechanism where the protocol actively purchases its own tokens from the market using revenue or even borrowed stablecoins (USD). Unlike user-driven speculation, these buybacks are executed strategically by the protocol itself.

The goal is not short-term price action, but to strengthen protocol-owned supply and protocol owned liquidity giving the system greater control and resilience over time.

When Do Buybacks Happen?

The protocol considers buybacks when it already has significant control over its own supply and liquidity. At that stage, buybacks become a rational strategy because they either:

• Allows the protocol to capture more supply directly, or

• Have little to no negative impact on its existing holdings.

In the ideal case, the protocol is trading in its own best interest, not for users. However, because the protocol and users are aligned, these actions ultimately benefit everyone. By consolidating more supply and liquidity into protocol ownership, the system becomes stronger, more sustainable, and more trustworthy.

There are two sources of funds that the protocol can tap into to perform buybacks

Borrowed USD Buybacks

At first glance, buying back tokens with borrowed stablecoins might appear risky. But when the protocol owns the majority of supply and liquidity, the downside is minimal. Any “leakage” from such a move translates into a small expected loss for the protocol, and a net gain for users.

In an ideal scenario, borrowed USD buybacks should only happen if and only if the protocols owns a very large majority of the supply and liquidity.

See the "Bank Run" risk.

Revenue-Driven Buybacks

Another source of buybacks comes directly from the protocol’s organic revenue streams — such as lending income, dex trading fees, and ETH staking yield. Unlike borrowed USD buybacks, these are far less restrictive and can be executed at virtually any time.

Because this revenue is continually generated by the system, it creates a natural cycle where protocol earnings are recycled back into buybacks.

This approach is sustainable, self-funding, and flexible. It doesn’t depend on leverage or external capital, and it allows the protocol to scale buybacks alongside its own growth.

See Revenue Sources.

The Bigger Picture

Protocol Driven Buybacks represent a shift from reactive tokenomics to proactive system building. The protocol isn’t passively waiting for the market to decide its fate, it is actively shaping its own future, consolidating power where it makes sense, and ensuring that in the end, both the system and its users win together.