Publication Date: January 4, 2025
Author: BlockBeats Editorial Team

Over the past 24 hours, the crypto market has shown parallel development across multiple dimensions. The main topics of discussion revolved around reevaluating the effectiveness of token buyback mechanisms, defining actual protocol revenue, and deliberating Ethereum’s long-term scalability roadmap. Regarding ecosystem development, Solana has shifted its focus toward a “utility and privacy” narrative, community-friendly ICOs have garnered attention, and competition in the Perp DEX sector continues to intensify.

I. Main Topics

Controversy Surrounding Jupiter’s Decision to Halt Token Buybacks

Jupiter Exchange founder Siong initiated a discussion on X, proposing to halt the buyback plan for JUP tokens. Over the past year, Jupiter has spent more than $70 million on buybacks, but the token price has shown minimal improvement. Siong argued that these funds should instead be allocated to user acquisition incentives, such as new user subsidies and active user rewards, to drive ecosystem expansion.

The proposal quickly attracted community attention and overlapped with discussions on similar decisions by other projects, such as Helium’s cessation of HNT buybacks. Consequently, this spurred an industry-wide reflection on the effectiveness of buyback mechanisms.

Community feedback was highly polarized. However, most participants did not advocate for the complete abandonment of buybacks but called for structural reforms to make them more effective.

Anatoly Yakovenko (Toly) suggested converting profits into future claimable assets and implementing one-year staking rewards for long-term holders to extend the impact of funds and reinforce token value anchoring. Some users proposed using stablecoins like USDC (with a 25% APY) for staking incentives to mitigate short-term selling pressure. Detractors, however, pointed out that the root cause of weak prices lies in team unlocks and continuous sell-offs, rather than inefficiencies in buybacks. Jordi Alexander and others proposed introducing a dynamic buyback model based on the PE ratio to avoid “high-priced buybacks” and inefficient spending during overvalued periods.

Overall, the emerging consensus within the community is that buybacks are not inherently ineffective. However, in scenarios where tokens and equity are highly mismatched and selling pressure persists, their effectiveness is significantly diluted. While some are concerned that halting buybacks might accelerate price declines, many believe that prioritizing growth over defensive measures is the more pragmatic approach.

Discussions on Helium Halting HNT Buybacks

Helium founder Amir announced the suspension of HNT token buybacks, citing the market’s lack of response to such actions.

Helium and Helium Mobile generated combined revenue of approximately $3.4 million in October. However, Amir stated that instead of continuing buybacks, which are perceived as “ineffective expenses,” he prefers to allocate these funds toward user growth, such as expanding the mobile user base, increasing network hotspots, and driving carrier offload usage. It’s worth noting that Helium’s Data Credits continue to burn to support network offload demand, but token buybacks have been temporarily shelved until market conditions improve.

The community remains divided. Critics like Foobar condemned the decision, equating it to a refusal to share revenue with token holders and questioning long-term commitments to the project. Others suggested exploring revenue-sharing or dividend mechanisms to incentivize token holding, but Amir countered that such designs face regulatory challenges. Supporters argued that allocating funds toward genuine growth is more practical than throwing money “into a black hole.”

Some users highlighted that tokens from DePIN projects are often perceived by the market as “utility vouchers” rather than equity tools, leading to systemic undervaluation. Buybacks are effective only in the absence of significant selling pressure; otherwise, they merely create short-term “optical effects.” This discussion is frequently juxtaposed with Jupiter’s proposal, serving as a representative case of the perceived ineffectiveness of buyback mechanisms during bear markets.

“Solana Culture” as a Barrier to Effective Buybacks?

Amid the buyback controversies surrounding Jupiter and HNT, user Stoic Savage raised a more radical viewpoint, arguing that the issue lies not with buybacks themselves but with structural flaws within the Solana ecosystem. He described Solana as a highly “internalized” ecosystem where internal trading, team unlocks, and extractive tokenomics continuously negate any positive impact buybacks might have.

This opinion resonated strongly with parts of the community, many of whom agreed that Solana’s ecosystem suffers from long-standing issues like “moral bankruptcy” and “insider favoritism,” rendering buybacks almost inevitably ineffective. However, other users contended that attributing buyback failures solely to the mechanism lacks nuance, emphasizing that Solana’s challenges stem more from high emissions, frequent unlocks, and team sell-offs than from inherent flaws in the buyback logic. Critics like Wow Im Farming argued that some founders have turned to buyback narratives to obscure deeper flaws in token design.

Sentiment across the discussions skews pessimistic, with some users beginning to use ecosystems like Hyperliquid as comparative examples, stressing that buybacks can only deliver real value when structural selling pressure is absent.

Hayden Adams openly criticized Aerodrome’s revenue reporting practices, accusing them of being misleading. Aerodrome reportedly included 100% of LP fees as “protocol revenue,” which were then redistributed to LPs through token emissions, significantly inflating their reported income. Data shows Aerodrome recorded $434 million in “revenue” last year, but during the same period, it incurred approximately $800 million in incentive costs.

In contrast, Uniswap adopts a more conservative approach by taking only a small fraction of protocol fees (around $60,000 daily), emphasizing long-term sustainability over short-term flashy numbers. Tervelix labeled Aerodrome’s revenue as “illusory,” arguing that it represents gross revenue rather than net profit, whereas Uniswap adheres to a net profit model, allowing LPs to earn from actual fees rather than token dilution.

Aerodrome supporters countered by pointing out that Uniswap Labs itself relies on around $120 million in token emissions to sustain operations, effectively diluting holders as well. They also noted that Uniswap’s early-stage investments were substantial, leaving it in a prolonged “high-cost, low-revenue” phase.

The Uniswap camp emphasized that its model aligns more closely with infrastructure logic, enabling LPs to earn returns without relying on subsidies, making it viable for long-term operation. In contrast, Aerodrome’s approach was likened to “renting TVL,” with the risk of rapidly losing liquidity once incentives cease.

Emerging consensus:

Aerodrome is more “holder-friendly” in the short term but carries significant risks due to inflation and incentive reliance.

Uniswap’s growth is slower but better suited for long-term infrastructure.

The discussion also extended to other DEX platforms like Meteora and Jupiter, raising further questions about fee definitions and “actual revenue.”

Vitalik Buterin shared a detailed new year post reflecting on Ethereum’s key developments in 2025, including gas limit increases, zkEVM performance breakthroughs, and PeerDAS improvements to data availability. However, he emphasized the continued need for progress in usability and decentralization.

Vitalik reiterated Ethereum’s positioning as a “world computer,” aiming to build a trustless, censorship-resistant, and third-party-free application ecosystem. He highlighted the importance of privacy protection and “walkaway tests” (ensuring systems remain functional even after developers disengage). He framed Ethereum as a “rebellion” against subscription-based platform trends, with a focus on core infrastructure for finance, identity, and governance.

The community responded positively. Gabriel Shapiro expressed gratitude for Vitalik’s commitment to cypherpunk values, while the Milady meme saw renewed popularity as a cultural response.

Contrasting opinions also surfaced, with Richard Heart promoting PulseChain for its decentralization advantages and others suggesting ICP as a potential rival in the realm of fully on-chain applications.

Some users remarked on the role of meme assets (e.g., $PEPE) in bolstering Ethereum’s cultural and liquidity foundations. While the overall mood was optimistic, there were calls for further decentralization at the application layer, especially in front-end anti-censorship capabilities. Rip.eth summarized: “Ethereum remains, at its core, a rebellion.”

II. Major Ecosystem Updates

Solana Stream released its 2026 ecosystem outlook, shifting its growth focus from speculation to utility-driven narratives. The report highlights several upcoming upgrades, record-breaking stablecoin and RWA (real-world asset) growth, ETF-related capital inflows, and other catalysts.

Key narratives have been broken down into six directions:

1. Payments and Stablecoins: USDC, PYUSD, focusing on cross-border remittances and e-commerce payments

2. RWA Tokenization: Ondo Finance, BlackRock involvement, emphasizing compliance and institutional capital

3. AI Agents and Autonomous Finance: Nosana, io.net, supporting low-latency AI inference and computational scheduling

4. Privacy Infrastructure: Arcium, Umbra, leveraging ZK and confidential computing for privacy capabilities

5. Prediction Markets: Kalshi, Drift, serving as real-time information infrastructure

6. x402 Micro-Payment Protocol: Coinbase proposal for procedural and machine payments