BIT price flat as BitDAO seeks to change Bybit’s contributions to treasury
BitDAO’s BIT price was little changed on Thursday after the developers unveiled a new proposal for adjusting Bybit’s contributions to its treasury. The goal of this proposal will be to improve the token’s tokenomics and lead to more decentralization.
BitDAO proposes new Bybit contribution mechanism
In a statement, BitDAO, one of the biggest decentralized autonomous organizations (DAO), said that a core contributor had submitted a key proposal that will change its tokenomics. The proposal primarily targets the contributions made to Bybit, one of the biggest cryptocurrency companies in the industry.
The main part for the new adjustment will be to modify the Bybit contributions from a dynamic exchange-linked amount to a fixed scheduled amount for over 4 years. The schedule will start at 120 million BIT per month. To boost its tokenomics, the amount will halve every year.
Further, the new changes will help to retain Bybit’s contributions in the community instead of burning them. Burning is a process of removing tokens from circulation by locking them in an unopenable or inaccessible account.
Why this upgrade matters
The upgrade will have numerous outcomes. For one, it will help to increase the stability and predictability of BIT’s tokenomics. This will happen by having a clean schedule of Bybit’s activities going forward. Further, it will lead to more decentralization of BIT’ holdings and overall governance.
Most importantlt, it will reduce the number of BIT in circulation from about 6 billion to 3.3 billion in the next few years. Reduced supply of tokens tends to have a positive impact on a crypto token’s price. At the same time, BitDAO will have a 1.8x boost for its economics and voting power.
Bybit is an important part of BitDAO’s community. Over the years, it has contributed over $600 million USDT/USDC and 177k Ethereum to BitDAO Treasury. The statement said:
“BitDAO will continue to partner with Bybit in terms of product ideation, bootstrapping product development, BIT integration, and product distribution.”