# $AVNT Buyback and Burn.

Avantis operates a **systematic, revenue-linked buyback and burn program** that ties $AVNT token supply reduction directly to protocol revenue. This page covers how the program works, the fee allocation structure, verification methods, and the roadmap for scaling.

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### Overview

The Buyback & Burn program allocates a percentage of daily protocol trading fees to purchase $AVNT on the open market and permanently remove it from circulating supply.

This mechanism ensures that as protocol usage grows, token supply decreases — creating a direct, transparent link between Avantis's economic activity and $AVNT value accrual.

**Key properties:**

* **Systematic** — Executes daily, automatically, and proportionally to revenue.
* **Revenue-linked** — Buyback volume scales with trading activity.
* **Permanent** — All purchased tokens are sent to a burn address and removed from supply forever.
* **Verifiable** — Every purchase and burn is onchain and publicly auditable.

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### How It Works

#### Eligible Fees

30% of all trading fees is directed to buying back $AVNT, here's the breakdown:&#x20;

| Fee Type         | Included in Buybacks? | Details                           |
| ---------------- | --------------------- | --------------------------------- |
| Opening fees     | ✅ Yes                 | Charged when a position is opened |
| Closing fees     | ✅ Yes                 | Charged when a position is closed |
| Win fees         | ✅ Yes                 | Charged on profitable trades      |
| Margin fees      | ❌ No                  | 100% allocated to LPs             |
| Liquidation fees | ❌ No                  | Allocated to protocol treasury    |

#### Excluded Fee Rationale

**Margin fees** are excluded because they compensate liquidity providers for their cost of capital and serve as a hedge against trading volatility and unhedged trades. Directing 100% of margin fees to LPs ensures LP protection and sustainable liquidity depth.

**Liquidation fees** are excluded because they fund the protocol treasury, covering operational costs for the core team.

#### Daily Execution

Each day, the designated percentage of eligible fees is used to:

1. **Purchase** $AVNT on the open market.
2. **Burn** the purchased tokens by sending them to a null address, permanently removing them from supply.

Buyback volume adjusts proportionally — higher protocol revenue means more tokens bought and burned; lower revenue means fewer. There is no fixed dollar amount or manual intervention.

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### Current Fee Allocation

#### Milestone 1 — Live Now

**30% of daily opening, closing, and win fees** are allocated to buyback and burn.

| Fee Type                     | Allocation                 |
| ---------------------------- | -------------------------- |
| Opening / Closing / Win fees | 30% → Buyback & Burn       |
| Opening / Closing / Win fees | 70% → Liquidity Providers  |
| Margin fees                  | 100% → Liquidity Providers |
| Liquidation fees             | 100% → Protocol Treasury   |

The core principle: operate at break-even while directing the majority of revenue back to token buybacks and ecosystem growth (LP + trader incentives).

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### Milestone Roadmap

#### Milestone 1 — 30% Allocation ✅

* **Status:** Live
* **Allocation:** 30% of daily opening, closing, and win fees
* **Activation:** Immediate, no conditions

#### Milestone 2 — 50%+ Allocation 🔜

* **Status:** Planned (target: end of Q2)
* **Allocation:** 50%+ of daily trading fees
* **Activation condition:** Completion of protocol economic upgrades

Milestone 2 is **not** tied to an arbitrary revenue number. It activates once the following structural improvements are complete:

* **LP capital efficiency improvements** — Optimizing how liquidity is deployed.
* **Liquidity architecture upgrades** — Evaluating removal or restructuring of protocol-owned LP positions to increase the sustainable fee share captured by the protocol.
* **System risk management enhancements** — Ensuring higher buyback allocations do not compromise trading liquidity or system stability.

These upgrades enable a higher allocation to buybacks without reducing LP returns or degrading the trading experience.

> **Design principle:** Allocation scales alongside structural upgrades, not arbitrary thresholds.

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### Verification

All buyback and burn activity is fully transparent and on-chain. You can verify at any time using the following:

| Resource              | Link                                                                           |
| --------------------- | ------------------------------------------------------------------------------ |
| **Buyback Dashboard** | [foundation.avantisfi.com/buybacks](https://foundation.avantisfi.com/buybacks) |
| **Buyback Address**   | 0xa75886adA4dE4BA28F2385615216E48e7bEA1410                                     |
| **Burn Address**      | A null address where $AVNT is sent for permanent removal                       |

Daily purchases and burns are recorded on-chain and displayed on the official buyback dashboard.