Buyback-and-burn mechanism

$ARTE will be burned in all utilities described in the following sections, however, its main element will be the unique buyback & burn mechanism based on the ArtPunks royalties. We will use the 5% royalties of the ArtPunks collection to burn $ARTE every day. Thanks to this, we will reduce the circulating supply of $ARTE and increase its value. The ArtPunks collection already has over 12,000 $SOL (~$1,200,000) volume, using 5% of this to burn $ARTE will support long-term price stability and value growth.
$ARTE buyback self-reinforcing feedback

What is the buyback-and-burn mechanism about?

“Buyback-and-burn” may be a terminology specific to digital assets, but the idea is the same as with traditional share repurchase programs: The issuer buys back previously issued tokens on the secondary market, to reduce supply (by burning them) and thus increase market prices.
Which other projects use the buyback and burn mechanism?
The best example might be Binance company with ‘Binance Coin’. Binance’s buyback-and-burn program has proven effective. The BNB token of the exchange Binance includes a buyback-and-burn program. As outlined in the company’s whitepaper, Binance uses 20% of its profits to buyback-and-burn BNB tokens every quarter, reducing the overall circulating BNB token supply. This process is going to continue until Binance has burned 50% of all BNB tokens.

Why it is good for ArtPunks holders?

ArtPunks ecosystem will benefit from buyback-and-burn in four ways:
  • Buyback-and-burn programs support the growth and price stability of the token value once listed for secondary trading.
  • The token will be more attractive to investors.
  • Buyback-and-burn results in increased liquidity as the secondary market demand for trading the asset on exchanges will be higher. Increased liquidity in turn results in lower price volatility.
  • Buyback-and-burn incentivizes long-term growth investors to HODL the token, which further adds to the price stability of the asset.

Why it is good for $ARTE holders?

Buyback-and-burn programs support long-term price stability and value growth. The goal of buyback and burn is to increase the value of a token by lowering its supply as income increases. Buybacks tend to achieve this purpose, although burning has distinct effects on currency and capital assets. Furthermore, long-term growth is encouraged through buybacks. Investors are encouraged to HODL the token, which helps to maintain the asset's price stability.