Core DAO Abandons Token Burn for Buybacks as Supply Management Tool

Core DAO's token burn mechanism is currently active but transitioning away from permanent token destruction. Instead of burning block rewards and transaction fees, they will be repurposed to support network operations like validator incentives and fund ecosystem projects. The hard cap on supply remains in place at 2.1 billion tokens, with the circulating supply asymptotically approaching this figure but never fully reaching it.

The burn mechanism is similar to Ethereum's fee-burning approach, where a percentage of all block rewards and transaction fees are burned each round. However, unlike Ethereum, Core DAO's burn rate is determined by the DAO rather than fixed in code, giving governance participants direct influence over how aggressively supply is reduced.

Core DAO's tokenomics are layered, with a hard cap, smoothly declining emission schedule, and deflationary mechanisms like block rewards decreasing by 3.61% each year. The network will eventually shift towards buybacks as the primary supply-management tool, driven by revenue from its Bitcoin DeFi ecosystem.