@yvettepowell

Buyback and burn mechanisms shrink token supply and act as indirect cash returns. In valuation models, this should be integrated as an effective reduction in circulating supply growth, lowering long-term inflation assumptions. Modeling involves projecting burn pace relative to transaction volume or fee revenue, then embedding that into a supply-adjusted DCF. Projects with transparent, consistent buybacks merit higher valuation multiples, as they mimic shareholder-friendly behavior. However, overly discretionary mechanisms require credibility adjustments. Investors should assess treasury sustainability to ensure buybacks aren’t funded unsustainably. Done right, buybacks reduce dilution and lift per-token intrinsic value.

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