Buy and Burn

Any residual fees that are not distributed via Tip Streams flow to the Buy and Burn module. The Buy and Burn module handles the auctioning of residual Protocol Fees held by the treasury and burns the governance tokens it receives from bidders.

The mechanism used for the Buy and Burn process is the same Dutch Auction approach used by the RAFT contract. The key difference being that Protocol governance tokens must be used to bid. Received governance tokens are burned as part of the transaction. This mechanism is designed to create demand side market pressure for the Protocol governance token.