ASTER token rallies after a massive fee restructuring model guarantees a matching burn from reserves

The Aster team announced a new model for its tokenomics on June 17, essentially routing 99% of the protocol’s daily fees into automatic ASTER token buybacks. The protocol has also tied every purchase to a matching burn from the reserves. Aster calls this a 198% buyback-and-burn ratio, and the announcement led to a 17% rally of the ASTER token within hours.

Since Aster token’s TGE, the team has conducted six buybacks, cumulatively repurchasing over 266 million tokens worth approximately $187 million.

The YZI Labs-backed project is finally transitioning from the unpredictable buybacks to a continuous rule-based system. ASTER investors view this as a positive signal for the native token, leading to a sudden spike in its price.

How Aster plans to use 99% of its platform fees

Under the new model, Aster will use 99% of its platform fees to automatically repurchase ASTER tokens through daily TWAP execution. The new model leaves no discretionary reserves left for the team to manage manually.

Under the new tokenomics, every repurchased ASTER token will be distributed to veASTER stakers as part of royalty rewards. Additionally, a 300,000 $ASTER base reward is paid out each epoch. At the same time, an equal amount of $ASTER is destroyed from the protocol’s reserves, with the team’s own allocation first in line to be burned. Burns run on a two-week cycle and are meant to continue until the total supply falls to 3 billion tokens.

According to the plan, Aster will eventually burn approximately 5 billion tokens, given that the current total supply is approximately 7.82 billion out of a hard cap of 8 billion. In this model, Aster is betting on its ability to attract higher trading volume on its DEX platform. The time it takes for the platform to burn over 5 billion tokens depends heavily on the DEX’s future activity.

Aster also made some alterations to the Spot side to improve its tokenomics. The newly adopted model now allows every permissionless token listed on Aster spot to carry a 50,000 USDT fee that also flows back into buybacks. They are then collected weekly and converted into staking rewards about two weeks later.

How ASTER token buybacks impact the buying side

Ironically, last October, Aster announced it would burn half of its buyback tokens, and the price fell by 2.8%. A few weeks later, Cryptopolitan reported that Aster had completed its Stage 3 program by destroying 77.86 million tokens worth nearly $80 million, sent to the canonical dead address, and the token still slid 2.7% in the following 24 hours.

During the same period, Chainlink’s buyback program coincided with a 35% rally, a contrast that undercuts the idea that burns alone move price.

By February, Aster CEO Leonard was addressing that frustration directly, telling holders on X that emissions and buybacks were following the published roadmap even as price action lagged, while confirming plans to pause the monthly token unlock once staking went fully live.