Klaytn Foundation Buyback Announcement

TL;DR

To stabilize Klaytn’s ecosystem, a buyback is in progress:

  • Klaytn Foundation’s stablecoin reserves will be used
  • Only through spot purchases from the market (CEX)
  • All KLAY purchased will be burnt

As discussed during our May AMA’s, the Klaytn team has been pursuing various strategies to achieve our goal of a more sustainable ecosystem.

Last Friday (October 21), the Klaytn team detected abnormal fluctuations in on-chain liquidity, and the decision was made to execute a market buyback of KLAY from the markets in order to stabilize Klaytn’s ecosystem.

The buyback is currently in progress and is being conducted as follows:

  • Funds used for the buyback come from stablecoin reserves held by the Klaytn Foundation, secured previously from strategic partners.
  • The buyback is strictly limited to spot purchases directly from the market (CEX) and is being strategically executed to minimize market volatility.
  • All KLAY purchased via the buyback will be burnt.

The decision to execute a buyback was made in order to manage risks derived from the actions of certain entities. The Klaytn team believes this was the right decision to make in our pursuit of a robust ecosystem.

To prevent front-running or market manipulation, this decision was not announced in advance.

Additional factors that were taken into consideration during the decision-making process included the current macro and micro landscapes, and most importantly, community feedback and concerns; this is also in line with our recent Governance Proposal recommending a reduction in block rewards.

Updates regarding the buyback will be shared at a later date.

As always, the Klaytn team will continue focusing its resources on improving and evolving Klaytn’s ecosystem in all aspects, to maintain competitiveness in an ever-changing landscape.


[3Q Klaytn Ecosystem Update]
The 3Q Klaytn ecosystem updates will cover key initiatives the Klaytn team is currently undertaking in our continued efforts to achieve an optimal and sustainable Klaytn ecosystem.

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© Klaytn Foundation 2022. All rights reserved.
© Klaytn Foundation 2022. All rights reserved.