Overview
This proposal seeks DAO approval to redirect the portion of protocol revenue currently allocated to TREE buybacks under TIP 4 toward ecosystem growth, development, and strategic initiatives that strengthen Treehouse’s long-term position.
If approved, the protocol fees generated from tETH Market Efficiency Yield (MEY) currently used for open-market TREE buybacks will instead be retained by the protocol for broader ecosystem deployment. Buybacks funded under TIP 4 will be paused as a result of this reallocation, effective from the date this proposal passes on Snapshot.
Buyback holdings already accumulated will remain intact in the existing buyback wallet as long-term DAO reserves. No previously acquired TREE will be sold, transferred, or deployed under this proposal.
Background
In TIP 4, the DAO established a recurring TREE buyback program funded by protocol fees generated from tETH MEY.
The program was designed to align protocol growth with long-term tokenholder value through open-market TREE purchases, with acquired tokens held as DAO reserves and tracked transparently onchain.
Since implementation, buybacks have been executed periodically on Ethereum, with a minimum cadence of once per week. To date, the buyback wallet holds 1,435,886 TREE accumulated through the program. Historical execution data is publicly available via the Dune dashboard.
Motivation
Since TIP 4 passed, broader market conditions and the protocol’s strategic priorities have continued to evolve. The DAO sees an opportunity to direct protocol revenue toward initiatives that may compound long-term value more efficiently than continuous open-market buybacks under current conditions.
Redirecting this share of revenue allows the DAO to:
- Preserve capital flexibility to deploy revenue where it generates the most ecosystem leverage during the current market phase.
- Reinforce protocol-level growth by channeling fees back into liquidity depth, integration support, as well as tAsset and Decentralized Offered Rates (DOR) adoption programs.
- Maintain optionality to reactivate buybacks under more favorable conditions, subject to a future governance proposal.
The DAO retains full authority to reinstate or revise the buyback program through future governance proposals as market conditions and protocol priorities evolve.
Specification
If approved, this proposal will:
- Redirect the portion of protocol fees generated from tETH MEY previously allocated to buybacks toward ecosystem growth, development, and other protocol initiatives.
- Pause all open-market TREE purchases funded by protocol revenue generated from tETH MEY.
- Retain all TREE currently held in the buyback wallet as DAO reserves. No tokens will be sold, transferred, or otherwise deployed under this proposal.
Any future modifications to revenue allocation or buyback parameters will remain subject to DAO governance.
Implementation Plan
If approved, the DAO assigns Treehouse Protocol to:
- Redirect the specified share of protocol revenue toward ecosystem and protocol initiatives.
- Halt all open-market TREE purchases funded by protocol revenue.
- Maintain the existing buyback wallet as a transparent onchain DAO reserve.
Next Steps
- Gather community feedback on the proposal.
- Submit the finalized proposal for a formal DAO vote on Snapshot.
- Upon approval, pause buybacks funded under TIP 4 and redirect protocol revenue to ecosystem growth and future strategic initiatives.