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On October 21st (Singapore Time), JustLend DAO, a leading decentralized finance (DeFi) protocol operating within the TRON ecosystem, celebrated a significant achievement: the successful execution of its inaugural, large-scale JST token burn. This event signifies a shift for JST, transforming it from a token with a fixed circulating supply into an asset with a continuously decreasing supply.
As previously communicated, JustLend DAO allocated more than 59 million USDT from its accumulated protocol earnings. From this total, 30% was utilized to repurchase and permanently remove 560 million JST tokens from circulation. The remaining 70%, equivalent to over 41 million USDT, is scheduled to be burned gradually across the next four quarters.
JST Supply Reduction Progresses: Initial Burn Eliminates 5.66% of Tokens; Over $41M Still Earmarked for Future Burns
Unlike temporary buyback programs often fueled by subsidies, JST’s deflationary mechanism is driven by consistent and reliable income generated by JustLend DAO and USDD, two essential components of the TRON ecosystem. By directly linking JST’s value to the protocol’s profitability – based on current earnings and continuously boosted by new revenues – the model establishes a transparent and self-sustaining cycle, contrasting sharply with conventional one-time buyback initiatives.
Funding for these buybacks originates from two main sources: first, JustLend DAO’s net operational profit, encompassing both current reserve funds and future income; and second, USDD’s increasing revenue, which kicks in once its cross-chain activities exceed a profit threshold of $10 million.
According to the official announcement, JustLend DAO allocated in excess of 59 million USDT from its accumulated revenue, implementing a structured approach: 30% for the initial phase and the remaining 70% to be burned progressively on a quarterly basis. The first phase is now concluded – approximately 17.72 million USDT (30% of the total reserve) was used to eliminate roughly 560 million JST, representing approximately 5.66% of the total token supply. The remaining 70%, amounting to more than 41 million USDT, will be burned over four quarters. In the meantime, these funds are maintained as jUSDT within JustLend DAO’s SBM USDT market to generate additional returns, with these earnings also dedicated to upcoming buybacks and token destructions.
Leveraging incremental earnings, JustLend DAO will direct each quarter’s new net income into the buyback pool, with USDD’s profits – once the specified profit target is achieved – also contributing to the cycle. Future buybacks and token burns will be managed by JustLend Grants DAO under a transparent framework: for the first four quarters, each new quarter will start with the destruction of the previous quarter’s incremental net income, plus 17.5% of the current reserve funds.
This initial 5.66% token burn is just the beginning. As reserve funds are systematically released and continuous income flows in, the total quantity of JST removed from circulation is projected to surpass 20%.
Decreasing Supply and Ecosystem Yield Enhance JST Value
With the launch of the initial buyback and burn, JST’s significant supply reduction cycle is officially underway. JST’s diminishing supply is now intertwined with the interconnected dynamics of JustLend DAO and USDD, positioning JST for a renewed increase in value.
JST reached full circulation in the second quarter of 2023, featuring a capped total supply of 9.9 billion tokens and no upcoming unlocking events. Every buyback and burn action leads to a tangible reduction in circulating supply, thus increasing scarcity and offering stronger price stabilization for the token. It’s noteworthy that JST’s burn program is significant in scale: with a market capitalization near $300 million, JustLend DAO’s $60 million in stored revenue alone accounts for roughly 20% of JST’s total market valuation.
The sustained long-term value appreciation of JST comes not only from its supply reduction mechanism but also from the steadfast support of the entire JUST ecosystem’s value loop. JustLend DAO and USDD, serving as the foundational pillars, both contribute resources for the deflation model and translate diminishing supply into sustained value gains.
Serving as the DeFi cornerstone within the TRON ecosystem, JUST has developed a comprehensive service infrastructure integrating SBM, sTRX, and Energy Rental for JustLend DAO, while extending its DeFi product range with stablecoins like USDD. The JUST ecosystem currently holds up to $12.2 billion in Total Value Locked (TVL), representing 46% of TRON’s total – a testament to the market’s robust confidence in its capability to generate sustainable, large-scale returns.
JustLend DAO has grown from a basic lending protocol to a comprehensive DeFi platform covering lending and borrowing, liquidity staking, and Energy rental services. Its diverse income streams give it a competitive edge in both stability and growth prospects. As of October 21st, JustLend DAO reported $7.62 billion in TVL and a user community of 477,000, ranking fourth globally in the lending sector by TVL, showing a strong presence in the DeFi space.
In terms of profitability, beyond the existing $59 million in revenue, the platform generated nearly $2 million in fees in the third quarter of this year, according to data from DeFiLama. This additional income is sufficient to cover the $6 million quarterly buyback, providing a reliable financial foundation for JST’s long-term supply reduction strategy.
Meanwhile, USDD operates as the second driving force behind the deflationary process. Any revenue that surpasses the $10 million threshold will be allocated to JST buybacks. Having been deployed across major blockchains, including Ethereum and BNB Chain, USDD boasts a circulating supply of over $450 million and is positioned to become a key liquidity source for JST deflation.
This buyback and burn is not a one-off event, but rather the beginning of a long-term approach to decreasing supply driven by the real earnings of the ecosystem. From JustLend DAO’s $60 million in prior revenue to the consistent flow of multi-chain profits from USDD, and the wide-ranging support from the JUST ecosystem, JST is establishing a beneficial cycle – where ecosystem-driven supply reduction increases token scarcity, enhances value, and further boosts ecosystem growth.
About JustLend DAO
JustLend DAO is TRON’s decentralized financial platform where users can earn yields through supplied assets, borrow digital assets against collateral, participate in TRX staking, and rent Energy. Committed to developing TRON-based DeFi protocols and providing all-in-one financial solutions to its users, there is now more than $7.6B Total Value Locked in the JUST Network.
The JustLend DAO provides a forum for its users to participate in governance and directives, while empowering its users with decentralized authority, trustless transactions, smart-contract automation, and security with transparent accountability.
Engage with the JustLend DAO community via the JustLend DAO Portal, Telegram, Twitter, and the JUST Network.
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