# The PROOF Flywheel

The PROOF ecosystem is designed around a self-reinforcing economic loop we call The PROOF Flywheel. It aligns incentives between founders, the PROOF community, and the platform itself, creating compounding long-term value with every successful launch.

At the core of this flywheel is our new revenue model, which allocates a portion of all launch-generated fees toward buybacks of the $PROOF token. This structural change strengthens the token economy, enhances chart performance, and accelerates growth across the entire ecosystem.

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### Old Model vs New Model

Historically, our revenue split focused only on two areas:

* Company operations
* Revenue share with PROOF stakers

This model worked, but it didn’t actively support the $PROOF chart or reinforce long-term token demand.

Our new model introduces a third pillar:

#### 25% of all PROOF revenue is now allocated to buybacks of $PROOF.

This means:

* Continuous buy pressure on $PROOF
* A growing locked supply (through staking)
* Healthier, more stable chart performance
* Stronger incentives for both investors and new projects

This shift turns every successful launch into a direct driver of long-term value for $PROOF holders.

#### The Buyback Effect

Every time a project launches through PROOF, the platform earns fees. A portion of those fees is automatically set aside to buy $PROOF from the open market.\
This creates steady, ongoing buy pressure, which helps support the token price over time.

Here’s how the cycle works:

* Each new launch generates fees
* A portion of those fees are used to buy $PROOF
* Buybacks support price appreciation
* Higher token value attracts more attention
* More attention leads to stronger teams launching
* Stronger launches generate even more fees

This becomes a compound loop where each new project strengthens the $PROOF token - and the stronger the token becomes, the more attractive PROOF is to both founders and investors.<br>

<figure><img src="https://1400512712-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FmQWFo3ZE4F7pf0NieLPY%2Fuploads%2FtO1O5Cda0BhkDJbtAoxi%2FScreenshot%202025-11-18%20at%2010.00.20.png?alt=media&#x26;token=fd285776-ceb0-4000-822f-cd4fe12bec1c" alt=""><figcaption></figcaption></figure>

### How the PROOF Flywheel Works

The flywheel operates in eight repeating steps, each reinforcing the next:

**1. Launch**

A new project goes live through PROOF’s incubator.

**2. Fees Collected**

Volume and fees generated during the launch contribute to PROOF’s total revenue.

**3. Locked Supply**

People stake their $PROOF to receive their portion of the revenue share, increasing locked supply and reducing sell pressure.

**4. Revenue Share Distributed**

PROOF stakers earn a portion of all launch volume, enhancing long-term holding incentives.

**5. Buybacks**

A dedicated share of all revenue is used to buyback $PROOF from the open market.

**6. Higher $PROOF Price**

Consistent buy pressure and reduced circulation help strengthen chart performance over the long-term.

**7. Increased Attention**

A healthier chart draws more investors, KOLs, and communities into the ecosystem.

**8. Attracting New Teams**

Founders see the performance and support PROOF provides, leading to more applications, better projects, and an expanding pipeline.

And then the cycle repeats - every new launch accelerates the entire ecosystem.<br>

<figure><img src="https://1400512712-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FmQWFo3ZE4F7pf0NieLPY%2Fuploads%2F310fUHgwIKDVOkNUDu9U%2FScreenshot%202025-11-18%20at%2010.02.45.png?alt=media&#x26;token=8b45627d-f871-46f4-9e55-d92fa91da8a1" alt=""><figcaption></figcaption></figure>

#### Why This Matters

The PROOF Flywheel transforms the launch process from a one-time event into a perpetual value engine:

* Founders win by accessing a launch partner that brings attention, liquidity, and long-term support.
* Investors win through revenue share and strengthened token economics.
* PROOF wins by attracting higher-quality projects, increasing volume, and scaling sustainably.

And because buybacks are built into the model itself, the flywheel becomes self-propelling, compounding the benefits with each successful launch.

Watch PROOF founder JP break down in full our recent changes to tokenomics and fee structures here:

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