Monetization of Pyth Data Through Onchain + Offchain Expansion

Ideas Bank
1

Summary

Douro Labs proposes expanding the Pyth offering into the institutional market through a paid subscription product. Institutions spend ~$50B annually on market data, growing 10% per annum. By leveraging Pyth’s unique value position—proprietary market data, broad cross-asset coverage, and proven DeFi adoption—the Pyth DAO can capture part of this market.

This expansion represents a new, high-margin revenue source for the DAO, while everything onchain for existing DeFi users continues as before.

Background

Institutional market data: Banks, asset managers, and trading firms rely on data for risk models, settlement, compliance, displays, and analytics. Today they pay billions to legacy providers like Bloomberg and Refinitiv, who bundle fragmented feeds and capture all downstream revenue.

Why Pyth is positioned to enter:

  • Already integrated with 600+ protocols across 100+ blockchains (onchain + offchain).

  • Delivers 1,800+ price feeds, including 900+ real-world assets.

  • Handles ~$1.6T in trading volume through applications using Pyth feeds.

  • Processes ~75–100M price updates onchain each month.

Pyth is already the trusted source of high-quality data in crypto; the next step is offering that same standard to institutions.

Proposal

Institutional Subscriptions: Launch a paid subscription service that delivers low-latency, high-frequency data to professional clients. Onchain protocols can also subscribe if they need this tier.

Access to Subscriptions: Supported in USD (credit card/wire), stablecoins, or PYTH tokens.

Distribution Network: Since it would be operationally inefficient for the DAO to run billing or infrastructure directly, it should build a network of distributors (e.g. Douro Labs). This company would:

  • Operate a subscription API infrastructure

  • Manage contracts with clients directly

  • Report revenue and performance to the DAO

Revenues: 60% of subscription revenues to flow to the DAO. The remaining 40% is expected to be split across the data distributor network and administrative fees.

Onchain users of Core (the validation service) will continue as before. Fees for Core usage are already being rolled out per prior DAO discussions, and this proposal does not change that trajectory. Onchain protocols, will of course, have the ability to subscribe to the paid service (Lazer) if they need this tier.

Implementation

  • DAO authorizes a distributor to administer and oversee the institutional subscription platform.

  • DAO approves terms with distributors.

  • DAO monitors all monetary transactions. Net proceeds accrue to the DAO treasury, after covering service costs.

Next Steps

  1. Community discussion on expanding into the institutional market and the role of service providers.

  2. Agree fee structure, service agreement terms, and approval process.

  3. Define how DAO proceeds will be allocated (publisher rewards, oracle integrity staking rewards, buy-backs, etc…)

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4. Prepare a detailed follow-up proposal for DAO vote.

14 Likes
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Very much anticipated proposal, definitely voting - YES!
Subscription model will not only bring the additional fees, but will structure a unified business product for all the institutions/individuals/firms they can use

6 Likes
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The Pyth Network’s expansion into onchain and offchain monetization is a forward-thinking move. I approve :white_check_mark:

4 Likes
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Step 1 seems simple enough to discuss.

Step 2 seems a little bit more complicated. Base-level research shows that existing services (like a singular Bloomberg Terminal cost about $2000/month). Obviously any future Pyth product should be highly competitive and attractive when compared with existing legacy items. Would a future Pyth Product be a bespoke/enterprise solution? I would think this would become far more complex in terms of costing. Understanding what the actual cost is per connection (including expanding infrastructure required for the expansion of more price feeds) may help to better inform what a profit margin may look like. The proposal is amazing, and I am very excited. But getting into the details, we still need to do a lot of research to determine what is profitable, and competitive. Is there any information that can be provided in relation to this?

Step 3 again seems less complicated haha

Thank you for this post, and the future is bright for all current Pythians: and those to join us in the future

5 Likes
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Why are we limiting subscriptions to Institutions and not providing it to other users. Likes old traders?

Day Traders were forced to utilize terminals from BDs which took a bite of their earnings. Since we are about liberating data onchain. Lets get it directly into the peoples hands and let them fatten their bags

3 Likes
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Very excited to see the wheels in motion for Pyth Network to move into phase 2 of its roadmap. It’s a big yes to go ahead with this from me with similar to views on the 3 steps as @Derrp has outlined above.

I look forward to discussing each of these steps in more detail as we progress with this.

1 Like
7

I don’t believe it has been mentioned these subscriptions will be limited to any one entity, I think the terminology used speaks of the target and what will most likely be the majority of customers.

I think day traders could fall under the category of trading firms (just on a smaller scale) as quoted above

4 Likes
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I agree with @amensch that Pyth should consider all verticals, and we should not limit ourselves to certain market segments. The proposal seems focused on clients like banks, asset managers, and trading firms (though I understand those may just be examples). If not already considered, another segment worth exploring is trading brokerages.

Brokerages currently rely on multiple data sources for prices, including SIP feeds, direct exchange feeds, and third-party vendors. While some of these may be required by regulations, Pyth’s new product may be attractive as a supplemental source, especially since brokerages are eager to expand into crypto and other asset classes.

Positioning Pyth as a strategic data partner for fast-growing brokerages could strengthen brand reputation and credibility. Arguably, this could be a bigger benefit than the revenue these partnerships might bring. While not the largest by AUA/AUM, these brokerages are good candidates for potential partners due to their rapid growth and consumer-friendly branding (in these respective regions): US: Robinhood, EU: eToro, Asia: Moomoo.

This idea was partly inspired by @PilotSB, who had suggested the idea of partnership with Moomoo (on Discord).

7 Likes
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This sounds wonderful. Its a pretty solid idea to tap in to the institutional market, with a subscription based service. I just want to understand the Distribution Network a bit better. So what are looking for in a distributor and who can contribute.

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I’m buying this prop. because it creates a sustainable, high-margin revenue stream for the DAO while leaving existing onchain users unaffected. Expanding into the $50B institutional data market allows Pyth to monetize its unique cross-asset coverage and proven DeFi adoption. From my end, I strongly recommend prioritizing PYTH tokens as a preferred payment method for subscriptions. This not only drives direct utility for the token but also reinforces long-term alignment between institutional adoption, token demand, and DAO growth.

6 Likes
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agree with the prioritization of Pyth tokens as a preferred payment, it allows the token to capture more value, it is a fundamental problem for most tokens the inability to capture value, pyth definitely has the utility onchain but this is a great opportunity to maximize it exponentially.

4 Likes
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definitely yes, a day trader using TradingView or MT4/5 should be empowered with the same Pyth data too.

4 Likes
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@Imgonnatakeapyth you are hinting to $PYTH as the universal data token, whereby both the data consumed and the data produced are priced in the same utility token. imo, the concept would consistent with the design of the network whereby subscribers to high-quality verifiable data pay for the services of the network and the data inputs that make up the aggregate consumed

6 Likes
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First of all, thank you for the proposal!

I agree on the launch of Pyth Data subscriptions! I have seen the “Phase 2” blog of Pyth and i think market data is waiting for a disruptor. I also think this a a good way to expose / inform institutions about Pyth, maybe onboard them first as customers to subscriptions and as publishers on the future as well

I also agree on the percentage of revenue split. 60% DAO and 40% to data distributor and admin fees

Questions and Comments:

  • for the Distribution network, Douro Labs was mentioned as and example, and i think they are also one of the best candidates, but do we have any other “distribution network” candidate? Will it be limited to one company or a group?

  • Was confused on who are we referring to as “service providers”, is it the same as the “distibution network”?

  • for the DAO proceeds allocation, i don’t have a "percentage allocation” on mind at the moment, but i think in my opinion this can be the ranking in terms of priority

    • OIS rewards - current rewards are from PDA (100M $Pyth) and we are currently at 50M in almost a year, with Staked Pyth increasing, it will be depleted in a few months
    • Publisher Rewards - Pyth already accounted 22% of the total Pyth supply as Publisher rewards, but since they are “responsible” for all the feeds that Pyth delivers i think a good % of the revenue should also be allocated to this. Not to mention it is one of problems Pyth wanted to solve, Revenue of Market Data to the source of this market data.

  • Related to the above, since revenue will be in USD, stablecoins and Pyth tokens, curious if the proposal will / should include how this will be allocated. Is it “as is”, or be swapped to other tokens (e.g. $PYTH) before allocation?

  • Will the payment for subscriptions via blockchain? I hope it is, not sure how it works on the USD payment but i think a lot are already doing it? I hope it is via blockchain so it is transparet and besides the revenue and performace report, anyone can validate it via the blockchain.

4 Likes
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Dear Douro Labs,

Nice proposal, and thank you for putting this forward. I have a few questions for clarification:

  1. Is the 60% / 40% revenue split optimal, or could this represent too much overhead? How transparent will distributor costs and profits be to the DAO?

  2. How strict will the Service Level Agreements (SLAs) be? For institutional services, clients typically require clear guarantees around latency, uptime, data quality, and even penalties if the provider fails to meet agreed standards.

Finally, while there are multiple potential uses for DAO revenue—such as publisher rewards, staking incentives, or ecosystem grants—I believe prioritizing buybacks is the most effective way to align value creation with community growth.

In web3, unlike in web2, sustainable buying pressure on the native token is not a short-sighted tactic but rather a core mechanism to reinforce the network’s economic health. By channeling a meaningful portion of subscription revenues into buybacks, the DAO ensures that value generated from institutional adoption flows directly back to token holders, strengthens long-term demand for PYTH, and fosters a healthier, more resilient ecosystem. Hyperliquid is a strong example of how this approach can successfully align incentives and support long-term growth.

1 Like
16

@bats4 I will try to answer the points you raised:

* I personally think the DAO is better served when multiple distributors are competing to grow and increase the value generated to the DAO

* service provider is meant to mean the same as the distributor assigned by the DAO to grow the subscription business

* any member, including yourself, should feel empowered to propose a treasury composition (Pyth vs. stable)

* Given a number of institutions might currently struggle with on-chain payments, I am of the opinion that we should aim to support both, with the right levels of transparency and accountability over any revenue realized off-chain

1 Like
17

I have some thoughts regarding the proposed distributor network.

Conceptually, it makes sense, as it enables the Pyth DAO to utilize distributors’ diverse networks and geographic reach for faster market penetration, provided we identify suitable distributors.

To ensure consistency and prevent undercutting that could erode revenue, there should be a baseline pricing structure, while still allowing them the flexibility to tailor offerings to various client types.

I suggest the DAO considers various alternatives to the somewhat arbitrary 60-40 revenue split. For example, what if it was a variable revenue-sharing model tied to the amount of $PYTH a distributor stakes in governance. For example, a distributor not staking any $PYTH would receive a baseline revenue share of, say, 20% (or whatever reasonable percentage sufficient to cover cost of sales and provide a modest margin). In contrast, a distributor who stakes $PYTH could earn a larger percentage, potentially up to 40% or more, based on a tiered system.

Such an approach would align distributors’ interests with Pyth’s success as $PYTH token holders. It would motivate distributor performance, encourage participation in governance, and promote decentralization by incentivizing broader distribution of influence among stakeholders. Currently, the concentration of $PYTH stakers is still heavily skewed toward top holders, and this model could help address that imbalance.

Taking this concept further, we could also extend incentives to TradFi clients by offering rebates on their data subscriptions based on the amount of $PYTH they stake (similar to another idea I shared previously). While it may be challenging for some TradFi clients to own and stake $PYTH, it shouldn’t stop us from exploring such incentives, which would be appreciated by the more web3-savvy clients. Obstacles to token ownership should only diminish over time, based on current trends. TradFi clients will also represent a key stakeholder group whose participation in governance would bring value to the DAO and further enhance decentralization.

If designed effectively, such mechanisms would increase the utility and demand for the $PYTH token, boosting value for token holders. More importantly, they would help the Pyth DAO achieve a more meaningful degree of decentralization - a DAO not just in name, but in practice.

2 Likes
18

Thank you for laying out this proposal.

One question offered by this young interloper is how “professional clients” would prefer to consume Pyth data.

Some analogies that come to mind are hardware or terminal UIs by players like Bloomberg. Or are we envisioning a Web2 style of selling access? (See the suggestion of “Support in USD (credit card/wire), stablecoins”)

An exciting vision for Pyth. I approve of a future where Pyth continues distributing data onchain for DeFi, and in addition, to the rest of the (institutional) world

4 Likes
19

I would actually prefer stables for payments

At the end of the day we’re talking about revenues that should keep the DAO running smoothly, and with stables you know exactly what comes in every month.

The treasury can then decide how and when to convert part of it into PYTH (if the buyback model will be voted), even DCA it, while still keeping enough stable reserves for ops, grants, and activities.

This way the DAO has predictable income, but PYTH still benefits from controlled buybacks(again if voted for) and steady demand.

6 Likes
20

It’s a great idea. Do we expect this to be a competitor to feeds like Bloomberg, or is this supplementary?

I assume something like Bloomberg has a very large amount of assets as part of the feed. Do we know the how we compare to the competitors ? Or are we aiming for feeds that aren’t commonly covered by the competitors?