Great proposal Marc, I’d like to extend it with a burn mechanism for excess PYTH above the target ratio. I know burns weren’t part of your original framework, but I think the time has now come to start giving this genuine consideration
The extension: rather than letting PYTH accumulate indefinitely above the target, excess PYTH above a defined band gets burned. This proposal allows for permanent supply reduction and an emission-free show of commitment to Pyth the token, while the band structure and USDC floor preserve DAO flexibility for funding requirements..
Proposed structure: target 50/50, with a 50–65% PYTH band. Once the ratio hits 65%, burn the excess back to 50%. The band is deliberately wide. This produces fewer, larger burns rather than continuous micro-rebalancing. Benefits: Meaningfully lower governance overhead if each burn requires an OP-PIP vote, it is also more marketable to post about larger burns rather than constant micro burns.
One important guard: burns should only execute if USDC holdings remain above 12 months of operational runway, as calculated by the Pythian Council in the monthly treasury reports already proposed in your framework. Realistically the treasury will sit comfortably above this given current revenue, but it ensures burns can never deplete operational capacity in tail scenarios. Supply reduction shouldn’t come at the cost of runway.
On reviews: I’d suggest a 6-month review built into the framework. The case for flexibility is strongest with burns specifically. Burned tokens can’t be unburned, so if a better mechanism emerges or market context shifts, we want to be able to adjust without past decisions locking us in.