The following is a guest post and analysis from Maarten Henskens, Head of Astar Foundation.
Web3 has a problem with value capture. Despite billions in market capitalization, most projects continue to extract value from their communities rather than return it. While venture capitalists and founding teams reap substantial rewards through token sales and vesting schedules, early adopters and community members who drive actual adoption often see diminishing returns over time.
This needs to change—and community-governed treasury management is the most effective way to make it happen.
The Value Return Imperative
For too long, crypto has operated under a fundamentally extractive model. Projects continually dilute token value by increasing supply through grants, incentives, and foundations, leaving their communities to absorb this inflation. Meanwhile, the revenue generated by these ecosystems—whether through gas fees, sequencer revenue, or application fees—rarely flows back to the token holders who enabled the project’s success in the first place.
Without mechanisms to return value to community members, projects face increasing difficulty maintaining engagement, loyalty, and growth over time. The industry is beginning to recognize this challenge, with various protocols exploring new approaches to treasury management that prioritize community benefit.
Community-First Treasury Management
Projects have an ethical obligation to return value to their communities once they achieve scale and sustainability. Those who provided early liquidity, built the initial applications, and took risks during uncertain phases deserve to participate in the project’s success beyond mere token appreciation.
Strategic buybacks provide a transparent and efficient mechanism to fulfill this obligation. When Offchain Labs announced its strategic purchase plan for ARB tokens, critics assumed it was a price-support mechanism. In fact, by gradually acquiring tokens according to predetermined parameters, Offchain Labs is creating a positive and necessary relationship between network usage and community value.
Movement Labs demonstrated similar thinking when they established their strategic reserve after recovering $38 million from a rogue market maker. Rather than directing these funds toward team compensation or traditional treasury management, they committed to a transparent, three-month buyback program with publicly viewable wallet addresses.
Every blockchain community should be considering similar approaches.
Astar is now taking a clear step toward that future with the Astar Finance Committee (AFC)—a new initiative designed to manage treasury resources in full alignment with the community’s long-term interests.
The AFC’s mandate is simple but powerful: manage the DAO allocation transparently, explore reinvestment strategies that benefit the ecosystem, and create governance mechanisms that ensure accountability and collective input at every step.
From Theory to Practice
Community-governed finance relies on a dedicated governance body whose founding purpose is to transform untapped resources into sustainable value for the governed ecosystem.
Rather than leaving treasury management to a small team or allowing valuable resources to sit idle, ecosystems must create a structured committee with representatives from across the ecosystem, generally including a core foundation, a representative council, and the broader collective.
This puts strategic financial decisions in the hands of those with the expertise to execute them while maintaining transparency and accountability to the entire community. Treasury operations gain transparency, and governance is empowered to explore multiple avenues to generate sustainable revenue streams that can be reinvested in the ecosystem.
What makes this model particularly powerful is its flexibility and community oversight. The committee regularly evaluates potential strategies—from providing liquidity on lending protocols and DEXs to staking assets and investing in early-stage projects. All activities must be conducted with regular reporting and public access to multisig transactions.
Beyond Grants: Self-Sustaining Ecosystems
The grant-dependent model that has dominated crypto for years should be seen as training wheels that must eventually come off. While effective for bootstrapping activity, distributing tokens to incentivize adoption only delays the inevitable reckoning with value capture.
Community-governed treasury management represents the next evolutionary stage in tokenomics. By implementing transparent mechanisms for value return—whether through burns, buybacks (conducted in compliance with relevant regulations), or ecosystem investments—projects can create self-reinforcing systems that benefit all participants.
This creates something only Web3 can offer: collaborative economics. Properly designed treasury operations ensure that success is genuinely collective.
Transparency as a Requirement
For buybacks to achieve their purpose of community enrichment rather than market manipulation, transparency is non-negotiable. Projects must clearly communicate the exact source of funds for treasury operations; specific parameters dictating timing and execution; governance mechanisms providing community oversight; and the long-term strategy behind the initiative.
Regular reporting (monthly minor reports and quarterly major reports), public multisig wallets, and transparent execution of all operations ensure that the community can verify and validate every action.
When users can verify that sequencer revenue or protocol fees are being reinvested into buybacks through transparent on-chain transactions, it reinforces trust in the ecosystem. This distinguishes legitimate value-return programs from short-term price manipulation attempts.
A Call for Industry Evolution
Every blockchain project that generates meaningful revenue and is serious about long term sustainability and community alignment should implement some form of community-governed treasury management.
The pioneers implementing these programs today are establishing what will soon become industry standard practice. By creating transparent, community-governed mechanisms for value return, they’re creating a logical and inspectable link between network adoption and community interest that benefits those who make the ecosystem possible.
While these approaches won’t solve every problem in Web3, they address something the space has sorely lacked: a systematic connection between ecosystem success and community benefit. It’s time to give back to the communities that made these networks possible—not just with appreciation, but with real, measurable returns governed by the communities themselves.
