The AMM Approach
Buybacks are mostly performed as takers on an AMM, swapping one token for another.
When acting as a taker, the trader, or the token project in this case, accepts the available liquidity, the pool depth, the fees, the price impact, and the risks of buying into an active, transparent onchain market.
Slippage. Unnecessary swap fees. Fragmented liquidity. Sandwich attack risk. Missed opportunities.
And then there is coordination. If a project chooses to buy when the market reaches a specific price point, a new hurdle is introduced.
The market reaches the level where the project wants to buy. The treasury funds sit behind a multisig. Signers are in different time zones. The transaction needs to be prepared, reviewed, and approved.
Someone is unavailable and by the time the trade is ready, the market may no longer be offering the same opportunity.
These are all expected consequences of performing a buyback on an AMM.
And all avoidable.
