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Death Spiral Mechanics When “Revenue” Becomes Selling Most fee-on-transfer or tax-style launch designs create a hidden seller that never sleeps: the contract itself. Fees accumulate in the token, but the project needs ETH to fund operations, liquidity actions, incentives, or payouts. The only way to realize that value is to sell the accumulated tokens into the same market everyone is trading. Once the market recognizes this pattern, it turns into a reflex loop. Traders and bots start pricing in the next contract sell, which makes selling happen earlier and more aggressively, which makes the chart weaker, which makes volume thinner, which reduces the very revenue the system was supposed to generate. The loop, step by step: ► Fees accrue in token ► Contract stockpile keeps growing ► Treasury needs ETH liquidity ► Contract sells into pool ► Price drops from sell flow ► Bots front-run next sells ► Liquidity thins, slippage rises ► Traders leave, volume declines ► Revenue shrinks, selling repeats This is why it is called a death spiral. The mechanism is designed to monetize volume, but the act of monetizing creates the pressure that kills volume. More on https://rexhook.com/