Tenetonomics Part I: Tenet Distribution
Over the next two articles we are going to take a deep dive into Tenet’s tokenomics (Tenetonomics) and how TENET token is utilised across our ecosystem. We will first recap the Tenet inflation schedule and token distribution in Part 1, and then move on to our unique chain level gauge system and how this can be applied across the Tenet network and beyond to incentivise positive activities and growth of our ecosystem in Part 2.
Tenet Token
The distribution of Tenet token is spread across various categories, each of which we will take a brief look at in this article and how these categories contribute to the overall value proposition of Tenet.
Block Rewards and veTokenomics
This is by far the most important category as it’s where the flywheel begins. 30% of the supply of Tenet is reserved for these rewards which are distributed via voting of veTenet (more on this below). These tokens are used to incentivise all onchain activities on the Tenet network but can also be utilised to incentive Tenet-centric actions on partner protocols on different chains. In this way, we create a positive feedback loop for utilisation of Tenet’s products across the ecosystem.
Team
The team’s tokens are on the longest vesting schedule (12 month cliff and 20 month vest) and represent 10% of the supply. These tokens will be locked in smart wallets that allow them to be staked to validators or locked as veTenet during the lockup period to allow the team to direct the incentivisation of key actions, such as cooperations with partner protocols or delegation to key validators.
Advisors and Consultants
Our expert advisors and consultants also play integral roles in the Tenet ecosystem and are rewarded with upto 6% of the total supply. These tokens are on the same terms and in the same form as the team’s tokens.
Public Sale and KOLs
These tokens were distributed as part of our launch campaign to early public supporters and to our KOL network. In total this represents 10% of the total supply, with 10% being unlocked and 90% being subject to a three month cliff and then linear vestige over 20 months.
Liquidity and Market Making
5% of the supply is utilised for liquidity provisioning on decentralised and centralised exchanges. These tokens were unlocked partially at TGE and then the remainder are released over a 15 month period.
Grants and Ecosystem Development
10% of the supply is reserved for this purpose, which unlocks over a 28 month period. That doesn’t mean that all of these tokens are liquid and utilised immediately, they will be distributed over time in order to properly incentivise the growth and development of a vibrant ecosystem for Tenet. Our grants take various formats including:
- liquidity grants — these tokens are utilised for liquidity pairing and are usually locked on a permanent basis, effectively removing them from circulation.
- unlocked tokens or stablecoins — designed to reimburse the costs of development teams.
- vested veTokens — designed to provide development teams with upside and aligned incentives with the Tenet team and holders.
- perpetual veTokens — tokens locked in a smart wallet that can only be re-locked as veTenet and are designed to incentivise gauges for partner protocols. These are also effectively removed from circulation.
Treasury for Acquisitions, Incentives and Fundraising
15% of the supply is held by the treasury for acquisitions (for instance acquiring proprietary technology for use in Tenet products), additional incentivisation (such as the ongoing TENET rewards currently being distributed to TENET:USDT liquidity providers on Maverick protocol) and future fund raising to support treasury growth and continued development of the protocol (for instance a strategic fund raising round). Again, although these tokens are unlocked over a 15 month period, very few of them will be in circulation immediately upon their unlock and even when distributed (for instance through a fundraising) they will be subject to lock-up periods.
Marketing and Partnerships
These tokens are utilised to support marketing for the Tenet protocol (for instance paid content or future onboarding of additional KOLs) and for partnerships (for instance to distribute tokens to partner protocols to allow them to incentivise the relevant gauges for their protocols). These tokens (representing 5% of the supply) are unlocked gradually over a 28 month period but are also not yet fully allocated and when they are distributed may be subject to lock-ups (by way of examples, TENET sent to partner protocols for gauge incentivisation would also be in the form of perpetually locked veTENET and therefore permanently removed from circulation.
Airdrops
A total of 4% of the supply has been reserved for airdrops over a 28 month period. These tokens will be utilised as an additional layer of incentivisation across a number of “seasons” in order to encourage the early adoption and usage of Tenet network and the products released on top of it.
Reserve
5% of the supply is to be held in reserve and will be utilised as needed between the other areas above or for future needs, depending on which areas are most beneficial for the project. These tokens are also released over a 28 month period but are not yet allocated to any particular area and therefore none are in circulation.
The below chart summarises the inflation schedule over time in a graphical format to show the unlock of the supply, but doesn’t necessarily represent when such tokens would be considered as “circulating” as this will depend on their allocation and any lock-ups applied.
Hopefully now you have a detailed overview of the distribution of Tenet token and the plans for how this will be released to different parties. In the next part we will dive into detail on the veTokenomics and how our gauge system works to incentivise the usage and adoption of Tenet products across the entire ecosystem.
