Verifiable economy
A currency in the service of use, not of speculation
The value of LTS derives from real network activity, not from programmed scarcity. Those who sustain the network earn; those who only hold earn only when others use it. Every economic decision is published, verifiable, and modifiable solely through the governance procedures described in the Governance Charter.
The token
LTS: denomination and supply
LTS is the monetary unit of Basis Network. Its denomination, its cap, and its behavior under burn are fixed at genesis and only modifiable by Constituent Boulé convocation.
Denomination
Lithos, Tomos, six decimals
Six decimals match the empirical standard of cryptocurrencies most used for real-world payments. Sufficient granularity for microtransactions, AI-inference micropayments, and sampler payments under any plausible appreciation scenario. Avoids the maximalist eighteen decimals — copied without analysis by most chains — and the over-restrictive two decimals of fiat, insufficient if LTS appreciates.
Lithos
Symbol shown in user interfaces
Tomos
Atomic granularity of the protocol
1 Lithos = 10⁶ Tomos
Six fixed decimals
LTS
Identifier on exchanges and dashboards
Supply model
Asymptotic cap, neither fixed nor uncapped
Total supply never exceeds ten billion LTS. Emission decreases as supply approaches the cap; the cap is approached asymptotically, never reached. Fee burn acts as a thermostat: when the network is used, circulating supply contracts.
Genesis allocation
Distributed at TGE across the twelve buckets defined below. Insider total ≤ 24.5%, well below the industry standard.
Asymptotic emission reserve
Not allocated at TGE. Emitted gradually over decades, at 4% of the gap per year, toward the six productive inflation buckets.
Theoretical cap (asymptotic ceiling)
Total supply never exceeds it. Burn destroys supply; emission re-mints toward the cap as long as the gap exists.
Structure comparable to conservative asymptotic-cap L1 chains. Avoids the budget fragility of fixed-cap chains facing block-subsidy exhaustion, and avoids the calibration fragility of purely dynamic emission models.
The eight productive uses
What LTS is for, and what it is not
LTS has eight productive uses, each tied to a specific economic actor or activity. The design is biased to favor productive participation over passive holding: circulating supply contracts when the network is used, not when it is speculated upon.
Transaction gas
Fuel for any operation on the network under Standard or OperatorSponsored fee policy. On ZeroFee subnets the end user pays nothing; the operator absorbs the cost.
Network validator stake
Economic collateral (skin-in-the-game) to participate in the consensus role. Subject to real slashing in case of equivocation, sustained downtime, or demonstrable censorship.
Private subnet operator stake
Bonded to honest proof submission. 50% slashing for invalid proof — the severity reflects the operator's unilateral control over their subnet's state.
Payment to DAS samplers
Pro-rata compensation to those who verify data-availability proofs each epoch. Dedicated inflation bucket.
ZeroFee anchoring payment (α)
Operators selecting ZeroFee policy pay α per epoch to the protocol, compensating the externalized cost of security. 90% burned, 10% to Treasury.
Payment to KYC / KYB verifiers
Accredited identity providers receive LTS per verification effectively performed and registered on-chain. Dedicated inflation bucket.
Ecosystem medium of exchange
Cross-subnet payments, service subscriptions, distributed AI-inference micropayments. Transaction velocity grows with real use, not with speculative activity.
Civic officeholder stake
Members of La Veeduría and El Consistorio post collateral. Slashable in cases of proven audit dishonesty or undisclosed conflict of interest.
What LTS does NOT confer
LTS does not confer political voting power
Voting in any civic institution is one-identity-one-vote, conditioned on KYC verification. The political power of the network is neither bought nor accumulated with capital. This is structural, not decorative: civic institutions operate on verified identity, not on stake.
Genesis and vesting
How the initial seven billion are distributed
The theoretical cap (10B LTS) decomposes into three structural layers. The genesis allocation (7B = 70% of cap) is split across twelve buckets closed in Layer C. Insider total ≤ 24.5%, well below the industry red line (40%). Percentages are expressed against the cap (10B LTS) as the canonical reference.
| # | Bucket | % of cap | LTS |
|---|---|---|---|
| 01 | Founder principal 80% of the combined founder bucket, mirroring the equity split in Basis Industries. | 4.48% | 448M |
| 02 | Co-founder 20% of the combined founder bucket. | 1.12% | 112M |
| 03 | Team token pool For protocol contributors. Case-by-case assignment per role. | 7% | 700M |
| 04 | Early investors (SAFE) Via token warrants 1:1 pro-rata with Industries SAFE investors. | 8.4% | 840M |
| 05 | Future investors reserve Reserve for Series A/B/C rounds. Vesting ≥ SAFE terms. | 3.5% | 350M |
| 06 | Foundation endowment Perpetual endowment, diversified composition. 3–4% yield covers operations indefinitely. β+γ safety net. | 10.5% | 1.05B |
| 07 | Civic Treasury seed Seed for the Asamblea del Tesoro. Bootstrap-locked until 100 active members. Grows continuously via 20% of inflation. | 5.6% | 560M |
| 08 | Reserve / Stabilization Fund seed Capital for incident response. Disbursement requires 2/3 of Cabildo Técnico + Veeduría confirmation. | 3.5% | 350M |
| 09 | Ecosystem fund Grants to external builders. Released in 1/40 quarterly tranches (10-year horizon). | 8.4% | 840M |
| 10 | Community / airdrop 30% TGE airdrop to verified testnet users, 30% Mérito Público years 1–3, 40% gradual release years 1–5 via civic participation. | 9.1% | 910M |
| 11 | Initial validator stake pool Stake collateral capital (skin-in-the-game) for the first 7–13 validators. NOT a salary substitute — salary flows continuously from inflation starting day 1. | 4.9% | 490M |
| 12 | Initial liquidity provisioning Lock-up with professional market makers. 25% available at TGE, remainder over 12–24 months per KPIs. | 3.5% | 350M |
Total insider
24.5%
2.45B
Below the industry red line (40%)
Total non-insider
45.5%
4.55B
Foundation + Treasury + Reserve + Ecosystem + Community + Validators + Liquidity
Genesis total
70%
7B
Twelve buckets at TGE
Asymptotic reserve
30%
3B
Emitted gradually over decades (§ Continuous flow)
Theoretical cap
100%
10B
Asymptotic ceiling that supply never exceeds
Vesting
Per-bucket release schedule
Founder vesting (5 years with a 1-year cliff) exceeds the industry standard (4 years) to signal long-horizon commitment, coherent with a manifesto of cryptographic republicanism.
| Bucket | Vesting | Cliff | Note |
|---|---|---|---|
| Founder principal | 5 years linear | 1 year | Acceleration only on documented death or disability. |
| Co-founder | 5 years linear | 1 year | Same terms as founder principal. |
| Team token pool | 4 years linear | 1 year | Per contributor; vesting starts on individual contribution date. |
| Early investors (SAFE) | 3 years linear | 6 months | SAFE standard. Token warrants pro-rata with equity vesting. |
| Future investors reserve | ≥ 3 years linear | ≥ 6 months | Rule: future rounds cannot have vesting less strict than SAFE. |
| Foundation endowment | No individual vesting | — | Perpetual. Liquidation cap: 5% of endowment/year without 2/3 board approval. |
| Civic Treasury seed | No individual vesting | — | Bootstrap-locked. Pre-bootstrap: spending ≤ 5% per quarter. |
| Reserve Fund seed | No individual vesting | — | Locked. Disbursement only on recognized incident (2/3 Cabildo + Veeduría). |
| Ecosystem fund | 10 years linear | — | ≈30M LTS/quarter. Acceleration via 2/3 Asamblea + extraordinary Boulé. |
| Community / airdrop | Per sub-distribution | Varies | 30% TGE, 30% Mérito Público years 1–3, 40% civic participation years 1–5. |
| Initial validator stake pool | 3 years linear | — | Per validator. Return-on-withdrawal if operation ceases. Slashing applies throughout. |
| Initial liquidity provisioning | Per MM contract | — | 25% TGE, remainder over 12–24 months per KPIs (uptime, max spread, min depth). |
Continuous flow
How LTS enters the system, and how it leaves
Each epoch emits new LTS according to the asymptotic-cap formula and distributes it across six productive buckets. In parallel, fees paid for use are burned almost in their entirety and a small fraction funds the civic Treasury. Numerical values are opening conditions — adjustable by the Asamblea del Tesoro within declared bands — not universal protocol constants.
Emission formula
annual_rate (opening)
4% of gap / year
Governance band: 2%–7%. Changes outside the band require Boulé Constituyente.
Initial gap (TGE)
3,000,000,000 LTS
= asymptotic emission reserve = 30% of cap.
Emission decreases as supply approaches the cap. The cap is never reached. When burn destroys supply, additional gap opens and emission re-mints toward the cap — a secondary cycle perpetually active.
Six inflation buckets
Who receives newly emitted LTS
| Bucket | Opening | Function |
|---|---|---|
| Network validators | 38% | Pro-rata by attested consensus participation during the epoch. |
| DAS samplers | 17% | Pro-rata by proofs verified. Higher share than benchmark because samplers verify STARK proofs (technically more demanding than conventional DA sampling). |
| KYC / KYB verifiers | 10% | Per verification effectively performed and on-chain registered. Epoch residual redirects to the Civic Treasury. |
| Subnet operators (incentive) | 5% | In proportion to verified network activity generated by each operator. Complement to their commercial revenue. |
| Civic Treasury | 20% | Direct allocation to the Asamblea del Tesoro. Also receives residuals from other buckets. |
| Reserve / Stabilization Fund | 10% | Direct allocation. Diversified composition. Disbursement only on recognized incident. |
Founders, team, early investors, and the Foundation are NOT in the inflation buckets. Their allocations come from genesis (with vesting). Recurring inflation to those actors would be capture.
Fee model
Burn as thermostat
When the network is used, fees are burned almost entirely. Circulating supply contracts. When use diminishes, asymptotic emission re-mints to maintain flow to productive actors. The holder who never participates productively gains only when others use the network.
Burn
90%
Preserves the deflationary bias under intense use.
Civic Treasury
10%
Direct flow from network use to civic public goods. Creates a virtuous loop: more use → more Treasury → more public goods → more use.
Validators
0%
Validators are compensated via inflation (§ buckets), not via fees. Fees are paid for use, not for capture.
Governance band: burn 80–95% / Treasury 5–20%.
ZeroFee α + β
How subnets that don't charge their users subsidize themselves
Operators that select the ZeroFee policy must compensate the protocol for the externalized cost of security. The mechanism is hybrid: periodic anchoring payment (α) + stake bonded by usage (β). Both are paid by the operator. The end user pays zero, as intended.
α — Periodic anchoring
10 LTS / epoch
Fixed payment per epoch the operator owes the protocol. Floor cost for existing as a ZeroFee subnet. Calibrated to cover the marginal cost of maintaining a subnet in the global cluster; accessible to local governments, universities, NGOs, SMEs. 90% burned, 10% to Treasury.
β — Stake bonded by usage
100,000 LTS base + 0.01 LTS per tx / epoch
The operator immobilizes LTS proportional to their subnet's transaction volume. Not burned: the cost is the opportunity cost of locked capital. Released on subnet decommissioning or migration to Standard policy.
Reserves and sustainability
Why the Foundation does not depend on recurring inflation
The Foundation custodies the protocol. If the Foundation depended on recurring inflation, its neutrality over the monetary model would be compromised — it would be judge and party. Its sustainability is guaranteed by another mechanism: perpetual endowment + conditional safety net. The Reserve, separate, maintains diversified composition to avoid procyclical failure.
Foundation sustainability
Mechanism β + γ
The Foundation does NOT receive recurring inflation, by design. Its sustainability rests on two parallel mechanisms: a perpetuity-calibrated endowment whose conservative yield covers operations indefinitely, and an automated conditional top-up activable only under strict conditions verified by La Veeduría.
Perpetuity-calibrated endowment
1,050,000,000 LTS allocated at TGE. Diversified composition (40% stablecoins, 20% external reference cryptoassets, 5% tokenized gold, 30% LTS partially staked, 5% productive infrastructure). Conservative yield 3–4% annual covers operations indefinitely.
Automated conditional top-up
Transfer from the Civic Treasury to the endowment activable only if simultaneously: (a) the real endowment value (inflation-adjusted) has fallen below 50% of its initial level, AND (b) La Veeduría confirms in a formal audit that the depletion is not attributable to mismanagement. When activated: 10% of shortfall per year until restoring to 70% of initial real value.
Each quarter the Foundation publishes an endowment health report (current value vs. initial real, trailing 12-month yield, projected runway, % consumed, composition vs. target). Transparency is the continuous accountability mechanism; γ is only the last-resort safety net.
Reserve composition
Why it is not 100% LTS
A Reserve denominated entirely in the network's native currency fails procyclically: in a crisis affecting LTS value, the Reserve loses response capacity at exactly the moment its response is most needed. Documented cases of monetary collapse from procyclical reserves in recent crypto history confirm the pattern.
| Asset class | Target weight | Function |
|---|---|---|
| Established external stablecoins, fiat-pegged | 30% | Day-to-day stability and immediate liquidity for emergencies. |
| Exogenous reference cryptoassets (uncorrelated with LTS) | 25% | Crypto-native exposure diversified from the system's own asset. |
| Tokenized gold | 5% | Hedge against systemic full-cycle crypto crises. |
| LTS (partially staked in productive roles) | 30% | Maintains alignment with the ecosystem; generates yield from validator role. |
| Productive infrastructure (compute, services, contracts) | 10% | Long-horizon non-monetary reserve. |
Algorithmic conversion (deterministic DCA) by default. Changes to target weights: 3/4 of the Asamblea del Tesoro with Plaza Común consultation ≥ 60 days.
Disbursement
How the Reserve is spent
Reserve disbursement requires 2/3 of the Cabildo Técnico plus Veeduría confirmation that the triggering event is a recognized incident category (slashing reversal, protocol attack response, cross-subnet contamination, etc.). Non-incident requests are rejected by procedural default.
Modification
How this economic model is changed
Layer A (genesis-locked decisions: denomination, cap, productive uses, fee model, identity): Constituent Boulé convocation. Layers B–D (closed structural parameters): 3/4 of the Asamblea del Tesoro + 60 days of Plaza Común consultation. Layer E (numerical calibration within bands): 2/3 of the Asamblea del Tesoro.