Token Economics

TOS Network implements a carefully designed token economic model that ensures long-term sustainability, fair distribution, and alignment of incentives across all network participants.

Token Overview

Supply Distribution

TOS follows a fair launch model with no pre-mine or initial coin offering:

Total Supply: 18,400,000 TOS
├── Mining Rewards: 90-95%
│   └── Distributed to miners via Proof-of-Work
├── Development Fund: 5-10%
│   └── Funds network development and ecosystem growth
└── No Pre-mine: 0%
    └── All tokens mined fairly

Emission Schedule

TOS uses a gradual emission reduction model:

Block Rewards

Block rewards decrease over time through halving events:

Development Fee

A transparent development fee supports ongoing network development:

Mining Economics

Proof-of-Work Model

TOS uses an ASIC-resistant mining algorithm (TOS Hash) to ensure decentralization:

Miner Incentives

Miners receive rewards from multiple sources:

1. Block Rewards: Primary emission via PoW
2. Transaction Fees: Fees from included transactions
3. DEV/DAG Bonuses: Additional rewards from BlockDAG structure

Mining Profitability Factors

Mining Revenue = Block Reward + Transaction Fees + DAG Bonus
Mining Cost = Hardware + Electricity + Maintenance
Net Profit = Mining Revenue - Mining Cost

TOS Energy Model Integration

The TOS Energy Model (TEM) creates a dual economic system:

Traditional Fee Path

User → Pays TOS as fee → Fee burned/distributed

Energy Path

User → Stakes TOS → Generates Energy → Uses Energy for transactions
       └─ TOS locked ─┘

Economic Impact

Transaction Fee Structure

Minimum Fees

Fee Distribution

Transaction fees are distributed as follows:

Transaction Fee
├── 80% → Miner (block producer)
├── 15% → DAG Contributors
└── 5% → Protocol Treasury

Deflationary Mechanisms

TOS implements several mechanisms to create deflationary pressure:

1. Fee Burning

A portion of transaction fees may be burned:

Burn Rate = Base Rate × Network Activity Factor

2. Staking Lock-up

Energy staking removes TOS from circulation:

3. Service Fees

Various protocol services require TOS:

Token Utility

TOS tokens serve multiple functions in the network:

1. Transaction Fees

Primary currency for network fees:

// Pay transaction fee in TOS
let tx = Transaction::new()
    .with_fee(Amount::from_tos(0.001))
    .build();

2. Energy Staking

Stake TOS to generate energy for gas-free transactions:

// Create energy stake
let stake = EnergyStake::new()
    .amount(10_000) // 10,000 TOS
    .duration(Duration::days(90))
    .create();

3. Governance

Future DAO participation requires TOS:

• Vote on protocol upgrades
• Propose changes
• Elect committee members

4. Collateral

Various protocol features require TOS as collateral:

5. Native Asset Creation

Create new tokens on TOS Network:

// Create a new native asset
let asset = AssetCreate::new()
    .name("My Token")
    .symbol("MTK")
    .decimals(8)
    .supply(1_000_000)
    .fee(Amount::from_tos(1.0)) // 1 TOS creation fee
    .create();

Economic Security

Attack Cost Analysis

TOS’s economic model creates high attack costs:

Security Budget

The network security budget comprises:

Security Budget = Block Rewards + Transaction Fees + Staking Value

As block rewards decrease, transaction fees and staking value must increase to maintain security.

Comparison with Other Networks

Long-Term Sustainability

Revenue Sources (Post-Mining)

As mining rewards decrease, the network will rely on:

1. Transaction Fees: Growing DeFi and application usage
2. Service Fees: Asset creation, name registration, etc.
3. Staking Revenue: Energy model participation
4. Protocol Treasury: Accumulated fees for development

DAO Transition

The development fee and protocol decisions will transition to DAO governance:

Current: Foundation-managed development fee
   ↓
Future: DAO-controlled treasury
   ↓
Goal: Fully decentralized governance

See Also

• TOS Energy Model - Stake-to-earn energy system
• Mining System - PoW mining details
• Smart Contracts - Build on TOS
• Compliance & KYC - Committee economics