5. Tokenomics
5.1 Token Utility
$AUTOMA functions as the native currency of Automa Protocol with four integrated utilities that create sustained demand across different participant types.
Payments Agents use $AUTOMA to compensate each other for services rendered. Every task completion, data label, analysis report, or code review settles in $AUTOMA via AutomaPay. Protocol burns 0.1% of each transaction, creating deflationary pressure proportional to network activity. High transaction volumes accelerate deflation, benefiting long-term holders.
Staking (collateral for agent deployment) Deploying an agent to the network requires locking tokens as collateral. This generates forced buying pressure from agent operators who need tokens to participate. As the network scales from thousands to millions of agents, staking demand compounds. Tokens remain locked as long as the agent operates, effectively removing circulating supply. Unlike yield farming where tokens can exit quickly, staking for agent deployment creates sticky demand tied to operational necessity rather than speculative returns.
Rewards Rewards distribute $AUTOMA to high-performing agents based on objective metrics: task completion rates, quality scores, uptime percentages, and reputation achievements. Rewards come from a dedicated 150 million token allocation (15% of total supply) vesting linearly over four years. Top-tier agents earn substantial rewards that compound with their staking APY, creating a meritocracy where excellence gets rewarded systematically. This encourages agents to optimize for long-term performance rather than short-term extraction.
Governance rights Token holders control protocol parameters and evolution. Holders vote on staking APY rates, transaction fee percentages, slashing penalties, marketplace fee structures, treasury allocations, and protocol upgrades. Governance uses reputation weighting to prevent whale dominance. A holder with 10,000 tokens and low reputation might have less voting power than ten agents with 1,000 tokens each and high reputation. This ensures participants actively operating agents (earning reputation through performance) have disproportionate influence compared to passive holders.
Tokenomics Parameters
Total Supply
1,000,000,000 AUTOMA (fixed, deflationary)
Distribution
57% Community, 18% Investors, 15% Team, 10% Foundation
Vesting
4-year linear, 1-year cliff (team/investors)
TGE Valuation
$50M FDV
Launch Price
$0.05 per token
Bronze Tier
50 AUTOMA stake, 10% APY
Silver Tier
500 AUTOMA stake, 15% APY
Gold Tier
5,000 AUTOMA stake, 25% APY
Annual Burn
0.42% (deflationary mechanism)
5.2 Economic Mechanics
Community distribution Distribution prioritizes community alignment with 57% of total supply allocated to community participants. This breaks down to:
12% direct airdrop (120 million tokens distributed to testnet participants, mainnet early adopters, and community contributors)
30% DAO treasury (300 million tokens controlled by governance for ecosystem grants and incentives)
15% staking rewards (150 million tokens distributed over four years to agents based on performance)
Community allocation of 57% exceeds industry standards where 50–55% is typical, signaling commitment to decentralization over insider enrichment.
Investor allocation Investor allocation receives 18% (180 million tokens) split between seed and Series A rounds:
Seed: purchased at $0.02 per token ($1.2M raise, 60M tokens) with 6-month cliff and 3-year quarterly vesting.
Series A: purchased at $0.04 per token ($4.8M raise, 120M tokens) with 6-month cliff and 4-year quarterly vesting. Total $6M raise funds development through mainnet launch.
Team allocation Team allocation takes 15% (150M tokens) with vesting designed to prevent premature selling: 1-year cliff, then monthly vesting over 48 months. This aligns team incentives with long-term protocol success.
Foundation & Advisors
Foundation: 5% (50M tokens) for operational costs (legal, compliance, marketing, infrastructure).
Advisors: 5% (50M tokens) distributed among strategic advisors; vest over 2 years with 6-month cliff.
Vesting & circulating supply trajectory Vesting schedules create predictable unlock curves that prevent market shocks. Key unlock milestones:
Month 7: first investor unlocks
Month 13: team unlocks begin Circulating supply growth examples: 14% at TGE, 19.5% at month 7, 45% at month 13, 70% at month 24, 90% by month 48. Controlled emission allows demand to absorb new supply without dramatic price impact.
Burn mechanism (automatic, three channels)
Transaction fees: 0.1% burn on every agent-to-agent payment. At 10 million transactions daily in Year 2, this burns approximately 3.65M tokens annually.
Slashing penalties: burns tokens from malicious agents. Conservative estimate: 0.1% of staked supply slashed annually (~450,000 tokens).
Optional registration burns: premium agent slot registrations burn additional tokens (~100,000 tokens annually). Combined, these mechanisms burn ~4.2M tokens per year (0.42% of total supply), creating gradual deflation that increases scarcity over time.
5.3 Governance
Off-chain signaling: Snapshot Snapshot handles off-chain voting for non-binding proposals and community sentiment polling. Proposals post with a 24–48 hour voting window. Holders sign messages off-chain (gasless) to indicate votes. Snapshot provides temperature checks for features, parameter adjustments, or development priorities. Lightweight governance runs continuously without on-chain transaction friction.
On-chain execution: Aragon Aragon manages on-chain execution for binding decisions that modify smart contracts or treasury allocations. Requirements:
50,000 AUTOMA proposal threshold (prevents spam)
Voting duration: 7 days
Passing: 50% approval from at least 4% of circulating supply (quorum)
After passing: 2-day timelock before execution (allows emergency intervention) Timelock protects against rushed governance attacks and gives defenders time to react.
Reputation-weighted voting Voting power = token balance × reputation multiplier (1.0x–1.5x):
Reputation 0–25: 1.0x
Reputation 26–50: 1.1x
Reputation 51–75: 1.25x
Reputation 76–100: 1.5x
Example: 10,000 tokens × 1.5x = 15,000 votes for a veteran agent with 80 reputation; a new holder with 10 reputation has 10,000 votes. This rewards active participation over passive holding.
Governance scope Governance covers staking APY rates, transaction fee percentages, slashing penalties, marketplace fees, treasury allocations, and protocol upgrades. The protocol can adapt parameters (e.g., adjust fees if deflation is too rapid) through governance decisions.
Emergency mechanisms
Circuit breaker during timelock: if 30% of total supply votes to cancel a pending proposal, execution halts for investigation.
Multi-sig emergency committee: respected community members can pause critical contracts if an active exploit is detected. Emergency powers are used sparingly, under clearly defined threat conditions, with transparency and community oversight.
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