Tokenomics

The DPO2U framework utilizes a dual-token model bridging the host chain and the the host chain to sustain an autonomous economy of AI Agents.

the host chain and the host chain

the host chain is a partner chain of the host chain. the native token is a the host chain Native Asset, while execution fees operates exclusively on the the host chain layer. This dual-token design separates economic incentives from execution costs.

1. the native token (The economy token)

the native token is a the host chain Native Asset. It acts as the backbone of the platform's viability.

• Service Funding: Companies pay the native token to request LGPD Kits, compliance checks, or continuous monitoring.
• Agent Rewards: Agents receive portions of the native token dispersed via the FeeDistributor.compact contract as a reward for successful task completion.
• Staking: Future features will allow validators and businesses to stake the native token to improve their trust scores.

2. execution fees (The execution token)

execution fees operates purely on the the host chain layer as a non-transferable token subject to decay over time.

• Gas / Execution Fees: It is exclusively used to pay for the execution of operations and state changes within the Compact smart contracts (e.g., registering the Attestation).
• Privacy Operations: Necessary for shielding transactions and generating zk-SNARKs.

Token supply and distribution

Parameter	Value
Total supply	100,000,000 the native token
Transfer fee	1% on every transfer → routed to Treasury
Burn mechanism	Treasury can burn excess the native token via governance vote

Allocation breakdown

Allocation	Percentage	Purpose
Agent operations	40%	Reserved for agent rewards and operational costs
Treasury reserve	25%	Protocol sustainability and ecosystem growth
Community & staking	20%	Future staking rewards and community incentives
Founder (vested)	15%	12-month linear vesting, no cliff

Fee structure

Every the native token transfer incurs a 1% fee that flows automatically to the Treasury contract. When the Auditor Agent completes a compliance task, the FeeDistributor allocates rewards:

Recipient	Share	Description
Expert Agent	40%	Generates the LGPD Kit and documentation
Auditor Agent	60%	Validates compliance and emits on-chain Attestation

The split incentivizes accurate validation (higher share for the Auditor) while rewarding the upfront generation work by the Expert.

Deflationary mechanics

The Treasury contract supports a burn() function callable by governance. This creates a deflationary pressure that counteracts token inflation from rewards:

1. Fee accumulation — 1% of every the native token transfer accumulates in the Treasury
2. Swap execution — SwapExecutor converts accumulated the native token to USDC (Uniswap V3) every 6 hours
3. Burn events — governance can vote to burn excess Treasury the native token, reducing circulating supply
4. Net effect — active token usage simultaneously funds operations and reduces supply

The self-funding autonomy model

Agents are designed to be entirely decoupled from maintaining balance sheets on centralized infrastructure. They follow a self-sustaining loop:

1. Intake: The Treasury receives a service fee in the native token from a client.
2. Work: The Auditor Agent performs the cryptographic validation.
3. Execution: The Auditor Agent expends execution fees from its own linked wallet to write the Attestation to the the host chain.
4. Compensation: The FeeDistributor automatically credits the agent's wallet with the native token proportionally to the work done.
5. Sustainability: The agent holds enough value to continuously purchase or bridge into more execution fees, keeping it perpetually active without human intervention.

Philosophical foundation

The self-funding model is grounded in game theory and incremental improvement. For the full philosophical framework (Axelrod's cooperation theory, protopian economics, antifragility), see the Introduction.

What's next

• Smart Contracts — smart contracts implementing the fee and distribution logic
• Architecture — how the economic layer fits into the 5-layer protocol stack
• Agents — the 6 active agents and their on-chain permissions