SC-027 — Implement Tokenomics & Incentive Distribution Framework
📚 Overview
TruthBounty's long-term success depends on a sustainable incentive model that encourages truthful participation, discourages malicious behaviour, funds protocol operations, and maintains long-term economic stability.
This issue implements the Tokenomics & Incentive Distribution Framework, defining how rewards are generated, distributed, vested, escrowed, and accounted for across every protocol participant.
The framework should ensure protocol sustainability while aligning incentives between claim creators, verifiers, token holders, governance participants, and the protocol treasury.
This issue establishes the economic foundation upon which every future reward and governance mechanism will depend.
🧠 Background
Truth verification requires incentives.
Without economic incentives:
- high-quality verifiers will leave
- malicious actors become relatively cheaper
- protocol participation declines
- governance weakens
- treasury becomes unsustainable
Conversely, poorly designed incentives create:
- reward farming
- Sybil attacks
- inflation
- treasury depletion
- protocol collapse
TruthBounty V2 therefore requires a mathematically consistent and governance-controlled incentive framework.
🎯 Objectives
Implement a protocol-wide tokenomics framework that:
- defines reward allocation
- manages incentive distribution
- preserves treasury sustainability
- supports future governance adjustments
- prevents economic exploits
- remains fully deterministic
🧩 Technical Scope
1. Economic Model
Define protocol allocation for:
- verifier rewards
- treasury reserves
- ecosystem incentives
- governance incentives
- future protocol development
- emergency reserve
Allocation percentages must be configurable through governance.
2. Reward Sources
Support rewards originating from:
- protocol fees
- treasury allocations
- governance-funded incentive pools
- ecosystem grants
- future staking emissions
Reward sources should remain modular.
3. Reward Allocation Engine
Implement deterministic allocation.
Example:
Protocol Revenue
↓
Treasury Reserve
↓
Verifier Rewards
↓
Governance Allocation
↓
Ecosystem Incentives
Every allocation must be fully auditable.
4. Distribution Policies
Support:
- proportional rewards
- reputation-weighted rewards
- stake-weighted rewards
- governance incentives
- referral incentives (future)
Reward calculations must remain deterministic.
5. Distribution Constraints
Prevent:
- duplicate rewards
- negative balances
- treasury overdraft
- excessive inflation
- reward overflow
All calculations should preserve protocol solvency.
6. Treasury Integration
Integrate with:
- Treasury Accounting
- Reward Escrow
- Governance Parameters
Every reward must pass treasury validation before distribution.
7. Governance Configuration
Governance should control:
- allocation percentages
- emission limits
- reward multipliers
- treasury reserve targets
- protocol fee allocation
Updates should preserve protocol invariants.
8. Events
Emit:
event RewardAllocated(
address recipient,
uint256 amount,
bytes32 rewardType
);
event IncentiveDistributionCompleted(
uint256 totalDistributed
);
event RewardAllocationUpdated(
bytes32 allocationType,
uint256 percentage
);
9. Read Interfaces
Expose:
- current allocation model
- reward pools
- treasury allocation
- distribution history
- emission statistics
10. Documentation
Document:
- incentive model
- allocation formula
- reward lifecycle
- treasury interaction
- governance controls
🏗 Architectural Considerations
The tokenomics framework should remain independent of any specific token implementation.
Business logic should request reward calculations from the allocation engine rather than embedding economic formulas directly into protocol modules.
🔐 Security Considerations
Protect against:
- inflation bugs
- reward duplication
- treasury exhaustion
- arithmetic overflow
- governance abuse
- reward manipulation
Reward calculations must be reproducible and deterministic.
⚡ Performance Considerations
Optimise:
- allocation calculations
- treasury lookups
- reward batching
- gas efficiency
Reward computation should scale efficiently as protocol activity increases.
🧪 Testing Requirements
Unit Tests
Verify:
- allocation calculations
- reward distribution
- treasury integration
- governance updates
- event emission
Integration Tests
Verify compatibility with:
- Treasury
- Reward Escrow
- Governance
- Reputation
- Settlement
Security Tests
Verify:
- duplicate rewards rejected
- invalid allocations rejected
- treasury protection enforced
Invariant Tests
Verify:
- allocated rewards never exceed available funds
- treasury remains solvent
- reward totals reconcile correctly
Fuzz Tests
Randomise:
- reward sizes
- allocation percentages
- treasury balances
- participant counts
Verify deterministic behaviour.
Gas Tests
Benchmark:
- allocation calculations
- reward distribution
- treasury validation
Document gas usage.
✅ Acceptance Criteria
- Economic allocation model implemented.
- Reward allocation engine completed.
- Distribution policies implemented.
- Treasury integration completed.
- Governance configuration supported.
- Events emitted correctly.
- Read interfaces implemented.
- Documentation completed.
- Unit tests completed.
- Integration tests completed.
- Invariant tests pass.
- Fuzz tests pass.
- Gas benchmarks documented.
- CI passes successfully.
📖 References
- TruthBounty Protocol V2 Specification
- Treasury Accounting Framework
- Reward Escrow Framework
- Governance Parameter Registry
- Tokenomics Design Document
⛓ Dependencies
Depends On
- SC-016 — Reward Escrow Framework
- SC-017 — Treasury Accounting Engine
- SC-019 — Governance Parameter Management
- SC-023 — Protocol Observability Framework
Blocks
- Verifier Rewards
- Governance Incentives
- Treasury Sustainability
- Protocol Revenue Distribution
- Ecosystem Growth Program
🏷 Labels
contracts
economics
treasury
governance
protocol-critical
complexity-high
stellar-wave
📊 Complexity
High
This issue establishes the economic backbone of TruthBounty, ensuring incentives remain sustainable, transparent, and resistant to manipulation. Every future reward, fee, treasury allocation, and governance-controlled emission depends upon this framework.
⏱ Estimated Effort
5–6 days
Includes:
- economic model
- allocation engine
- treasury integration
- governance controls
- testing
- documentation
- gas optimisation
🚀 Definition of Done
This issue is complete when:
SC-027 — Implement Tokenomics & Incentive Distribution Framework
📚 Overview
TruthBounty's long-term success depends on a sustainable incentive model that encourages truthful participation, discourages malicious behaviour, funds protocol operations, and maintains long-term economic stability.
This issue implements the Tokenomics & Incentive Distribution Framework, defining how rewards are generated, distributed, vested, escrowed, and accounted for across every protocol participant.
The framework should ensure protocol sustainability while aligning incentives between claim creators, verifiers, token holders, governance participants, and the protocol treasury.
This issue establishes the economic foundation upon which every future reward and governance mechanism will depend.
🧠 Background
Truth verification requires incentives.
Without economic incentives:
Conversely, poorly designed incentives create:
TruthBounty V2 therefore requires a mathematically consistent and governance-controlled incentive framework.
🎯 Objectives
Implement a protocol-wide tokenomics framework that:
🧩 Technical Scope
1. Economic Model
Define protocol allocation for:
Allocation percentages must be configurable through governance.
2. Reward Sources
Support rewards originating from:
Reward sources should remain modular.
3. Reward Allocation Engine
Implement deterministic allocation.
Example:
Every allocation must be fully auditable.
4. Distribution Policies
Support:
Reward calculations must remain deterministic.
5. Distribution Constraints
Prevent:
All calculations should preserve protocol solvency.
6. Treasury Integration
Integrate with:
Every reward must pass treasury validation before distribution.
7. Governance Configuration
Governance should control:
Updates should preserve protocol invariants.
8. Events
Emit:
9. Read Interfaces
Expose:
10. Documentation
Document:
🏗 Architectural Considerations
The tokenomics framework should remain independent of any specific token implementation.
Business logic should request reward calculations from the allocation engine rather than embedding economic formulas directly into protocol modules.
🔐 Security Considerations
Protect against:
Reward calculations must be reproducible and deterministic.
⚡ Performance Considerations
Optimise:
Reward computation should scale efficiently as protocol activity increases.
🧪 Testing Requirements
Unit Tests
Verify:
Integration Tests
Verify compatibility with:
Security Tests
Verify:
Invariant Tests
Verify:
Fuzz Tests
Randomise:
Verify deterministic behaviour.
Gas Tests
Benchmark:
Document gas usage.
✅ Acceptance Criteria
📖 References
⛓ Dependencies
Depends On
Blocks
🏷 Labels
contracts
economics
treasury
governance
protocol-critical
complexity-high
stellar-wave
📊 Complexity
High
This issue establishes the economic backbone of TruthBounty, ensuring incentives remain sustainable, transparent, and resistant to manipulation. Every future reward, fee, treasury allocation, and governance-controlled emission depends upon this framework.
⏱ Estimated Effort
5–6 days
Includes:
🚀 Definition of Done
This issue is complete when: