6. Token Economics

The $ORIGYN token powers the protocol through multi-utility design that aligns incentives across creators, validators, and users.

Token mechanics create demand through usage, reduce supply through burns, and reward participation through staking yields. This section details how the token functions within the ecosystem and how economic design supports long-term sustainability without requiring continuous inflation or external subsidies.

6.1 Token Utility

Multi-Utility Model

$ORIGYN serves six distinct functions within the protocol, each driving demand or reducing circulating supply:

Registration Fees

Registration fees represent the primary utility and burn mechanism.

Each model registration costs 100 $ORIGYN tokens (approximately $2 at $0.02/token launch price). The smart contract splits this payment with mathematical precision: 70 tokens burn permanently to address 0x000...000, reducing circulating supply forever. 30 tokens flow to the protocol treasury, funding development, security audits, and infrastructure.

This 70/30 split creates strong deflationary pressure as registration volume increases while ensuring protocol sustainability.

At 10,000 registrations per year, 700,000 tokens burn annually (0.07% of total supply), with 300,000 tokens funding operations. As adoption scales to 100,000 registrations (reaching 0.1% of HuggingFace's 500,000+ models), annual burns reach 7 million tokens while treasury receives 3 million tokens for continued development.

Royalty Payment Currency

All royalty payments between creators flow in $ORIGYN tokens.

When Model C generates $10,000 in revenue and owes $750 in royalties to ancestors, the operator converts revenue to $ORIGYN tokens and distributes through the smart contract. This creates continuous buy pressure as commercial models scale, with demand recurring as long as models generate revenue rather than one-time like registration fees.

Model creators receiving royalties can hold tokens for appreciation, sell on exchanges for operating capital, or stake for validator rewards.

Each choice supports the ecosystem differently: holding reduces circulating supply, selling provides liquidity for new buyers, and staking secures the network while earning yields.

Validator Staking

Validators must lock 10,000 $ORIGYN tokens minimum to operate validation nodes.

Validators earn 8-12% APR from two sources: 20% of registration fee treasury allocation (30% of fees × 20% = 6% of total registration fees distributed to validators), and 50% of slashed stakes from successfully challenged fraudulent registrations. With 100 active validators, 1 million tokens remain locked in staking contracts, removing significant supply from circulation and creating scarcity that supports price appreciation.

The staking yield targets market competitiveness: higher than bank savings (0.5-2%), comparable to moderate DeFi yields (8-15%), and attractive relative to risk given protocol stability.

Challenge Mechanism

Challengers must stake 1,000 $ORIGYN tokens to dispute potentially fraudulent registrations.

When a validator approves a registration claiming false parentage or plagiarized models, anyone can challenge by staking tokens and providing evidence. A 7-day voting period allows validator consensus on the dispute. Successful challenges return the challenger's stake plus 10% bonus from the slashed validator, incentivizing community policing. Failed challenges result in burned stake, discouraging frivolous disputes that waste validator time.

This mechanism ensures registry integrity through economic incentives rather than centralized authority.

Governance Voting

Token holders vote on protocol parameters following the standard one-token-one-vote model.

Proposals cover registration fee amounts (adjusting for token price changes), royalty formula defaults (base rate, decay rate, cap percentage), validator requirements (minimum stake, slashing tiers), and smart contract upgrades (implementation changes through UUPS proxy). Proposals require 10% quorum (100 million tokens voting if circulating supply is 1 billion) and >50% approval to pass.

A 48-hour timelock after passage allows community reaction before execution, preventing governance attacks where malicious proposals execute immediately.

Premium Features Access

Users lock 5,000 $ORIGYN tokens for one year to access advanced platform capabilities.

Premium features include detailed analytics showing model influence and derivative tracking, higher API rate limits for commercial integrations, early access to new features before general release, and priority support from the protocol team. This creates voluntary token locking that reduces circulating supply while funding premium service development, with users able to unlock tokens after the commitment period while retaining any accrued governance rights.

Token Distribution

The fixed supply of 1 billion $ORIGYN tokens allocates across stakeholder groups to balance immediate liquidity, long-term alignment, and ecosystem growth:

Community Allocation (40% / 400M tokens)

Community allocation distributes over 5 years through multiple programs.

Model registration rewards (15% / 150M) incentivize early adopters by subsidizing registration fees: first 1,000 registrations receive 100 $ORIGYN rebates, next 10,000 receive 50 $ORIGYN rebates, gradually decreasing as adoption grows. This front-loaded distribution attracts initial users when network effects are weakest.

Validator rewards (10% / 100M) provide initial staking yields before registration fees generate sufficient revenue, ensuring validator participation from launch. Without this subsidy, early validators would earn minimal rewards when registration volume is low, creating a chicken-and-egg problem.

Liquidity mining (10% / 100M) rewards users who provide trading liquidity on decentralized exchanges, enabling price discovery and minimizing slippage. Liquidity providers earn yields proportional to their share of the pool, incentivizing deep liquidity that supports smooth token trading.

Development grants (5% / 50M) fund community developers building integrations, tools, and analytics. Grant recipients demonstrate value through working prototypes, with larger grants for widely-adopted tools like HuggingFace extensions or MLflow plugins.

Team Allocation (20% / 200M tokens)

Team allocation vests over 4 years with 1-year cliff.

Founders and core developers receive no tokens for the first year post-launch, aligning incentives with long-term success rather than quick exits that harm token holders. After the cliff, tokens vest linearly monthly over 3 additional years, matching typical venture-backed startups while ensuring team commitment through protocol maturation. Team members can stake vested tokens for validator rewards, participate in governance, or provide liquidity, each supporting the ecosystem while building personal stakes.

Investor Allocation (15% / 150M tokens)

Investor allocation follows identical vesting: 1-year cliff, 4-year linear vest.

Strategic investors provide capital for development, audits, and initial infrastructure. Vesting prevents immediate selling pressure while ensuring investors remain engaged through the critical growth phase, with their interests aligned to long-term protocol success. Investor terms prohibit lending vested tokens or using them as collateral for derivative positions, preventing cascading liquidations if token price drops during market downturns.

Treasury Allocation (15% / 150M tokens)

Treasury allocation remains unlocked but controlled by governance.

The treasury funds ongoing operations including smart contract audits by reputable firms (OpenZeppelin, Trail of Bits), infrastructure costs for IPFS pinning nodes and indexing services, security bug bounties encouraging responsible disclosure, exchange listings to improve liquidity and accessibility, and marketing to reach model creators and enterprises. Treasury spending requires governance approval for amounts exceeding 1 million tokens per quarter, ensuring community oversight of large expenditures.

Liquidity Allocation (10% / 100M tokens)

Liquidity allocation pairs with equivalent ETH or USDC to seed decentralized exchange pools.

Initial liquidity on Uniswap V3 enables trading without depending on centralized exchanges that may delay listings or impose high fees. The protocol owns this liquidity (Protocol-Owned Liquidity), earning trading fees that return to treasury, creating sustainable funding that doesn't require selling tokens or inflating supply. As trading volume grows, fee income compounds, potentially covering infrastructure costs without treasury token sales.

Vesting Schedule and Fair Launch

The vesting timeline ensures gradual token distribution without sudden supply shocks:

Year 1: Community allocation begins (80M tokens distributed), team and investor cliff (0 tokens released), treasury spends moderately (10M tokens for operations), liquidity remains locked in DEX pools. Total circulating supply reaches approximately 190M tokens (19% of total), concentrated in active community participants who registered models, provided liquidity, or ran validators.

Year 2: Team and investor vesting begins (50M tokens combined), community distribution continues (80M tokens), treasury spending increases for growth initiatives (20M tokens). Circulating supply reaches 340M tokens (34%), with diverse holders including early adopters, team members, and investors all with long-term stakes.

Year 3: Vesting continues across all categories. Community allocation ramps down as organic adoption replaces incentives (60M tokens). Team and investor vesting progresses (50M tokens). Circulating supply reaches 450M tokens (45%), with protocol maturity reducing dependence on token incentives.

Year 4: Final year of community rewards (40M tokens), team and investor vesting completes (50M tokens). Circulating supply reaches 540M tokens (54%). At this point, registration fees and organic usage drive demand rather than token distribution incentives, demonstrating protocol sustainability.

Year 5: Community rewards end, all vesting completes. Remaining treasury and liquidity tokens represent the only centralized holdings. Circulating supply stabilizes near 700-800M tokens depending on treasury spending and liquidity management, with 200-300M locked in staking and premium features creating natural scarcity.

Fair launch principles guide distribution strategy.

No public token sale or auction prevents speculation-driven pumps and dumps that harm long-term holders. No pre-mine for founders beyond allocated team tokens ensures fairness. All community tokens require participation: register models, validate registrations, provide liquidity, or build tools. This merit-based distribution creates a community of builders and users rather than speculators seeking quick gains.

6.2 Validator Economics

Requirements and Rewards

Validators secure the registry by reviewing registrations and participating in dispute resolution.

Operating a validator requires technical capability (running an Ethereum node or using RPC providers like Infura/Alchemy), economic stake (10,000 $ORIGYN minimum, approximately $200 at launch), and active participation (respond to challenges within 48 hours or face slashing). The minimum stake remains accessible compared to other networks: Ethereum 2.0 requires 32 ETH ($64,000), Cosmos validators typically stake 100,000+ tokens, and The Graph requires 100,000 GRT ($10,000).

Origyn's lower barrier enables broader participation from individual developers rather than requiring institutional capital.

Validator rewards come from three sources.

Registration fee allocation distributes 20% of the 30% treasury portion (6% of total fees) to validators proportionally by stake. With 100 validators each staking 10,000 tokens, a validator earns 1% of this pool. At 10,000 registrations annually generating 1 million tokens in fees, the validator earns 600 tokens (6% of 10,000 total fees × 1% share).

Challenge rewards provide additional income when validators correctly vote on disputes. Validators who correctly vote on challenges receive 25% of slashed stakes (the other 25% goes to the successful challenger, 50% burns). With successful challenges averaging Tier 2 slashing (5,000 tokens), correct voters collectively receive 1,250 tokens split proportionally.

Optional protocol inflation could supplement rewards if registration fees prove insufficient, though the fixed supply model avoids this if possible to maintain token scarcity.

Target APR of 8-12% makes validation economically attractive without requiring excessive yield.

At 10,000 token stake and 10% APR, a validator earns 1,000 tokens annually, worth $20 at $0.02/token. As token price appreciates or registration volume increases, APR can decrease while maintaining dollar-denominated rewards that remain competitive with alternative investments. The protocol adjusts validator count to maintain target yields: more registrations support more validators, fewer registrations mean smaller validator sets, preserving per-validator economics.

Slashing and Accountability

Three-tiered slashing enforces accountability while calibrating punishment to offense severity:

Tier 1: Late Response (10% slash)

Late response slashing applies when validators fail to respond to challenges within 48 hours.

This indicates operational negligence rather than malicious behavior. A validator with 10,000 tokens loses 1,000 tokens, reducing their stake to 9,000. They can restake to return to 10,000, but repeated infractions compound penalties. Three Tier 1 slashes within 6 months result in automatic removal from the validator set for 30 days, forcing operational improvements before rejoining and demonstrating reliability.

Tier 2: Approve Fraud (50% slash)

Fraud approval slashing applies when validators approve registrations later proven fraudulent through successful challenges.

This could indicate either sophisticated attacks that fooled the validator or insufficient due diligence. A validator loses 5,000 of their 10,000 token stake, with the severity reflecting that fraudulent registrations undermine protocol integrity. Validators can restake but face heightened scrutiny on future approvals, with repeated Tier 2 slashes leading to permanent removal.

Tier 3: Malicious Collusion (100% slash)

Malicious collusion slashing applies when evidence proves validators coordinated with fraudulent registrants deliberately.

This might involve off-chain payments, shared identities, or repeated patterns of approving related fraudulent registrations. The validator loses their entire 10,000 token stake and receives permanent ban from the validator set, with the maximal punishment deterring the most harmful behavior that could destroy registry credibility and user trust.

Slashing proceeds distribute to multiple parties rather than disappearing.

50% burns permanently, increasing scarcity. 25% rewards the successful challenger who identified the issue, covering their time and effort. 25% rewards validators who voted correctly on the challenge, compensating them for diligent participation. This distribution ensures challenges are worthwhile for initiators while rewarding honest validators who maintain network integrity.

Delegation and Accessibility

Token holders who cannot run validators can delegate their tokens to active validators, earning a share of rewards minus commission.

A holder with 5,000 tokens (below the 10,000 minimum) delegates to a validator charging 10% commission. When the validator earns 1,000 tokens in rewards, delegators collectively receive 900 tokens (90% after commission) split proportionally. The 5,000 token delegator receives approximately 450 tokens if the validator's total stake plus delegations equal 10,000 tokens (5,000/10,000 × 900).

Validators set their own commission rates (5-20% typical) balancing competitiveness and reward.

Low commission attracts delegators but reduces validator income. High commission maximizes validator income but drives delegators to competitors offering better terms. Market dynamics find equilibrium where validators charge enough to cover operational costs (server hosting, monitoring tools, 24/7 availability) plus profit margin while remaining attractive to delegators seeking yields.

Delegation enables passive income for long-term holders while concentrating operational responsibility on professional validators.

Delegators accept some slashing risk: if their chosen validator gets slashed, delegated tokens slash proportionally, creating skin in the game. This incentivizes delegators to choose validators with strong track records and transparent operations rather than highest yields alone, creating market discipline on validator quality where reputation becomes valuable.

Comparison to Other Networks

Positioning Origyn's validator economics relative to established networks:

Ethereum 2.0 requires 32 ETH ($64,000) stake, earns approximately 4% APR, involves 8-12 minute block proposals with complex consensus, and includes slashing for double-signing or prolonged downtime. Origyn's 10,000 token ($200) stake is 99% cheaper, 8-12% APR is 2-3x higher yield, operations are simpler (registration review rather than block production), and slashing conditions are clearer (fraud rather than consensus failures).

Cosmos Hub features variable stake requirements (top 175 validators by stake), 7-20% APR depending on inflation and staking ratio, complex governance with many proposal types, and social slashing for perceived misbehavior. Origyn offers fixed 10,000 token minimum ensuring predictable entry cost, target 8-12% APR with transparent calculation, focused governance on protocol parameters, and objective slashing criteria based on fraud rather than social consensus that could be manipulated.

The Graph requires 100,000 GRT (~$10,000) for indexers, 10-15% APR from query fees, technical operation (running indexing nodes with terabytes of data), and curator delegation to subgraphs. Origyn's 10,000 token stake is 90% cheaper, comparable 8-12% APR, simpler operation (reviewing registrations rather than indexing entire blockchains), and direct delegation to validators rather than complex curation markets with multiple layers.

Origyn's design optimizes for accessibility and simplicity.

Lower stake requirements enable broader participation from individual developers rather than institutions. Higher APR compensates for early-stage risk and smaller absolute dollar amounts that might not justify institutional attention. Registration review requires less technical sophistication than running blockchain nodes or indexing services, with validators focusing on provenance verification rather than infrastructure operations. This combination attracts validators who cannot commit $10,000-$64,000 or operate complex infrastructure but want to earn yields through protocol participation.

6.3 Royalty Distribution Mechanism

Waterfall Formula Deep Dive

The royalty formula Royalty(N) = BaseRate × (DecayRate^N) × Contribution × Revenue computes each ancestor's share through four parameters:

BaseRate (default 5% = 0.05)

BaseRate sets the immediate parent royalty, aligning with established IP licensing.

Patent royalties typically range 3-5% in pharmaceuticals, software, and hardware. Music streaming royalties range 5-10% paid to rights holders by Spotify and Apple Music. Book royalties range 10-15% but involve different cost structures with physical manufacturing and distribution.

The 5% default balances creator compensation with derivative incentives.

If set too high (15%), derivatives become economically unviable after a few generations, with total royalty burden exceeding profit margins on many commercial applications. If set too low (1%), base model creators receive insufficient reward for their contribution, undermining incentives to create high-quality base models that enable derivative works.

Creators can customize this rate from 0% (fully open) to 10% (maximum allowed) when registering models, with the default applying if not specified.

DecayRate (default 0.5 = 50% reduction per generation)

DecayRate exponentially decreases royalties as ancestry distance increases.

Generation 0 (immediate parent) applies no decay: 5% × 0.5^0 = 5%. Generation 1 (grandparent) applies one decay step: 5% × 0.5^1 = 2.5%. Generation 2 (great-grandparent): 5% × 0.5^2 = 1.25%. The geometric series converges: summing infinite generations yields 5% + 2.5% + 1.25% + ... = 10%, well below the 20% cap.

This decay reflects diminishing influence where immediate parents contributed most directly while distant ancestors contributed through intermediate derivatives.

Generation Depth N

Generation depth starts at 0 for the immediate parent and increments by 1 for each step backward.

Model D derives from C derives from B derives from A: C is generation 0, B is generation 1, A is generation 2. The formula applies separately to each ancestor, with smart contracts traversing the DAG to identify all ancestors and their generation depths through breadth-first search that handles multi-parent cases correctly.

ContributionWeight (range 0.0-1.0)

ContributionWeight splits royalties for multi-parent models.

Model C merges Models A (60%) and B (40%) through weighted averaging of their parameters. When Model D derives from C, it owes royalties to both A and B through C. The calculation becomes: A receives 5% × 0.5^1 × 0.6 = 1.5%, B receives 5% × 0.5^1 × 0.4 = 1.0%. The contribution weights prevent ancestors from receiving full royalty when they provided only partial influence, ensuring fairness in merged model scenarios.

Default Parameters Rationale

The 5% base rate emerged from cross-industry analysis.

Patent licensing in pharmaceuticals, software, and hardware typically charges 3-5% of product revenue, with higher rates for breakthrough technologies and lower rates for incremental improvements. Music streaming services (Spotify, Apple Music) pay approximately 6-8% to record labels and artists, split further among songwriters, performers, and producers. Book publishing royalties range 10-15% but involve different cost structures with physical goods manufacturing and retail distribution taking significant margins.

The 5% default positions in the middle of patent and music ranges, accounting for AI models being primarily digital intellectual property without manufacturing costs.

The 0.5 decay rate balances two objectives.

First, rewarding base model creators fairly: without decay, infinite ancestors could each claim 5%, creating unbounded obligations that make derivatives economically impossible. With 0.5 decay, the infinite series sums to 10%, and practical lineages rarely exceed 5 generations (contributing 9.375% total). Second, maintaining derivative viability: if decay is too slow (0.9), deep lineages accumulate excessive royalties discouraging innovation. If decay is too fast (0.2), immediate parents receive 5% but grandparents receive only 1%, undervaluing base models that enabled the entire derivative chain.

The 0.5 midpoint respects both considerations, creating sustainable economics across multiple generations.

The 20% total cap prevents edge cases where unusual lineage structures or parameter choices create excessive burdens.

While the default parameters rarely exceed 10% total royalty even with deep lineage, custom parameters or unusual DAG structures could theoretically reach higher amounts. The cap provides certainty: derivative creators know their maximum royalty obligation is 20%, enabling business planning and pricing strategies without surprise obligations that destroy business models. If calculated royalties exceed 20%, the smart contract proportionally reduces each ancestor's share to fit within the cap, preserving relative attribution while enforcing the limit.

Detailed Calculation Examples

Example 1: Simple Linear Chain

Model A (base model) → Model B (fine-tune) → Model C (fine-tune)

Model C generates $10,000 in licensing revenue.

Calculations:

• Model C's creator pays total royalties: $750 (7.5%)

• Model B (Gen 0): $10,000 × 0.05 × 0.5^0 × 1.0 = $500

• Model A (Gen 1): $10,000 × 0.05 × 0.5^1 × 1.0 = $250

• Model C's creator retains: $10,000 - $750 = $9,250 (92.5%)

If Model D then fine-tunes from Model C and earns $20,000:

• Model C (Gen 0): $20,000 × 0.05 × 0.5^0 × 1.0 = $1,000

• Model B (Gen 1): $20,000 × 0.05 × 0.5^1 × 1.0 = $500

• Model A (Gen 2): $20,000 × 0.05 × 0.5^2 × 1.0 = $250

• Total royalties: $1,750 (8.75%)

• Model D's creator retains: $18,250 (91.25%)

Example 2: Multi-Parent Merge

Model A (medical specialist) + Model B (radiology specialist) → Model C (merged 60%/40%)

Model C generates $15,000 revenue.

Calculations:

• Model C has two parents with specified contributions

• Model A (Gen 0): $15,000 × 0.05 × 0.5^0 × 0.6 = $450

• Model B (Gen 0): $15,000 × 0.05 × 0.5^0 × 0.4 = $300

• Total royalties: $750 (5%)

• Model C's creator retains: $14,250 (95%)

Now Model D fine-tunes from Model C and earns $20,000:

• Model C (Gen 0): $20,000 × 0.05 × 0.5^0 × 1.0 = $1,000

• Model A (Gen 1 through C): $20,000 × 0.05 × 0.5^1 × 0.6 = $300

• Model B (Gen 1 through C): $20,000 × 0.05 × 0.5^1 × 0.4 = $200

• Total royalties: $1,500 (7.5%)

• Model D's creator retains: $18,500 (92.5%)

Example 3: Deep Lineage with Cap

Model A → B → C → D → E → F → G → H → I → J (10 generations)

Model J generates $50,000 revenue.

Calculations without cap:

• Gen 0 (I): $50,000 × 0.05 × 0.5^0 = $2,500

• Gen 1 (H): $50,000 × 0.05 × 0.5^1 = $1,250

• Gen 2 (G): $50,000 × 0.05 × 0.5^2 = $625

• Gen 3 (F): $50,000 × 0.05 × 0.5^3 = $312.50

• Gen 4 (E): $50,000 × 0.05 × 0.5^4 = $156.25

• Gen 5 (D): $50,000 × 0.05 × 0.5^5 = $78.13

• Gen 6 (C): $50,000 × 0.05 × 0.5^6 = $39.06

• Gen 7 (B): $50,000 × 0.05 × 0.5^7 = $19.53

• Gen 8 (A): $50,000 × 0.05 × 0.5^8 = $9.77

• Total calculated: $4,990 (9.98%)

Since 9.98% < 20% cap, all ancestors receive full calculated amounts.

Model J's creator pays $4,990 and retains $45,010 (90.02%). If instead the base rate was set to 10% (double the default), calculated total would be $9,980 (19.96%), still under the cap. At 11% base rate, calculated total reaches $21,978 (21.98%), triggering the cap where the smart contract would proportionally reduce all payments by a factor of 20/21.98 = 0.9098, ensuring total royalty equals exactly $10,000 (20%).

Edge Cases and Handling

Circular References

The DAG structure prevents cycles through registration-time validation.

If Model B attempts to register with Model C as parent, but Model C lists Model B in its ancestry, the registration fails with an error message. The smart contract traverses the proposed parent's ancestry tree and rejects any registration that would introduce its own model ID into the resulting graph, maintaining acyclicity essential for topological sorting during royalty calculation.

Orphaned Models

If a model's parent metadata becomes unavailable (IPFS pin failure), the on-chain parent reference persists.

Royalty calculations continue using the on-chain parent ID and contribution weight stored immutably. The orphaned parent's creator still receives payments through their Ethereum address stored on-chain, with royalty distribution unaffected by metadata availability. Users querying full lineage see the parent relationship exists but cannot retrieve detailed metadata until IPFS content restores or Arweave backups are accessed.

Fractional Cent Royalties

Deep ancestry with small revenue amounts can produce royalty obligations under $0.01.

A model earning $100 with 8 generations of 5% decay reaches great-great-great-grandparents owed $0.039. The smart contract implements a dust threshold (minimum $0.10 payment) to avoid transaction costs exceeding payment amounts, with royalties below the threshold accumulating until the sum exceeds $0.10, then distributing in the next payment. This prevents gas costs from consuming micro-payments while ensuring all creators eventually receive owed amounts.

Contribution Weight Disputes

Merged models require self-reported contribution weights that could be gamed.

A creator claiming 99% contribution to a merge where the other parent contributed equally might face challenges. Evidence includes comparing model performance with each parent individually to measure relative improvement, examining weight distribution changes to see which parent dominated the resulting model, and reviewing published documentation about the merging process.

If challengers prove contribution weights are grossly inaccurate, the registration can be marked disputed, warning users and potential validators for derivative registrations.

6.4 Value Accrual Mechanisms

Demand Drivers

Token demand stems from three primary sources that create consistent buying pressure:

Registration Demand

Registration requires tokens for each model added to the registry.

At 10,000 registrations per year requiring 100 tokens each, demand reaches 1 million tokens annually. As adoption grows to 100,000 registrations (reaching 0.1% of HuggingFace's 500,000+ models), annual demand reaches 10 million tokens. This demand is inelastic: creators must register to participate regardless of token price, creating consistent buy pressure that scales with ecosystem growth.

Royalty Circulation

Models generating revenue must pay royalties in $ORIGYN.

A model earning $100,000 with 7.5% total royalty burden requires purchasing $7,500 worth of $ORIGYN for distribution. Across an ecosystem with $10 million in annual model revenue at average 8% royalty, $800,000 in token demand emerges. Unlike registration fees (one-time per model), royalty payments recur as long as models generate revenue, creating sustained demand that scales with ecosystem commercial success rather than just model count.

Staking and Premium Features

Validators locking 10,000 tokens minimum across 100 validators remove 1 million tokens from circulation.

Premium features locking 5,000 tokens for 1 year across 200 users remove another 1 million tokens. Governance participation may lock tokens in voting escrows for increased voting power (following Curve's veToken model), further reducing circulating supply. These locks don't create demand through purchases but remove supply from markets, with equivalent price impact to direct demand.

Supply Reduction

Token burns create permanent supply reduction that compounds over time:

Registration fees burn 70% of payments. 10,000 registrations at 100 tokens each burn 700,000 tokens annually. Failed challenges burn stakes: 100 challenges annually with 10% failure rate burn 10,000 tokens (100 × 0.1 × 1,000). Slashing incidents burn 50% of slashed amounts: 10 slashing events per year averaging Tier 2 (50% of 10,000 = 5,000) burn 25,000 total tokens.

Combined annual burns reach approximately 735,000 tokens in a mature year.

Staking and feature locks temporarily reduce circulating supply without permanently burning. 100 validators at 10,000 tokens each lock 1 million tokens. 200 premium feature users at 5,000 tokens each lock 1 million tokens. Governance participation might lock an additional 2 million tokens across engaged community members, bringing total locks to 4 million tokens (0.4% of total supply).

Supply reduction compounds over time with cumulative burns.

Year 1 burns 735,000 tokens. Year 2 with 50% adoption growth burns 1.1 million tokens. Year 3 burns 1.65 million tokens. By Year 5, cumulative burns could reach 5-10 million tokens (0.5-1% of total supply) assuming aggressive adoption. Combined with 4-8 million locked in staking and features, effective circulating supply decreases to 985-987 million tokens from the 1 billion initial supply, creating scarcity that supports price appreciation.

Net Effect on Token Price

Supply and demand dynamics create upward price pressure through multiple mechanisms:

Registration demand increases with adoption where 10,000 registrations require 1 million tokens purchased, creating buy pressure. If registration grows 10x to 100,000 annually, demand reaches 10 million tokens with proportionally larger market impact. Meanwhile, burns accumulate at 700,000 tokens annually at 10,000 registrations, scaling to 7 million at 100,000 registrations.

The net effect removes more tokens than non-burn demand requires, creating inherent scarcity.

Royalty circulation adds demand without burning. $10 million in annual model revenue at 8% average royalty drives $800,000 in token demand. If token price is $0.02, this requires 40 million tokens. If price rises to $0.10, only 8 million tokens are needed for the same dollar-denominated royalty payments.

Higher prices reduce required token quantity but maintain dollar-denominated demand, meaning price appreciation doesn't eliminate demand the way it might for optional purchases.

Staking yields compete with alternative investments across the DeFi landscape. At $0.02 token price, 10,000 token stake costs $200 and earns 8-12% APR ($16-$24 annually). As price rises to $0.10, stake costs $1,000 but earns $80-$120 annually, with the dollar-denominated return scaling with price and maintaining attractiveness relative to DeFi yields (8-15%) while far exceeding traditional savings (0.5-2%).

This price-invariant attractiveness means staking demand doesn't diminish as price appreciates.

Year 1 projections with 10,000 registrations: 1 million token demand (registrations), 735,000 token burn, 1 million token lock (staking), 1 million token lock (features). Net effect removes 2.735 million tokens from circulation through burns and locks while requiring 1 million tokens for registration, with buyers sourcing tokens from circulating supply and creating net removal of 2.735 million tokens.

As registration scales to 100,000 annually: 10 million demand, 7 million burn, plus royalty demand from growing commercial usage (assume 5 million tokens), plus unchanged locks (4 million). Total demand reaches 19 million tokens, burns reach 7 million, creating 26 million token impact on circulating supply representing 2.6% annual deflation comparable to Bitcoin's current issuance reduction rate.

Comparison to Other Token Models

Ocean Protocol ($OCEAN)

Ocean uses tokens for data marketplace payments, with dataset publishing and consumption driving demand.

The data token model creates many small pools rather than one unified liquidity pool, fragmenting liquidity. Origyn improves on this through singular token utility (no intermediate datatokens creating friction) and built-in burn mechanism (Ocean lacks systematic burns). Ocean's strength in data marketplace mechanics doesn't translate directly to model provenance, but the payment utility model validates $ORIGYN's royalty payment approach.

SingularityNET ($AGIX)

SingularityNET implements AI service marketplace payments with staking for platform discounts.

Services are permissionless, creating quality control challenges where low-quality services harm platform reputation. Origyn incorporates SingularityNET's payment utility concept but adds validator staking for quality assurance and royalty distribution for multi-party attribution. SingularityNET's service marketplace and Origyn's provenance registry serve different functions, but both demonstrate AI-focused token utility beyond speculation.

Render ($RNDR)

Render features burn mechanism on GPU rendering job completion, with node operator staking.

The burn-on-utility model directly inspired $ORIGYN's registration burn, demonstrating that utility-driven burns create value capture. Render's success (market cap >$1B at peaks) proves that utility-driven burns work at scale when genuine demand exists. Origyn extends this by combining burns with staking yields and royalty circulation, creating three demand drivers instead of Render's single burn mechanism.

Filecoin ($FIL)

Filecoin requires storage provider collateral with slashing for failed proofs.

Complex tokenomics with vesting schedules and block rewards creates continuous sell pressure that suppresses price despite genuine utility. Origyn simplifies through fixed supply (no mining inflation), straightforward utility (registration/royalty/staking), and transparent burns. Filecoin's collateral model validates $ORIGYN's validator staking, but Origyn's lower minimum stake (10,000 tokens vs. Filecoin's variable high requirements) improves accessibility.

The Graph ($GRT)

The Graph implements query fees paid to indexers, with curator staking on subgraphs.

Multi-sided marketplace (developers, indexers, curators) creates complex dynamics where all three parties must coordinate. Origyn simplifies to two-sided model (creators register, validators verify) with optional third side (delegators stake), reducing coordination complexity. The Graph's success with crypto-native developers demonstrates appetite for pay-per-use models in decentralized infrastructure, validating Origyn's targeting of similar users (AI developers) with adapted mechanics (provenance instead of indexing).

Common patterns across successful protocols: clear utility beyond speculation (payment for services creates genuine demand), stake requirements for service providers (aligning incentives through skin in the game), and fee redistribution to stakeholders (creating yield that attracts capital).

Origyn combines these patterns with unique burn mechanism (70% of registration fees) that exceeds most competitors' deflationary pressure.

Ocean and Graph lack systematic burns. Render burns but lacks staking yields for token holders. Filecoin has yield but dilutes through mining inflation that creates sell pressure. Origyn's combination of burns, yields, and fixed supply positions favorably if execution matches design and genuine adoption materializes at projected scale.