Tokenomics
TESS is the governance and utility token for the Tesseract protocol. It powers three things, all enforced by Vyper contracts on each supported rollup: on-chain governance, staking with fee discounts, and the bond that lets relayers coordinate cross-chain resolution.
TESS holders vote on protocol upgrades, parameter changes, and treasury allocations through TesseractGovernor. Voting power is TESS-weighted and resolution happens entirely on-chain — no off-chain Snapshot signalling, no foundation override.
Stakers receive up to a 50% discount on protocol swap fees. The discount tier is a function of stake size and lock duration, so the people most aligned with the protocol’s longevity pay the lowest fees.
Relayer operators must bond TESS in the RelayerRegistry to coordinate cross-chain resolution. Bonded relayers earn a share of swap fees for legitimate work; misbehaviour is economically expensive because their bond is on the line.
Staking
Staking happens in TesseractStaking.vy. Rewards are funded by protocol swap fees that flow through the on-chain FeeCollector — not by inflation, and not by a foundation budget. The longer you lock, the larger your share of fees and the deeper your discount on your own swaps.
| Lock | Reward range | Notes |
|---|---|---|
| Flexible / short lock | ~5% APY | Unstake anytime. Lowest yield, maximum optionality. |
| Medium lock | 5–10% APY | Locked through a meaningful number of governance cycles. |
| Long lock | Up to 15% APY | Maximum yield, maximum alignment, deepest fee discount. |
Reward ranges per the open-source README. Final tier curve and any cliff/vesting parameters are set on-chain in TesseractStaking at deployment and changeable only by governance.
Fee flow
Tesseract has one fee path and it is fully on-chain. Every swap routes a small protocol fee to FeeCollector.vy. From there fees are split between TESS stakers and the relayer that coordinated the swap. There is no off-chain treasury, no manual sweep, and no foundation wallet in the middle.
A swap (or a leg of an atomic group) executes through TesseractBuffer and AtomicSwapCoordinator.
Protocol fee accrues in FeeCollector, on-chain, denominated in the swap asset.
A portion routes to TesseractStaking and is claimable by TESS stakers pro rata.
A portion goes to the bonded relayer that coordinated this swap through RelayerRegistry.
Governance
Governance lives in TesseractGovernor.vy. TESS holders propose parameter changes, vote with TESS-weighted ballots, and the contract itself executes accepted proposals. The chain is the source of truth; there is no separate signalling layer and no admin key that can override the result.
Token-related contracts
The TESS layer is intentionally small. Five contracts cover the entire token surface, all in Vyper for built-in overflow protection and a deliberately constrained language footprint.
| Contract | Approx. size | Purpose |
|---|---|---|
| TesseractToken.vy | 4,521 bytes | TESS ERC-20 governance token. |
| TesseractStaking.vy | 6,890 bytes | Tiered staking, fee-discount accounting, reward distribution. |
| FeeCollector.vy | 3,245 bytes | On-chain collection and distribution of protocol fees. |
| RelayerRegistry.vy | 4,112 bytes | Relayer bonding, registration, slashing surface. |
| TesseractGovernor.vy | 5,678 bytes | On-chain governance: proposals, voting, execution. |
The token-related contracts compile and pass the 21 tokenomics tests inside the open-source 135-test suite. The TESS token is not live on a public mainnet at the time of writing. Exact circulating supply, distribution schedule, and any vesting cliffs are governance-set parameters that will be finalised on-chain at mainnet launch and announced in the GitHub release. We do not publish numbers we have not committed to in code.