TESS, designed restrictively.
TESS is the Tessera Protocol token. Fixed supply, no admin levers, designed to do as little as possible beyond enabling the protocol to function. The constraints are the point.
Allocation
1,000,000,000 TESS, minted in full at contract deployment. The foundation receives the initial mint and distributes per the schedule below into vesting contracts.
Initial circulating supply at TGE: approximately 12.5% of total. Everything else is in vesting contracts, locked, or under foundation custody.
Utility
TESS exists to make the protocol function. Every utility function is designed against the question: "would this still make sense if TESS had no secondary market?"
Juror staking (MMAN v2)
Jurors stake TESS to participate in resolution disputes. Juror compensation is paid in USDC fees from the protocol — not in TESS yield. Stake is slashable on adversarial behavior.
Market creation bonds
Creating a market requires a TESS bond, refundable on successful resolution. Bond size set by governance. Discourages spam markets without making market creation prohibitive.
LP fee rebates
LPs holding TESS earn rebates on their LP fee income. Structured as tiered discounts, not pro-rata yield. Aligns LPs with the protocol's growth.
Governance
TESS holders vote on protocol parameters (fee tiers, juror minimums, supported markets). Non-binding in Phase 1; transitions to binding governance over Phases 2-3.
What TESS will not do
Explicit constraints. Each "will not" closes off a feature that would push TESS more clearly into security territory or otherwise compromise the foundation's posture.
- Receive any share of protocol revenue. Revenue accrues to LPs, jurors, and the foundation treasury.
- Be redeemable, convertible, or buy-back-able by the foundation.
- Earn "staking yield" denominated in TESS. No token-emission-based yield.
- Confer ownership in the foundation or any other entity.
- Make the holder a creditor of the foundation.
- Be marketed, sold, or distributed to U.S. persons by the foundation.
- Have a pause, mint, blacklist, or upgrade function in the contract.
- Be controlled by anyone after deployment — not the founder, not the board, not a multisig.
Jurisdictional scope
TESS is issued by Tessera Foundation, a Cayman Islands foundation company (in formation). The foundation does not offer, sell, or distribute TESS to U.S. persons as defined under Regulation S, Rule 902(k). The foundation does not sell to persons in jurisdictions subject to comprehensive U.S. sanctions.
Secondary market trading on decentralized exchanges may make TESS technically available globally. The foundation has no control over secondary market activity beyond its own conduct.
Maximum sell pressure
The largest single supply unlock is at month 12, when the private SAFT and founder cliffs end. Approximately 9-12 million TESS per month begin releasing at that point. At the initial DEX price target, this represents the upper bound of monthly potential sell pressure. Actual sell-side depends on recipient behavior — most vested allocations historically remain held.
For the month-by-month unlock schedule, see the simulator output published with the tokenomics document.
Inflation
TESS is non-inflationary. Total supply is fixed at 1B tokens at deployment. There is no mint function. The 15% LP incentive bucket is a pre-minted allocation released against a programmatic schedule; when exhausted (year ~4-5), no new TESS is created.
Comparable protocols
For reference, the founder allocation (18%) sits in the middle of comparable protocol ranges: Uniswap 21.5%, Optimism 19%, Arbitrum 26.9%, Aptos 19%, Aave 23%. The 15% public sale is high by recent comparison (most major launches in 2023-2025 favored airdrops); the rationale is funding the foundation's operational runway without raising venture capital in exchange for equity.
What this document doesn't cover
This is a public-facing summary. The full tokenomics document includes detailed reasoning behind each design choice, sensitivities to different scenarios, and the open decisions still being resolved with counsel. That document is shared with prospective SAFT investors under confidentiality.