A Two-Token Architecture
Enclaves separates asset tokens (ownership/value) from the utility token (accountability/security). Asset truth cannot depend on votes. This separation ensures the integrity of both systems.
Two Tokens, Two Purposes
The Enclaves protocol uses a deliberate two-token architecture to avoid circular trust dependencies and ensure each token serves its specific purpose without compromise.
ERC-1155 Ownership Instruments
Each asset maps to exactly one token ID with immutable supply constraints—enforced as single units or fixed fractional supply per asset identity. These are the ownership instruments that represent real-world assets.
- One token ID per real-world asset
- Immutable supply per token ID
- Single unit or fractional ownership
- Legally bound to SPV-held assets
- Transferable across secondary markets
Work, Stake, and Coordination
A work, stake, and coordination token required to operate, secure, and scale the Enclaves network. Value is derived from use, risk, and responsibility—not passive holding.
- Mandatory SPV staking
- Issuance capacity licensing
- Infrastructure payments
- Operator incentives
- Protocol governance
Why Two Tokens?
Separating asset tokens from the utility token avoids circular trust. If the token used for governance also represented asset value, a governance attack could compromise asset integrity. By keeping these functions separate, the system ensures that asset truth is always determined by law, process, and verification—never by votes or token-weighted influence.
Token Functions
The utility token powers every layer of the Enclaves network—from economic security to operational coordination.
Mandatory SPV Staking
Every Enclaves SPV must stake tokens to operate. The stake functions as a bond of economic accountability—creating real consequences for misconduct or negligence through slashing. Higher-value asset portfolios require proportionally larger stakes.
Issuance Capacity
Issuers lock tokens to gain issuance capacity. Token locks determine how much value can be tokenized, ensuring issuance is economically constrained and proportional to the issuer's commitment.
Infrastructure Payments
Tokens pay for protocol-level services: asset registration, verification, attestations, transfer synchronization, and compliance workflows. This creates sustainable demand tied to real usage.
Operator Incentives
Operators running verification services, monitoring agents, and process automation earn tokens for correct and timely performance. Rewards are proportional to operational contribution.
Protocol Governance
Token holders govern protocol-level parameters: staking thresholds, slashing rules, supported jurisdictions, and standards for new asset classes. Governance is limited to protocol parameters—never asset truth.
Token Distribution and Economics
The token allocation is designed to ensure long-term alignment between all network participants while funding development and incentivizing growth.
Token Allocation
Economic Design Principles
Value From Use, Not Speculation
Token value is derived from actual protocol usage—staking requirements, issuance capacity, service payments, and operational rewards. This creates sustainable demand tied to real economic activity.
Economic Accountability
Staking and slashing create direct economic consequences for poor performance or misconduct. Operators have skin in the game, aligning incentives with the security of the network.
Supply Constraints
Fixed total supply with predictable emission schedules. No inflationary mechanisms. As network usage grows, the proportion of tokens locked in staking and issuance capacity increases, naturally reducing circulating supply.
Vesting Alignment
Team, advisor, and early backer tokens are subject to multi-year vesting with cliff periods. This ensures long-term alignment and prevents early sell pressure.
What Drives Token Demand
Every major function of the Enclaves network requires the utility token, creating organic demand tied to real usage.
SPV Operations
Every active SPV must maintain a token stake. As more SPVs are created to manage growing asset portfolios, staking demand increases proportionally.
Asset Issuance
Every new asset tokenization requires issuance capacity, which is obtained by locking tokens. Growth in tokenized assets directly increases token demand.
Service Fees
Verification, attestation, compliance, and transfer services are paid in tokens. Higher transaction volumes generate sustained token demand.
Network Growth
As the network scales to more jurisdictions, asset classes, and participants, the aggregate demand for staking, capacity, and services compounds.
Explore the Full Token Design
Read the Enclaves Whitepaper for complete details on token architecture, economic models, and governance frameworks.