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  1. Overview
  2. Governance & the MENTO Token

MENTO Tokenomics

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Last updated 24 days ago

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  • Token Overview
  • Token Distribution
  • Community Treasury (45% - 450M tokens)
  • Team & Contributors (30% - 300M tokens)
  • Community Airdrops (10% - 100M tokens)
  • Reserve Safety Fund (5% - 50M tokens)
  • Future Team & Advisors (10% - 100M tokens)
  • Value Accrual Mechanisms
  • Protocol Revenue Sources
  • Revenue Distribution
  • veMENTO: Vote-Escrowed Governance
  • Emission Schedule
  • Utility and Demand Drivers
  • Economic Security
  • Future Considerations
  • Next Steps

The MENTO token serves as the governance and value accrual mechanism for the Mento Protocol. Through carefully designed tokenomics, MENTO aligns the interests of token holders, users, and the protocol's long-term sustainability.

Token Overview

Token Type: ERC-20 governance token

Total Supply: 1,000,000,000 (1 billion) MENTO

Initial Status: Non-transferable (governance only)

Transferability: Subject to governance approval

MENTO launched as a non-transferable governance token, allowing holders to participate in protocol decisions while preventing speculative trading during the early stages. The community will decide when to enable transfers through an on-chain vote.

Token Distribution

The initial allocation balances community ownership with sustainable development:

Community Treasury (45% - 450M tokens)

The largest allocation goes to the Mento Community Treasury, ensuring resources for:

  • Protocol development and maintenance

  • Liquidity incentives and ecosystem growth

  • Grants and community initiatives

  • Long-term sustainability

Emission Schedule: 50M available at genesis, remainder emitted via exponential decay with 10-year half-life. This creates predictable, decreasing emissions that prevent sudden supply shocks.

Team & Contributors (30% - 300M tokens)

Allocated to Mento Labs team, contributors, supporters, and advisors:

  • 25% as veMENTO: 1-year locked voting power for immediate governance participation

  • 75% as MENTO: 1-year cliff followed by 3-year linear vesting

This structure ensures core contributors remain aligned with long-term protocol success.

Community Airdrops (10% - 100M tokens)

CELO Holders & Mento Users (5% - 50M): Rewards early adopters and active users

  • Distributed as 2-year locked veMENTO with linear unlock

  • Recognizes historical contributions to the ecosystem

Celo Community Treasury (5% - 50M): Strengthens cross-ecosystem alignment

  • 2-year delay followed by 6-year linear vesting

  • Fosters continued collaboration between protocols

Reserve Safety Fund (5% - 50M tokens)

Emergency collateral backing for extreme scenarios:

  • Acts as last-resort protection for stablecoin holders

  • Can be deployed if primary collateral suffers losses

  • Provides additional confidence in system stability

Future Team & Advisors (10% - 100M tokens)

Reserved for attracting top talent:

  • Enables competitive compensation packages

  • Supports long-term team growth

  • Maintains ability to bring in expert advisors

Value Accrual Mechanisms

MENTO captures value from protocol operations through multiple streams:

Protocol Revenue Sources

  1. Trading Fees: Collected on every swap through the protocol

  2. Reserve Yield: Returns from deployed reserve assets

  3. CDP Interest(V3): Interest paid by synthetic stablecoin borrowers

  4. Flash-swap Fees(V3): Premiums from inventory rebalancing operations

Revenue Distribution

Governance controls how protocol revenue flows:

  • veMENTO Stakers: Receive portion of fees based on lock duration

  • Stability Pools: Share of revenue for providing liquidation backstop

  • Buyback & Burn: Potential mechanism to reduce supply

  • Treasury Growth: Funding ongoing operations

The exact distribution is governable, allowing the community to optimize for growth, sustainability, or value return as needed.

veMENTO: Vote-Escrowed Governance

Following the successful Curve model, MENTO can be locked for veMENTO to gain:

Voting Power: Longer locks (up to 4 years) receive proportionally more voting weight, encouraging long-term thinking.

Revenue Sharing: veMENTO holders receive protocol revenues, with distributions weighted by lock duration.

Governance Rights: Participate in all protocol decisions including parameter changes, asset listings, and treasury management.

The vote-escrow model creates strong alignment—those with the most influence have the longest commitment to the protocol's success.

Emission Schedule

MENTO follows a controlled emission model:

  1. Genesis: Initial distribution to allocated recipients

  2. Treasury Emissions: Exponential decay with 10-year half-life

  3. Liquidity Incentives: Governance-controlled rewards for strategic pools

  4. Long-term Cap: Hard cap at 1 billion tokens ensures no inflation

This schedule provides flexibility for growth while maintaining predictable supply dynamics.

Utility and Demand Drivers

MENTO derives utility from several core functions:

Governance Power: Control over a growing multi-chain stablecoin ecosystem

Revenue Rights: Direct claim on protocol income streams

Liquidity Incentives: Rewards for providing essential liquidity

Safety Backstop: Reserve fund creates additional stability demand

As Mento expands across chains and use cases, these utilities create natural demand for MENTO tokens.

Economic Security

The tokenomics include several protective mechanisms:

  • Delayed Transferability: Prevents early speculation and dumping

  • Vesting Schedules: Large allocations unlock gradually

  • Governance Timelock: Changes execute after delay period

  • Watchdog Oversight: Additional safety during early stages

These features ensure orderly market development when transfers eventually enable.

Future Considerations

The MENTO tokenomics can evolve through governance:

  • Cross-chain Expansion: Deploy MENTO on multiple networks

  • New Revenue Streams: Add income from additional products

  • Enhanced Staking: Develop more sophisticated reward mechanisms

  • Partnership Tokens: Strategic allocations for ecosystem growth

The community will guide these developments based on protocol needs and market conditions.

Next Steps

To participate in the MENTO ecosystem:

  • Understanding Mento Governance - Learn how governance works

  • Participating in Governance - Start voting and proposing

  • Governance Forum - Join the community discussion