Tokenomics

AXIO's economic model is designed around three tokens that serve distinct roles within the X1/Tachyon ecosystem. MEV revenue captured by the block engine flows through an on-chain fee distribution system that rewards validators, stakers, and the protocol treasury — with the majority of staker yield delivered through a reserve injection mechanism rather than direct token transfers.

Token Architecture

XNT

XNT is the native token of the X1/Tachyon blockchain — equivalent to SOL on Solana. It is used for gas fees, validator staking, and as the base denomination for all on-chain operations. MEV tips are paid in XNT.

aXNT (Liquid Staking Token)

aXNT is the liquid staking derivative of XNT. Users deposit XNT into the AXIO stake pool and receive aXNT in return at the current exchange rate. As MEV revenue is injected into the reserve vault, the exchange rate increases — meaning each aXNT becomes redeemable for more XNT over time.

Mint: GhQHapUR1V2Lh2rxQnpxeXVAvUMwXkm1DNbGaC6xM2WZ

aXNT is a non-rebasing token: the supply does not change to reflect yield. Instead, the exchange rate against XNT increases. This makes aXNT significantly more composable in DeFi than rebasing alternatives.

AXIO (Governance Token)

AXIO is the protocol governance token with a fixed maximum supply of 1 billion tokens, issued under the Token-2022 standard. It grants holders voting power over protocol parameters and, in future phases, a share of MEV revenue.

Fee Distribution

All MEV revenue collected by the AXIO block engine is denominated in XNT and distributed according to a fixed fee split:

Total MEV Revenue (100%)
  |
  |--- 40% --> Validator (direct tip to leader)
  |--- 25% --> Reserve Injection (aXNT appreciation)
  |--- 15% --> Staker Yield (swept to reserve vault)
  |--- 20% --> Treasury (protocol fund)

Combined, 40% of all MEV revenue flows into the stake pool reserve vault (25% reserve injection + 15% staker yield), directly increasing the value of every aXNT in circulation.

Reserve Injection Mechanism

The reserve injection mechanism is the core economic primitive that makes aXNT a yield-bearing asset. Understanding how it works — and why this approach was chosen over alternatives — is essential.

How It Works

The AXIO stake pool maintains a reserve vault holding XNT. The exchange rate between aXNT and XNT is determined by a simple formula:

exchange_rate = total_lamports_in_reserve / pool_token_supply

When XNT is deposited into the reserve vault (without minting new aXNT), the numerator increases while the denominator stays constant. This raises the exchange rate, meaning each existing aXNT is now redeemable for more XNT.

Example:

Before injection:
  Reserve:          1,000,000 XNT
  aXNT supply:      900,000 aXNT
  Exchange rate:    1.1111 XNT per aXNT

MEV revenue injection: 10,000 XNT deposited to reserve

After injection:
  Reserve:          1,010,000 XNT
  aXNT supply:      900,000 aXNT  (unchanged)
  Exchange rate:    1.1222 XNT per aXNT  (+1.0%)

Every aXNT holder benefits proportionally without any transaction, claim, or rebalance.

Why Not Buy-and-Burn?

Reserve injection is not a buy-and-burn mechanism. It is mathematically equivalent in outcome — each token becomes worth more — but eliminates several categories of risk:

Alternatives Evaluated and Rejected

During the design phase, three alternative mechanisms were evaluated:

SPL Token Burn: Burning aXNT tokens from a protocol-held balance. Rejected because spl_token::burn destroys tokens but does not update pool_token_supply in the stake pool state. The exchange rate formula would produce incorrect results, as the denominator would not reflect the actual circulating supply.

Sync Supply Instruction: Adding a custom instruction to synchronize the pool's recorded supply with the actual token supply. Rejected because it introduces a manipulation attack vector — any party that can burn aXNT tokens outside the pool could trigger a supply sync to artificially inflate the exchange rate.

Circular Withdraw: Withdrawing XNT from the pool and re-depositing it. Rejected because it produces no net effect on the exchange rate (withdrawal reduces both numerator and denominator proportionally) and wastes compute units.

Industry Standard

Reserve injection is the established pattern used by every major liquid staking protocol:

• Jito (JitoSOL): MEV rewards deposited into stake pool reserve, increasing JitoSOL exchange rate
• Marinade (mSOL): Validator rewards flow into reserve, appreciating mSOL
• Lido (stETH): Beacon chain rewards increase the backing ratio of stETH

AXIO follows this proven approach adapted for MEV revenue on X1/Tachyon.

Cranks

Cranks are automated on-chain operations that execute the fee distribution logic. All cranks use randomized timing intervals to prevent frontrunning and MEV extraction on the distribution transactions themselves.

Why Randomized Timing?

If cranks fired on a predictable schedule, sophisticated actors could:

1. Front-run the reserve injection by buying aXNT immediately before the deposit, then selling after the exchange rate increases
2. Sandwich the tip distribution by positioning around the validator's tip receipt
3. Time arbitrage trades to coincide with known yield events

Randomization within each interval window eliminates timing predictability while maintaining consistent throughput. The crank operator cannot predict the exact execution second, and neither can external observers.

On-Chain Programs

All AXIO tokenomics are enforced by on-chain programs deployed on X1/Tachyon:

All program upgrade authorities are held under multisig control. Fee split percentages are encoded as program constants — changing them requires a program upgrade approved by governance.

AXIO Governance Token

The AXIO token is the governance layer of the protocol, separate from the yield-bearing aXNT.

Governance Scope

AXIO holders will govern:

• Fee split ratios — adjusting the 40/25/20/15 distribution
• Crank timing parameters — minimum and maximum intervals
• Validator eligibility — requirements for block engine participation
• Treasury allocation — how the 20% treasury fund is deployed
• Protocol upgrades — approval of program upgrades via multisig

Revenue Share (Future)

A future protocol upgrade will allocate 5% of MEV revenue to AXIO stakers, creating a direct economic incentive for governance participation. This share will be sourced from the treasury allocation, reducing it from 20% to 15%.

DeFi Composability

aXNT is designed to be a first-class DeFi primitive on X1/Tachyon.

Collateral in Lending Protocols

Because aXNT has a deterministic, monotonically increasing exchange rate against XNT, it is an ideal collateral asset for lending protocols. Liquidation risk is lower than volatile assets, and the yield accrues to the borrower even while the position is collateralized.

Instant Unstaking via AMM

The forti-amm program maintains an aXNT/XNT liquidity pool that enables instant unstaking without waiting for the stake pool's cooldown period. Arbitrageurs keep the AMM price aligned with the stake pool exchange rate, providing efficient price discovery.

Non-Rebasing Advantage

aXNT uses an exchange rate model rather than a rebasing model. The token supply remains stable — only the redemption rate changes. This is critical for DeFi composability:

Protocols that integrate aXNT do not need custom accounting logic — it behaves like any standard SPL token, with yield captured entirely in the exchange rate.