> For the complete documentation index, see [llms.txt](https://rwapact.gitbook.io/whitepaper/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://rwapact.gitbook.io/whitepaper/protocol-economics/token-utility.md).

# Token Utility

## Token Utility

The current Whitepaper v1.0 defines four RWAPACT token utility functions:

1. Governance
2. Staking
3. Fee sharing
4. Policy premium

This page describes only those defined utilities. It does not define token supply, allocations, emissions, yields, or other token economics.

| Utility        | Function                                               |
| -------------- | ------------------------------------------------------ |
| Governance     | Vote on risk parameter changes and asset allowlisting. |
| Staking        | Stake to become a risk oracle node.                    |
| Fee sharing    | Token holders share in protocol fees.                  |
| Policy premium | Higher tiers unlock advanced policy features.          |

### Governance

Token holders can participate in governance decisions related to protocol risk configuration. The current specification explicitly identifies risk parameter changes and asset allowlisting.

Risk parameters influence which RWA trades can pass the Pact. Asset allowlisting determines which assets can be recognized as permitted within the protocol's policy framework.

The current specification does not define voting quorum, proposal thresholds, delegation mechanics, voting duration, or DAO structure. Those governance details are outside the scope of this utility description.

### Staking

Token holders can stake tokens to become a risk oracle node. This utility connects participants to KRO, the layer responsible for assessing RWA-specific risk before execution.

Staking provides an economic role for participants that contribute to the risk oracle layer. The Whitepaper v1.0 does not define a minimum stake, slashing percentage, reward rate, validator count, hardware requirements, or delegation system.

### Fee sharing

Token holders share in protocol fees according to the protocol's economic design. The defined revenue streams include:

* The `0.3%` protocol fee on validated trade volume
* The `10%` share of gas savings from KGR optimization
* Enterprise Risk API subscriptions
* Per-query attestation lookup fees

The specification does not define the percentage of protocol revenue distributed to token holders. This page does not infer a distribution percentage from the fee-sharing utility.

### Policy premium

Higher token utility tiers can unlock advanced policy features. This utility connects to KPV, the Policy Vault, which manages configurable trading policies.

KPV policies can include allowed assets, maximum trade size, daily limit, maximum concentration, maximum slippage, a fresh oracle requirement, minimum liquidity, off-hours policy, and a risk score threshold.

The current model identifies higher tiers as a route to advanced policy features. It does not define tier names, prices, feature matrices, or token requirements.

### Utility Across the Protocol

```
Governance
  -> Protocol configuration

Staking
  -> Risk oracle participation

Fee sharing
  -> Protocol economics

Policy premium
  -> Advanced policy access
```

Each utility connects to a defined part of RWAPACT. Governance affects risk and asset configuration. Staking relates to the risk oracle layer. Fee sharing connects token holders to protocol-generated fees. Policy premium connects token utility to advanced policy capabilities.

### Utility Is Tied to Protocol Functions

The token's current utility is connected to the protocol architecture. It is not presented as an investment or a promise of financial returns.

These four functions are the current utilities defined by RWAPACT Whitepaper v1.0. Detailed governance parameters, staking economics, and policy tiers can be specified separately as the protocol design evolves.

***


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