Context

TANIP-1 was launched to operationalize user ownership at the application layer. It activated the Stakers miner group, implemented transparent issuance logic, and allowed participants to earn TEL through their own on chain activity and the activity of their referees.

The findings report highlighted key behaviors:

• Fees rose until they matched issuance levels • Fees dropped immediately when issuance paused • Weekly active wallet counts remained mostly unchanged • New wallets followed a churn pattern rather than cumulative growth • Referral flows often became self-referential

These patterns show that the system worked mechanically, but the economic incentives encouraged fee rotation instead of organic use.

A rebate model preserves the positive aspects of TANIP-1 while aligning incentives more closely with genuine behaviour.

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Proposal: Trading Fee Rebate Program

This proposal aims to replace issuance-based rewards with a capped rebate system that uses the same TANIP-1 architecture and logic but limits rewards to the amount of TEL each wallet actually paid in fees during each period.

Program Structure

The following elements remain unchanged:

• Stake requirement through the StakingModule • Referral tree logic • On chain fee verification through aggregator-to-AmirX transfers • Deterministic off chain calculation • Weekly batched uploads to TANIssuanceHistory • Network-agnostic design that future developers can adopt

The only modification is the introduction of a rebate cap.

Rebate Formula

R = calculated issuance from own and referee fees (following same calculation as original TANIP1 implementation) F = total TEL fees paid by the wallet during the period Final rebate = min(R, F)

Meaning:

If the calculated rebate exceeds the wallet’s fee spending, the wallet receives back the amount it paid in fees.

If the calculated rebate is lower than the wallet’s fee spending, the wallet receives the full rebate.

This ensures no participant can earn more TEL than they spend, removing the main driver of mercenary volume.

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Governance, Funding and Transparency

The rebate program will be:

• Funded by the existing TAN Council Safe • Distributed weekly through a newly deployed TANIssuanceHistory contract • Transparent, auditable, and consistent with past processes • Fully controlled by the TAN Council with no reliance on app updates

This structure makes the program predictable for users and developers while safeguarding treasury resources.

Next Steps

If approved, the Council will:

• Engage the TAO to make the required changes to the TANIP1 rewards calculation script • Activate the rebate program • Maintain weekly reward uploads • Track participation trends under the new model • Review program performance as TAN scales • Evaluate the potential return to the original issuance model once network maturity increases