$LITKEY Tokenomics

The Lit Association is delighted to be launching the network token for Lit Protocol, LITKEY.

The LITKEY token launch is taking place on Aerodrome on Base on October 30th 00:00 UTC, followed by coordinated CEX listings on November 6th. See the announcement post to learn more about how to participate.

After five years of development and over a year of mainnet operation, Lit has become a critical network for decentralized, programmable signing and encryption. The Lit v0 network, launched in October 2024, powers a vibrant ecosystem of apps with $422M under decentralized management and signing growing at a rate of 45%/month. The network serves as vital infrastructure for hundreds of applications representing millions of accounts.

Dive into the ecosystem:

• Explore the teams building on Lit today
• Watch conversations with ecosystem founders using Lit in production
• Read to the Executive Summary
• Learn about Lit Protocol
• Track Lit V0 usage on Dune

With LITKEY, the network transitions into its next phase, the first in a sequence of milestones that expand decentralization and align incentives across the ecosystem:

1. Token Launch to establish a transparent, community-driven network economy and elect node operators.
2. Lit V1 DKG, the distributed key generation conducted by nodes selected via token holder governance.
3. veLITKEY Model: token holder directed emissions for productive ecosystem teams

Together, these steps complete the foundation for an open, self-sustaining decentralized key management mesh. 

LITKEY Utility

• Power network economy: Use LITKEY for signing, encryption, and compute requests on Lit, performance on Vincent, and setting up new realms.
• Stake for liveness: Node operators stake LITKEY to participate, strengthening network reliability on top of defense in depth layers of secure cryptography.
• Govern with veLITKEY: Lock LITKEY to secure the network and gain voting power over emissions.
• Reward usage: Apps that drive demand create usage-weighted incentives that power the veLITKEY methodology.

Details

Distribution

Lit Protocol Airdrop

10% of the LITKEY supply is reserved for the Lit Protocol Airdrop and other TGE-related activities. Beginning at TGE, these tokens will be distributed to builders, node operators, and other ecosystem participants.

Lit Association

11% of the LITKEY supply is reserved for the Lit Association. These tokens will be used to fund ongoing operations, ecosystem growth initiatives, and the progressive decentralization of the network.

Aerodrome Incentives

4% of the LITKEY supply is reserved for voter incentives on Aerodrome. 1% of total tokens is reserved for the first LITKEY/WETH epoch with voting now live.

veLITKEY Builder Reward Pool

28% of total LITKEY tokens are reserved for builder incentives. These emissions will be directed by veLITKEY holders. Details here. 

Founding Contributors

28% of the LITKEY supply is reserved for founding contributors who have dedicated five years to creating Lit Protocol. Their contributions span product, engineering, business development, ecosystem, marketing, and strategy.

Early Investors + Community Sale

19% of LITKEY is reserved for early investors of Workgraph, Inc who have provided financial and strategic support for many years as well as participants in the $LITKEY Community sale on Legion.

Vesting Schedule

All team and venture investor tokens are locked for 1 year after TGE with 24 month linear vesting thereafter.

Investor tokens also include the Legion Community Sale, with the following distribution:

• 0.17% total token liquid at token launch
• 0.14% with 12 months linear vesting
• 0.51% locked for 1 year.

The veLITKEY pool for builder reward emissions are variable and tied directly to network revenue.

Secure Autonomy for the Internet

Lit Protocol is a foundational computing service rebuilt as a public system that is already generating value and solving problems others haven’t. Now, with LITKEY, everyone can add their influence on the future of digital authority.

Build with Lit
Community Launch Announcement
Governance Documentation
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Disclaimer: Some functions described for the project and LITKEY (e.g., governance, rewards, fees) are forward-looking and subject to change, may be delayed, or may never be released. Nothing herein is a promise or guarantee to deliver any feature. LITKEY is intended to provide access to and coordination within the network; it does not represent equity, ownership, or a right to revenue, assets, dividends, or profits. No expectation of profit should be formed from this post, and you should be aware that network participation involves risk, including loss of funds, volatility, exploits, and regulatory shifts. Statements speak only as of the publication date, we undertake no duty to update them, and availability/eligibility may vary by jurisdiction. This post is informational and not an offer or solicitation to buy or sell any token, securities, or any other instruments, and is not investment, legal, or tax advice.