Canton Strategic Holdings executives used the company’s first quarterly “Canton Network Ecosystem Update” webinar to highlight first-quarter network growth and to explain the tokenomics framework underlying the Canton Network, including recent governance changes and the network’s burn-and-mint design.
Q1 ecosystem milestones and institutional activity
Mark Wendland, chairman and CEO of Canton Strategic Holdings, said the webinar was intended as a recap of the company’s quarterly report and a deeper dive into Canton’s tokenomics, followed by Q&A. Wendland introduced Mark Toomey, president of Canton Strategic Holdings, and Hannah Burgess, head of business development, as key contributors to the report.
Toomey said his conversations with institutional market participants suggest awareness of Canton has risen meaningfully in recent months. He pointed to ecosystem breadth and “increasing institutional adoption” in Q1, including “six new Super Validators approved,” bringing the total to 55. Toomey described the approval process as “onerous” and said each Super Validator makes specific commitments to the network.
Toomey also cited new initiatives announced in Q1 by “JPMorgan, Lloyds, Bank of New York, and London Stock Exchange Group,” which he said are “all going to be working on tokenized deposits.”
On network activity, Toomey highlighted transaction growth metrics he described as “staggering,” including:
- $9 trillion of monthly transaction volume
- $81.2 million of total transactions, a 32% increase versus last quarter
- 902,000 average daily transactions
- 10.44 average transactions per second, a 35% increase versus last quarter
He added that the network saw “milestone transactions across multiple currencies and asset classes” in Q1, including European government bonds, U.S. Treasuries, Gilts, euro cash, and U.S. dollar cash.
Protocol changes: issuance cut, app reward shift, and new locking mechanics
Burgess said Q1 included “major developments that enhanced the ways in which users interact on Canton,” citing Fireblocks and BitGo adding “institutional settlement rails” and Circle bringing “USDCx” to the network. She also said Super Validators such as LayerZero, Zonoff, and ChainSafe improved interoperability “without compromising its core values of privacy and compliance.”
On token incentives, Burgess said January brought a reward schedule change that “cut issuance in half from $5 billion per quarter to $2.5 billion per quarter,” and that the reward pool distribution changed so “apps now take home 62% of the reward pool.” She said approval of “CIP-104” aligned app rewards with “actual traffic driven on the network.”
She added that “CIP-100” created a Protocol Development Fund that allocates “5% of network rewards” for ecosystem development through milestone-based grants and public reporting. Burgess said “CIP-105,” slated to go live “tomorrow,” introduces on-chain locking for Super Validators requiring them to lock a percentage of earned rewards to demonstrate long-term commitment and maintain full governance weight.
Wendland said he was watching the rollout and impact of CIP-105, noting the lock requirement could affect “rather large numbers of the total float of Canton Coin outstanding.” He also highlighted a separate near-term focus: DTCC’s DTC pilot work tokenizing U.S. Treasuries, which he said he hoped would be ready for launch in a “June-July timeframe.”
Tokenomics deep dive: burn/mint mechanics and fee predictability
The tokenomics discussion featured Eric Czarnecki, co-founder of Digital Asset, and Chris Zuehlke, a DRW partner and chair of the Tokenomics Committee. Czarnecki said Digital Asset built Canton “step-by-step, customer by customer,” and that the “real catalyst” for launching a network was when customers in production began asking “how to connect their use cases together.”
Czarnecki said the tokenomics model was designed to address trade-offs observed in other networks, with goals including creating “first-mover advantages for participation,” distributing rewards to “those doing something productive,” and aligning incentives so that applications—rather than only infrastructure—participate in network economics. He also said the design aimed to give the token “some fundamentals to the price,” enabling analysis more akin to cash-flow expectations tied to network utility rather than “meme coin” heuristics.
Zuehlke explained minting as the creation of Canton Coin after participants perform work on the network. He said rewards flow to Super Validators for securing and synchronizing transactions, and also to application operators and certain validators based on activity and fees. Burning, he said, destroys tokens to generate “dollar-denominated bandwidth credits,” which are used to pay for transactions. He emphasized that users can participate “without ever holding Canton Coin,” because they can obtain bandwidth indirectly via third parties.
He described “burn mint equilibrium” as the dynamic between activity-driven burns and minting rewards, with the conversion price between Canton Coin and bandwidth influencing whether the system trends more inflationary or deflationary over time. He distinguished between “application BME” and “network-wide BME,” noting that super validator emissions are a separate component of the overall emission schedule.
Czarnecki added that Canton’s fee structure is designed for predictability: “all the fees are denominated in dollars,” meaning two transactions of the same size cost the same in dollar terms regardless of the token price. He said the burn mechanism functions like a “built-in buyer on the downside” and compared it conceptually to a “buyback structure,” though he stressed it is automated through network activity. He also said “burn” should be viewed as a key “top-line metric” for assessing the ecosystem, while cautioning that durability of activity matters.
Issuance schedule and governance thresholds
Zuehlke outlined an issuance schedule described in the network’s white paper, including time-based tranches with annualized issuance rates moving from 40 billion per year early on, to 20 billion per year, to 10 billion per year in the current period, and a “terminal state” of 2.5 billion per year after 10 years. He also detailed changes in reward splits after the recent halving, saying the allocation shifted from a prior regime of 40% for applications, 12% for validators, and 48% for Super Validators to a new regime of 62% for applications, 18% for validators, and 20% for Super Validators. In the terminal state, he said, the distribution would shift further to 75% for applications, 20% for validators, and 5% for Super Validators.
He said changes to issuance or allocation ratios would require a formal governance proposal—called a CIP—accepted by the Tokenomics Committee and then approved by a vote requiring “nine of the operating Super Validators to vote in favor of it out of 13.”
Q&A: adoption drivers, concentration questions, and featured apps
In Q&A, Wendland addressed a question about how DTCC-led Treasury tokenization might affect burn, noting DTC has “around $30 trillion of U.S. Treasuries” and describing an expected initial rollout around late Q2 or early Q3, with scaling dependent on customer demand. Czarnecki said there is “really, really strong demand” for tokenized Treasury access and predicted increased collateral velocity, but he cautioned against making forward statements about burn because it depends on both adoption and token price.
Asked about concentration of Canton Coin holdings, Wendland said he was not concerned, pointing to the network’s early stage and expected diversification over time, and he cited Super Validator locking as an additional alignment mechanism. Czarnecki added that tokens “have been liquid from the very beginning” and said locking proposals are intended to demonstrate commitment, arguing that early participants have largely behaved as long-term holders.
On application incentives, Zuehlke said applications do not need to be “featured apps” to earn rewards, but featured status increases the reward rate via a multiplier. He said featured designation is granted through a Tokenomics Committee process with a “2/3 majority vote,” and he noted the pipeline of featured app requests is growing.
Wendland closed by emphasizing Canton’s “network of networks” vision, arguing that interoperability across participants is the core advantage, and said the focus is now on execution to enable tokenized assets—such as Treasuries—to move as collateral across tokenized deposits, exchanges, and clearinghouses.
Editor’s note: The transcript provided references Canton Strategic Holdings and the Canton Network; it does not include remarks about Tharimmune NASDAQ: THAR.
About Tharimmune NASDAQ: THAR
Tharimmune, Inc, a clinical-stage biotechnology company, engages in the development of therapeutic candidates for rare, inflammatory, and oncologic diseases. The company's pre-clinical immuno-oncology pipeline includes TH104, a product candidate for the treatment of liver-related and other pruritogenic inflammatory conditions; TH3215 and TH0059 that are product candidates used to treat various solid tumors; and TH1940, which targets programmed cell death protein 1 (PD-1). It has a research collaboration and product license agreement with Minotaur Therapeutics, Inc for the development of proprietary targeted biologics; and Washington University in St.
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