---
title: "The Founder's Cut"
url: "https://caper.network/blog/the-founders-cut"
updated: 2026-10-01
last_verified: 2026-10-01
license: CC-BY-4.0
license_url: "https://creativecommons.org/licenses/by/4.0/"
---

# The Founder's Cut

> **[May be outdated]** Since the redeploy of 25 September 2026 the skim this essay calls the founder's cut is shared, and there is no trade fee: the founder takes half of it, the traded caper's own treasury nearly all the rest, in XRD, and the Commons a sliver of the tokens. Since the logic upgrade of 30 September 2026 each trade pays one rate, read where a buy starts or where a sale would bottom out, rather than the rate at each token's own point on the curve. The essay was revised on 1 October 2026 to match. The argument, that a founder is paid out of what traders move, at a rate that falls with circulation, and never out of a premine, is unchanged. Current figures: /wiki/foundations/what-a-founder-can-take.

For most of history, whoever struck the coins took a cut. The word for it is [seigniorage](https://en.wikipedia.org/wiki/Seigniorage), from _seigneur_, the lord: the gap between what a coin is worth and what it costs to make, kept by the authority that makes it. A lord who ran a mint earned on every coin struck – a fee for turning raw silver into money the realm could actually use. Honest enough, in principle. Minting is a service, and the minter is paid for performing it.

The abuse that shadows seigniorage is debasement. A ruler short of money could mix cheap metal into the coin, strike the same face value out of less silver, and pocket the shortfall. Henry VIII [debased the English coinage](https://en.wikipedia.org/wiki/Great_Debasement) so thoroughly that he earned the name "Old Coppernose," the silver wearing off the high point of his portrait to show the base metal beneath. Debasement is seigniorage's evil twin. Instead of charging a visible fee to the person buying new money, the minter takes a little from everyone already holding it. The first is a price. The second is a theft wearing the costume of a price.

Every enterprise that issues a claim on itself faces a version of this choice, because someone has to be paid for building the thing. A startup pays its founders in shares; a token project pays them in tokens. And the standard method has always been the one closest to debasement: [mint the founder a large allocation up front](/wiki/economics/airdrops-and-token-distribution), out of the very supply everyone else will later buy. Whatever the vesting schedule wrapped around it, the structure is a pile of the enterprise's own money, created for the person at its centre, hanging over the market and waiting to be sold. When it is sold – and it is almost always sold – everyone who bought in earlier is diluted by it. The crypto era gave the pattern its own vocabulary: the premine, the founder dump, the ["team unlock"](/wiki/economics/token-unlocks-and-vesting) that markets learn to dread on a calendar.

The failure here is not that founders get paid. Founders should get paid; the person who takes the risk of starting a thing is precisely who a healthy system rewards, and rewards well. The failure is the _form_ of the payment – a stock of tokens, minted for an insider at a price no outsider ever paid, that can be turned into money only by selling it back into the same people the founder is supposed to be building for. It welds the founder's reward to an act that harms his own backers. That is debasement with extra steps.

A [caper](/wiki/foundations/what-is-a-caper) pays its founder the other way: as seigniorage, in the open, and never as a stock minted before anyone showed up. When someone buys into a caper they pay a little above the curve's bare price, and when someone sells back they are paid a little below it; that gap, on both sides of the trade, is the skim, and the founder's cut comes out of it. Until 15 September 2026 it was charged on buys alone, and the redeploy of that day spread it across both sides at half the old peak rate. The founder takes half of the skim. Most of that half is XRD, taken out of what [the curve that stands as every caper’s counterparty](/blog/the-standing-counterparty) takes in on a buy or pays out on a sale, and dropped into a vault only the founder can open. The rest is a slice of the tokens the trade moves: the ones a buy takes out of the caper's inventory, or the ones a seller hands back. Each trade pays one rate, read where a buy starts or where a sale would bottom out, so a trade costs at least what the same trade cut into pieces would. The other half of the skim is not the founder's, and two paragraphs below say where it goes.

The token slice is the part that deserves scrutiny, because at a glance it is the thing this essay just condemned. It is not, and the difference is stock against flow. A premine exists on day one: backed by nothing, priced at nothing, held by someone who paid nothing. The founder's slice is in nobody's hands until a trade arrives. A caper's whole supply sits in its own inventory from the start, held by the contract and not by the founder, and the founder's share leaves it only as part of a trade: on a buy, alongside the buyer's tokens, collateralised by the XRD just paid for them at a price an outsider set in the same transaction; on a sale, out of the tokens the seller hands back, at the price the curve is paying for them. On a caper that never attracts a buyer the founder's slice is not locked or vesting or waiting on a cliff. It was never handed over. There is no overhang because there is no stock, only a fraction of what traders themselves chose to move.

There is one thing on day one, though, and an honest account of the cut has to name it. The right to _collect_ the cut is itself a token: a single indivisible founder badge, minted when the caper is created and handed to whoever created it. The withdrawal method asks nothing of the caller except that they are holding it, and it checks that badge against the caper's own stored address rather than against any identity (`founder_take_pair` in `contracts/core/src/caper_dao.rs`). It is a bearer claim, and it is freely transferable – the one resource a caper issues that can trade outside Caper's own interface. A founder who does not want to collect the stream trade by trade can therefore sell the whole of it to somebody who does, and be paid today for demand that has not arrived yet. That is not the flaw it first looks like, and it is worth being exact about why. Nobody holding the coin is diluted by such a sale: the badge moves who receives the skim, not how much is taken or from whom, and the arithmetic above is untouched. What it does mean is that "the founder" in the rest of this essay names a role rather than a person – a claim on a fee stream that can change hands with no proposal, no announcement and nothing on the platform for holders to see. The contract takes that sale seriously enough to design for it: the badge's identity fields are locked at mint and its presentation fields answer to the registry rather than the bearer, so nobody can dress a worthless badge up as a valuable one on the way to selling it. What a founder can and cannot take is set out in full at [what a founder can take](/wiki/foundations/what-a-founder-can-take).

What the contract bounds is the rate, not the pile. The rate a trade pays is highest at launch and falls with circulation: to half the peak by 1.99% of the supply sold, a hundredth of it by 21.4%, and half of what is left with every further fifth. The founder's token slice is a fixed fraction of that rate, so it falls with it. While that slice applied only to buys, the founder's share of the coin was an average of it, which kept the share under five percent on every path. A sale now pays the same slice out of tokens that already exist, and those tokens change hands instead of retiring, so a young caper whose backers trade in and out pays the founder on both sides of every round trip, and the share has no fixed ceiling. The traders pay for that out of what they move; a holder who does not trade gives up nothing. Both legs keep paying, at a rate that shrinks as circulation grows. The rate bounds what the skim hands a founder on each trade, not what a founder may own. They can [buy on the curve](/wiki/foundations/buying-into-a-caper) like anyone else, at the same price as anyone else.

Two design choices make this honest rather than merely rebranded. First, the cut comes out of the trade, from whoever is making it: a premium on the buyer, a discount on the seller, and nothing from a holder who does neither. It is a fee on money moving in or out of the caper rather than a debasement of money already held. A sliver of the skim’s token leg – `COMMONS_SHARE` in `contracts/logic/src/lib.rs` – is routed to a shared pool, the Commons, that every caper on the platform feeds, so each new venture launched thickens the common treasury standing behind all of them. Second, and less obvious, the cut is front-loaded in rate: the founder's share of each trade is heaviest at the very first purchase and thins as the token distributes, to half the opening rate once 1.99% of the supply is in circulation, to 1% of a trade by 21.4%, and to half of what is left with every further fifth. Until the logic upgrade of 18 September 2026 the share fell in a straight line and reached zero at thirty percent of the supply; for a day after it fell as `peak / √(1 + s / 0.0225)` from a 5% peak; since 19 September 2026 it follows `peak × (2% × x + 98% × (1 − s) × x10)` for `x = 2−s/20%` from a peak of 100%, with _s_ the fraction in circulation — two halvings, one every fiftieth of the supply and one every fifth – each half as fast since 1 October 2026 – and it never stops falling. How fast each falls are constants, `COLLATERALIZATION_HALVING` and `COLLATERALIZATION_TAIL` in `contracts/logic/src/lib.rs`, and not per-caper settings anyone chooses. The Commons' slice is a fraction of the same rate, so it thins with the founder's. The half of the skim that is not the founder's belongs in an honest account of the cut rather than in a footnote. Nearly all of it is paid in XRD into the caper's own treasury, so it stays behind the token, inside [the claim every holder can redeem](/blog/the-exit-right). It replaced a flat [trade fee](/wiki/markets/trading) in September 2026, and unlike that fee it thins with the founder's share. Who receives which part of the skim is three constants compiled into the logic, not a setting any caper chooses. The reward is concentrated where the risk is – the cold open, when a founder is asking strangers to back something with no history – and on a mature token it is a small standing charge rather than the rate it charged at launch.

There is a subtlety in this that cuts against the usual launch-day greed. The _rate_ is heaviest at the start, but the founder's actual _take_ is not, because at the start the price is near nothing, and a large share of nearly nothing is nearly nothing. The real money arrives only as real backers do: per token the cut grows with the price until about 1% of the supply has sold, falls while the rate does, and from about 14% climbs with the price again. A founder cannot get rich by sniping his own launch, because at launch there is nothing there to snipe. He is paid in proportion to the interest he actually attracts – which is the only thing you would ever want a founder paid for. His incentive is fused to the single activity that also serves his backers: bringing real demand to the thing they hold. Since 15 September he is also paid a slice when a backer sells. The same change halved the peak rate, to 0.075, the level at which a buy followed by a sale cost a trader what it had cost when only the buy paid; the logic upgrade of 18 September 2026 cut it again, to 0.05, and the two of 19 September 2026 raised it to 1 and put a halving tail under it, so that most of the raise lands on the first tenth of the supply; the one of 1 October 2026 slowed both halvings by half, which leaves about half of a filled caper's raise there.

This is an old problem in a new mint. Any enterprise built around a person has to answer how that person eats without letting them loot the enterprise to do it. Salaried from the treasury, they drain the common pool. Paid in a founder's stack, they carry an overhang that punishes the faithful. The caper keeps the mint's honest half and discards its dishonest one – a visible fee on money coming in and going out, charged to the party who chose to move it and taken out of what they are moving – and then does something no historical mint ever did: it lets the fee fall with circulation, so that once the coin is in wide circulation and the risky work is behind it the founder's rate is a fraction of what it was at launch.

Seigniorage built palaces, and when it curdled into debasement it toppled the currencies that paid for them; the line between the two was always whether the one minting the money was charging a fair price or picking a pocket. For most of financial history that line was a matter of the minter's character, policed weakly if at all. A caper draws it in the contract instead. The founder is paid, well and early, out of what traders freely move and never out of what a holder who stays put already owns – and when the enterprise no longer needs bootstrapping, the cut simply ends. The person at the centre is compensated for the risk they took by the very mechanism that once let sovereigns rob their subjects, running honestly for the first time.