Decom Network Whitepaper

Web2 E-commerce Landscape

This convenience has come at a significant cost to sellers, as control over their businesses has shifted to the platforms themselves. Where once individuals had full ownership of their storefronts and direct relationships with their customers, large e-commerce platforms now dominate the marketplace, centralizing ownership and decision-making power.

These platforms—such as Amazon, eBay, Shoppee, Lazada, and MercadoLibre—exercise unprecedented control over their ecosystems, dictating the terms of participation, fees, and even visibility within their marketplaces. Sellers face high fees, restrictive rules, and constant uncertainty due to the monopolistic practices of these platforms. Small changes to policies, algorithms, or fee structures can result in devastating consequences for sellers, often erasing years of effort and investment in building their businesses. Sellers are thus tethered to platforms that prioritize their profitability over the well-being of the individuals and businesses that depend on them. This mirrors broader Web2-era concerns, where the power struggle between platforms and individuals is underscored by issues of privacy, data ownership, and algorithmic control.

The concentration of power in e-commerce is not merely a challenge for sellers but a societal issue with far-reaching implications. Monopolistic control over significant portions of the global economy creates barriers to innovation, limits consumer choice, and consolidates wealth and influence in the hands of a few corporations. As online sales continue to grow exponentially—projected to total $6.8 trillion globally in 2025—this imbalance is only intensifying. The resulting lack of competition suppresses opportunities for small businesses and stifles the broader economic and societal benefits that a more decentralized marketplace could provide.

Left unchecked, the increasing dominance of e-commerce monopolies poses risks not only to sellers but also to consumers and the global economy. Addressing these challenges requires a reimagining of how marketplaces operate, with an emphasis on decentralization, fairness, and ownership that restores agency to sellers and fosters a more equitable commercial ecosystem.

Web2 e-commerce platforms have revolutionized trade, providing a seamless infrastructure that connects buyers and sellers globally. Platforms like eBay, Etsy, and Alibaba have enabled small businesses and individuals to access international markets, leveraging features such as secure payment systems, streamlined logistics, and powerful search functionalities. These innovations broadened access to commerce, allowing entrepreneurs to scale without the need for significant upfront investment.

However, these benefits come with trade-offs. For instance, Shoppee’s commission fees in key markets reportedly increased from 10% to as much as 13%. These arbitrary fee hikes often occur without meaningful input from sellers, placing significant financial pressure on those operating on thin margins. Sellers are forced to make difficult trade-offs: absorbing the increased costs or risking losing access to Shoppee’s marketplace, which remains a dominant player in the region (SPH Media, 2024).

Web2 platforms have undoubtedly driven e-commerce growth and provided substantial value to both buyers and sellers. However, their centralized control, data asymmetry, and lack of equitable participation reveal structural weaknesses. Addressing these issues requires a shift toward decentralized systems that empower stakeholders while retaining the efficiency and reach of Web2 innovations.

Web3 E-commerce Landscape

Web3 technologies have emerged as an alternative to traditional e-commerce platforms, leveraging blockchain and decentralized infrastructure to address many of the shortcomings inherent in Web2 systems. By enabling direct interactions between buyers and sellers, Web3 marketplaces reduce reliance on centralized intermediaries, offering enhanced transparency, ownership, and control. Platforms such as OpenBazaar and Spender exemplify early efforts in redefining e-commerce through decentralization.

A primary advantage of Web3 alternatives is their ability to prioritize user ownership of data and autonomy. Unlike Web2 platforms, which centralize data and enforce platform-specific rules, Web3 marketplaces allow sellers to retain ownership of their storefronts, transaction data, and customer relationships. Transactions are securely recorded on immutable ledgers, ensuring transparency, while open marketplace protocols prevent arbitrary rule changes by centralized platforms.

Cost efficiency is another key benefit. Decentralized platforms minimize fees by eliminating intermediaries, with many charging only network transaction fees, making them more attractive for sellers operating on thin margins.

Web3’s Shortcomings

Despite their promise, Web3 alternatives face significant challenges in achieving mainstream adoption. Part of the problem lies in clunky and unfamiliar user experiences: actions that seem normal to crypto veterans—like managing private keys or paying gas fees—can feel bewildering to newcomers. Many platforms also adopt overly technical solutions, alienating non-technical users who simply want to buy or sell goods without delving into complex wallet setups. Another stumbling block is the tendency to launch a memecoin rather than a tangible product. Relying on hype-based funding mechanisms might draw short-term attention, but it often leads to unsustainable tokenomics and erodes user trust.

Navigating local and international regulations adds another layer of complexity, as users and platforms must contend with varying compliance requirements. Scalability is another persistent issue, with many blockchain networks, such as Ethereum, constrained by high gas fees and limited transaction throughput. These limitations hinder the ability of Web3 platforms to deliver the seamless and user-friendly experiences that have become hallmarks of Web2 marketplaces.

Trust is an additional barrier. While Web3 platforms inherently offer transparency, they often lack robust mechanisms to verify seller credibility or product authenticity, which can erode buyer confidence. In the absence of comprehensive reputation systems and escrow services, decentralized marketplaces struggle to match the infrastructure and safeguards provided by established Web2 platforms.

Market Opportunity

As a $8.3 trillion global industry, e-commerce is an essential component of how people earn, interact, and live. 2.71 billion individuals—33% of the world’s population—shop online in 2024, and this market is projected to grow to $9 billion by 2027.

The rise of entrepreneurship provides an opportunity to disrupt and demand change. On average, 2.85 e-commerce websites started each day in 2024. However, the dominance of centralized platforms such as Amazon and Shoppee restricts this growth, extracting value through high fees and opaque rules.

The future of e-commerce demands a system that transcends borders, offering equitable access and enabling sellers to thrive without dependence on centralized gatekeepers. With 52% of shoppers seeking products internationally and cross-border e-commerce growing at unprecedented rates, a decentralized approach is uniquely positioned to meet this global demand.

DECOM represents a crucial counterbalance to the increasing consolidation of power among traditional digital marketplaces, particularly as recent FTC antitrust regulations have struggled to effectively curtail platform dominance. While major e-commerce giants continue to exert unprecedented control over pricing, data, and market access, decentralized platforms offer merchants and consumers true ownership of their digital storefronts and transaction data through blockchain technology.

Technical Architecture

DECOM’s architecture is built upon four foundational components that collectively enable a decentralized, trustless e-commerce experience. These four layers—Data Storage & Indexing, Global Catalog Moderation, Dispute Resolution, and Escrow—function as an integrated “stack” with each layer underpinning and enabling the one above it. In this model, Data Storage & Indexing provides a secure, distributed network of node relays that store and index marketplace data in exchange for DECOM token fees. Global Catalog Moderation then governs which products may be listed, offering a consensus mechanism to decide what is permitted and how brand ownership disputes are resolved. Next, Dispute Resolution serves as a “community notes” style system where staked judges arbitrate both catalog and transaction-related conflicts. Finally, Escrow builds atop these components to facilitate trustless payments, incorporating built-in grace periods and dispute protections to secure buyer-seller interactions.

Although the protocol layers naturally stack from the bottom up—starting with data infrastructure and culminating in escrow—this paper will discuss them in a different sequence for clarity. By extracting, standardizing, and protocolizing these four core elements of e-commerce, DECOM makes it possible for any marketplace to adopt and integrate them.

Escrow

The Role of Escrow

The escrow system in DECOM governs payments between buyers and sellers to ensure trustless, protected transactions. It serves as the central hub through which all payments flow, allowing buyers and sellers to conduct transactions securely. It must also integrate seamlessly with the dispute resolution system to provide additional trust.

Protocol Fee and Burn Mechanism

A protocol fee, paid in DECOM by marketplaces initiating an order, supports dispute resolution. These fees go directly to judges, with any surplus burned. This burn mechanism is closely linked to the gross market value (GMV) of products passing through escrow, driving supply contraction proportionate to usage.

Creating Escrow Transactions

When a buyer uses a marketplace to add multiple items to their cart, the marketplace creates an escrow transaction by splitting the order into individual transactions for each seller.

Dispute Resolution and Buyer Rebates

If a transaction completes without issues, the buyer can release payment immediately. When they do so and leave a review, they receive a small rebate in DECOM. This rebate is larger during the first four years, thanks to an active buyer incentive program. After that period, it comes from a percentage of the marketplace fee. If the buyer does not release payment, escrow automatically releases it after a minimum grace period—initially set at seven days, though this parameter can be changed by governance.

If a buyer disputes a transaction’s outcome, the case goes to dispute resolution, where judges collaborate during a defined dispute period. The result of this process determines how the funds are ultimately allocated.

Seller Staking Program

DECOM includes a seller staking feature. Sellers who lock up a certain amount of DECOM can enable the immediate release of funds to them. The staked DECOM acts as collateral in the event of a dispute. If the buyer disputes the transaction, the dispute resolution system evaluates the case. If the seller is found at fault, their staked DECOM can be used to compensate the buyer accordingly.

Dispute Resolution

General Philosophy and Overview

The dispute resolution framework in DECOM emerges from a desire to create a fair, community-driven process that does not rely on a single central authority. By drawing inspiration from systems like Twitter’s Community Notes, the protocol seeks to empower a broad pool of participants—known as judges—to examine and decide cases in a manner that balances efficiency and equity. This approach aligns naturally with DECOM’s broader mission of fostering a decentralized e-commerce ecosystem, where an escrow service safeguards transactions, and a robust community justice mechanism settles disagreements when trust breaks down.

In this model, each dispute is viewed as an opportunity to reward accurate, timely judgments and discourage malicious or negligent decision-making. Rather than appointing one arbiter or specialized team, DECOM opens the judicial process to anyone who has proven their commitment through staking and credential verification. Over time, this crowd-sourced resolution engine is refined by tracking how often each judge’s decisions align with the final outcome. Those who demonstrate consistent correctness gain higher standing and enjoy greater influence.

Because disputes often arise from everyday transactions—ranging from items that never arrive to reviews someone believes are unjust—DECOM aims to ensure that all participants feel empowered to seek redress without excessive complexity. The overarching objective is to resolve conflicts swiftly and transparently, allowing the community to govern its own marketplace. This emphasis on shared responsibility and verifiable on-chain actions lays the groundwork for a self-sustaining system in which individuals can confidently trade goods and services, knowing a fair mechanism exists to handle disputes.

Types of Disputes

Within the DECOM ecosystem, disputes can arise for a variety of reasons, but they generally fall into three main categories:

• Buyer-Seller Disputes: These are the most common and straightforward type of conflicts. A typical example is when a seller marks an item as delivered, but the buyer claims they have not received it. Ideally, the buyer and seller work things out directly—perhaps confirming shipping details or re-sending the order. However, if no mutual resolution is possible, the case escalates to DECOM’s dispute resolution system. Both parties then submit evidence, and a pool of community judges renders a final verdict.
• Review Disputes: This second category involves disagreement over the validity or accuracy of a review. Maybe a buyer feels a seller’s reputation has been unfairly tarnished by a malicious review, or a seller believes a buyer’s rating fails to reflect the true transaction outcome. As before, a dispute negotiation system attempts to resolve the issue first; if it fails, the matter moves to the dispute resolution system, where evidence on both sides is presented.
• Product Catalog Disputes: Finally, DECOM also empowers the community to adjudicate listing and brand-related conflicts. A product might violate a protocol-wide ban (for example, disallowed items), or it may raise trademark issues (such as unauthorized use of a brand). These disputes can be simple—verifying whether an item truly meets community guidelines—or more complex, involving in-depth brand ownership considerations. For higher-stakes conflicts, DECOM may designate “specialist judges” or a “DECOM Supreme Court” for final judgment, ensuring that nuanced cases receive the focused attention they require.

In each of these dispute types, the same core mechanism—community-driven adjudication—remains at the heart of the process. By categorizing the kinds of conflicts that arise, DECOM empowers judges to assess them more swiftly and tailor their decisions to the unique dynamics of each situation, ultimately strengthening trust across the network.

Dispute Lifecycle

A dispute arises whenever direct negotiation between the parties fails—most commonly, a buyer claims non-delivery while a seller insists the item was sent. Either party can submit evidence, which the protocol anonymizes before sending to the Case Pool. An initial AI voting pass generates baseline rationales that give human judges something to evaluate. Once human judges begin voting, they each provide a decision.

Each case remains active until it meets one of two conditions:

• The minimum vote threshold is reached (initially three weighted votes out of five possible), and the dispute period (initially 36 hours) has expired.
• The maximum vote threshold is reached (six weighted votes out of eleven possible) before the dispute period ends, automatically deciding the outcome.

All votes are weighted based on a judge’s humanness, correctness, and experience. As soon as one side attains the necessary critical value—and time constraints are satisfied—the protocol finalizes the ruling, releasing funds accordingly or updating any relevant product listings. This same lifecycle applies to review disputes and product catalog conflicts, though more complex brand or listing cases may escalate to specialist judges if the issues warrant deeper scrutiny. By blending AI-generated initial positions with community-driven decision-making, the system aims for an efficient yet transparent process that rewards active and accurate participation.

Weighted Voting and Critical Threshold

To safeguard fairness and reward reliable participation, DECOM uses a weighted voting mechanism in its dispute resolution process. Rather than counting each judge’s vote equally, the protocol factors in three key attributes:

1. Humanness: A measure of the judge’s verified identity (e.g., Gitcoin Passport or WorldCoin ID). Fully verified human judges typically receive a higher humanness score (close to 1.0), while AI or partially verified accounts start lower.
2. Correctness: The fraction of past disputes in which the judge’s vote aligned with the majority outcome. Judges who consistently agree with final rulings gain a higher correctness score, reflecting their reliability.
3. Experience: A track record of active participation and successful outcomes over multiple epochs. Judges with consistent engagement earn greater weight, ensuring those who repeatedly prove themselves gain influence.

Each judge’s total vote weight w_j is determined by multiplying these factors—often raised to exponents or scaled by constants to tune the system’s sensitivity. A simple model might look like:

w_j = α × (H_j)^β × (C_j)^γ × (R_j)^δ,

where H_j is humanness, C_j is correctness, R_j is experience, and α, β, γ, δ are constants set by the protocol or adjusted via governance.

Critical Threshold

Disputes can remain open until they meet either a minimum or maximum vote requirement:

• Minimum Vote Threshold (Quorum): The lowest number of weighted votes needed for a case to be validly decided. In early phases, this may be set to 3 votes (out of 5 possible) by default. However, it only takes effect if the dispute period (e.g., 36 hours) also expires.
• Maximum Vote Threshold: An upper limit on votes for any single case, initially 6 votes (out of 11). If one side reaches this critical number before the dispute period ends, the system immediately finalizes the outcome.

These thresholds ensure that disputes can conclude efficiently without requiring an excessive number of votes. As soon as a side surpasses the applicable critical value, the case is decided in favor of that side. If it happens at or above the minimum threshold near the end of the dispute window, the case finalizes once time expires. If it happens at the maximum threshold prior to the dispute window’s end, the system finalizes the ruling immediately.

Tokenomics

Tokenomics Overview

DECOM’s tokenomics aim to incentivize growth in Gross Merchandise Value (GMV) across the system while ensuring timely resolution of disputes. By rewarding users who contribute positively to the ecosystem—and burning tokens based on protocol fees—DECOM balances expansion with deflationary pressure as transaction volume increases.

Core Burn Mechanic

A significant portion of DECOM’s burn comes from completed orders, where a protocol fee (paid by marketplaces) is collected and partially burned. This design ties the token’s burn rate directly to the volume of successful transactions:

• As order flow and GMV rise, more tokens are burned proportionally.
• This ongoing burn helps stabilize token supply and align token value with increased protocol activity.

Core Emission Mechanics

Beyond the initial mint, DECOM continually emits new tokens to:

1. Judges: Individuals (or verified agents) who adjudicate disputes, ensuring that conflicts are resolved fairly and swiftly.
2. Governors: Participants in the governance process responsible for maintaining protocol parameters and voting on system upgrades.
3. Liquidity Providers: Users supplying liquidity to DECOM trading pools, enabling reliable on-chain price discovery. This accurate pricing is essential for the escrow contract to calculate protocol fees in DECOM.

These emissions reward vital roles that uphold the ecosystem’s integrity—whether by settling disputes, securing governance, or facilitating liquidity.

Four-Year Bootstrap Emissions

To jumpstart adoption and community momentum, DECOM introduces an additional emissions schedule during the first four years:

• Early-Stage Incentives: Allocated to new participants and initiatives that grow network usage.
• Enhanced Judge Rewards: Judges receive higher compensation rates in the early phases, promoting quick dispute resolution and a robust judging pool.
• Liquidity Mining Programs: Liquidity providers gain elevated yields to encourage deep, stable markets for DECOM during initial expansion.

These four-year “bootstrap” measures sit atop the natural burn and emission mechanisms, accelerating usage and trust-building from launch. By phasing out enhanced emissions over time, DECOM transitions organically to its steady-state token economy, relying primarily on transaction-based fees and the core emission model.

Total Initial Mint: 1,000,000,000 DECOM

Mint & Vesting Breakdown

Governor Vest (Team, Investors, and Advisors)

• 0 distribution for the first 6 months.
• 15% Cliff at Month 6.
• Another 15% Cliff at Month 24.
• Remaining 70% distributed via daily linear vest from Month 24 to Month 48.

18-Month Cliff (Early Sellers)

• All tokens available 18 months after TGE.

2-Year Cliff (Reserve)

• Entire 10% remains locked for 24 months.
• At Month 24 (2-year mark), tokens become available (or remain locked subject to a governance decision).

Community Emissions Schedule (35% of Supply)

A total of 350,000,000 DECOM is reserved for various community incentives, split as follows:

• Governance Rewards: 10% of total (100M tokens)
• Seller Incentives: 8% of total (80M tokens)
• Buyer Incentives: 7% of total (70M tokens)
• Judge Incentives: 5% of total (50M tokens)
• Marketplace Incentives: 5% of total (50M tokens)

Each sub-allocation (with the exception of Marketplace Incentives) follows a 3-Epoch distribution over 48 months:

Epoch 1 (Months 0–6)

• Governance Rewards: 0% distribution during first 6 months (accumulated 0%)
• Seller/Buyer/Judge: 25% of each category’s total linearly distributed

Epoch 2 (Months 6–18)

• Governance Rewards: 25% of its total distributed linearly over these 12 months
• Seller/Buyer/Judge: 50% of each category’s total distributed linearly

Epoch 3 (Months 18–48)

• Governance Rewards: Remaining 75% distributed over 30 months
• Seller/Buyer/Judge: Remaining 25% distributed over 30 months

Marketplace Incentives will be given out as block-grants to new marketplaces adopting or integrating the DECOM protocol.

Governance

Governance Overview & Philosophy

DECOM’s governance model reflects a constitutional approach that balances representative oversight with direct, token-weighted democracy. Initially, the protocol relies on a HATS Shadow Council, vested with the responsibility to handle crucial day-to-day decisions and parameter updates. Meanwhile, DECOM token holders, through a staking-and-voting mechanism reminiscent of Curve’s veCRV model, retain the ultimate power to amend the on-chain constitution or veto major council resolutions if they believe the protocol’s core values are at risk.

Roles & Responsibilities

The HATS Shadow Council

The HATS Shadow Council serves as DECOM’s primary decision-making body during the protocol’s early stages. It is empowered to:

• Manage Key Parameters: The council can adjust short-term variables—like dispute resolution thresholds, judge emissions, or fee splits—to maintain the protocol’s health and responsiveness.
• Oversee Major Upgrades: While token holders ultimately approve fundamental changes, the Shadow Council coordinates technical work and proposes implementation plans for wide-reaching initiatives.
• Ensure System Stability: Council members are tasked with preventing critical failures or malicious attacks, especially in the protocol’s formative period.

Initially, the founding team appoints certain seats to accelerate development and troubleshoot early challenges. Once the protocol matures, the community elects new council members via token-weighted voting, reflecting a shift toward more decentralized control. Over time, the HATS Shadow Council’s active role is intended to diminish, ceding more decisions to automated or community-wide processes as DECOM’s usage patterns stabilize.

Token Holders & Stakers

DECOM token holders form the broader base of governance power. Though they may not vote on every parameter, they maintain ultimate authority over:

• Constitutional Amendments & Vetoes: Token holders can override council decisions that stray from foundational principles.
• Electing or Removing Council Members: They cast token-weighted votes to select or remove individuals serving on the HATS Shadow Council.
• High-Impact Governance: Proposals that significantly alter smart contracts, shift major emission schedules, or redefine the on-chain constitution require wide community support to pass.

In line with a veCRV-style model, long-term stakers gain increased voting power, aligning them more closely with the protocol’s health. Stakers earn governance rewards drawn from community emissions (Section 5.4), promoting ongoing participation and deterring speculation from short-term token holders.

Appointed vs. Elected Roles

While most council seats are intended to be filled via community elections, certain specialized roles may be appointed by the founding team or the existing council if they require unique expertise (e.g., specialized judges, development expertise). The tenure and reappointment process for these roles should be transparently defined on-chain, enabling token holders to reassess whether such specialized seats remain necessary as the protocol and its user base evolve.

Early-Stage vs. Mature Protocol

During DECOM’s bootstrap phase, the HATS Shadow Council wields more authority, due in part to the protocol’s rapid iteration needs. As the platform attracts a critical mass of users, participants, and liquidity, routine decisions can be automated or delegated to specialized committees, with the community stepping in only when significant governance choices arise. Ultimately, the long-term vision sees the council focusing on strategic guidance and ensuring protocol security, while a well-informed community confidently navigates day-to-day parameter changes through open, transparent processes.

Pre-TGE Constitutional Convention

Before the Token Generation Event (TGE), DECOM will hold a Constitutional Convention that invites core contributors, early adopters, and prospective community members to collaboratively shape the founding principles of the protocol. While the on-chain constitution can always be amended in the future, the aim is to establish a clear ethos at launch—one that guides both day-to-day decisions and significant policy changes over time.

Scope of the Convention

1. Shared Values & Principles: Participants will define the basic tenets of DECOM’s marketplace ethics, including ethical guidelines, acceptable product categories, and initial brand ownership rules. These values set a baseline for deciding which items can appear on the global product catalog, how brand disputes are resolved, and whether certain product types are forbidden.
2. Procedural Covenants: The community will draft broad procedures for how to handle subjective or edge-case disputes. Examples include guidelines for evaluating gray-area items, dealing with international regulatory differences, and addressing brand conflicts that exceed simple clarity.
3. Participation & Feedback: Both technical and non-technical stakeholders are encouraged to contribute, with each group providing unique perspectives—developers on feasibility, sellers on practicality, buyers on safety, and so forth. This collaborative ethos ensures that the final document reflects the community’s genuine needs rather than a single authoritative viewpoint.

Ratification & On-Chain Adoption

Following a series of open discussions—likely via forums, social channels, and online meetings—the preliminary constitution will be drafted. Once the community reaches consensus or near-consensus on its contents, the constitution will be ratified on-chain through a token-weighted vote. This ratification process formalizes the community’s collective will, making any subsequent amendments subject to the governance mechanisms outlined in Sections 6.4 and 6.5.

Long-Term Significance

While the Pre-TGE Constitutional Convention represents an early milestone, its influence will persist throughout DECOM’s lifecycle. The on-chain constitution it produces will serve as a North Star for:

• Global Product Catalog Moderation (Section 4.3), guiding how items are permitted or banned.
• Dispute Resolution (Section 4.2), providing normative standards for judges resolving conflicts.
• Future Governance (Section 6.4), setting the tone for major upgrades or parameter changes.

Over time, the convention’s initial framework may evolve as the protocol grows and new challenges arise. Even so, the early adoption of clear community guidelines ensures that DECOM’s subsequent governance remains aligned with the founding vision—preserving trust, fairness, and openness across all marketplaces that integrate the protocol.

Governance Processes

HATS and Role-Based Privileges

DECOM governance uses HATS, a modular on-chain role management system that assigns specific responsibilities and permissions to approved addresses. Each “hat” corresponds to a distinct privilege level—ranging from routine parameter updates to major contract upgrades—and can be transferred, updated, or revoked by governance decisions. By separating roles into discrete “hats,” the protocol ensures each function (e.g., adjusting fee parameters or merging a proposed smart contract upgrade) is tracked transparently, reducing the risk of power being concentrated in a single entity.

Within this structure, the HATS Shadow Council collectively holds the critical hats needed to oversee day-to-day decisions in early phases, providing a balance between efficiency and accountability. Over time, additional hats can be minted or reassigned to community members, allowing for progressive decentralization as DECOM matures.

Veto Mechanism

Every governance decision—be it a small parameter tweak or a major system change—is subject to a potential community veto. If a sufficient percentage of tokens locked in governance (this threshold will be formalized during the Pre-TGE Constitutional Convention) supports blocking a proposal, the measure is halted. This mechanism ensures token holders retain ultimate authority, even as most routine tasks remain in the hands of the HATS Shadow Council.

Enumerating Core Parameters & Review Timeline

DECOM maintains a Parameter Registry that lists all variables subject to governance oversight. Although some of these parameters may be partially automated in the future, they initially require regular review and possible adjustment by the council and community. Below is a non-exhaustive list:

1. Judge Emissions (monthly review): Rate of token issuance to dispute-resolution judges. Adjusted if the system detects a shortfall or surplus of judge participation.
2. Fee Splits (quarterly review): Proportions of protocol fees allocated to burning, judge rewards, and a community treasury. May be rebalanced to reflect evolving economic conditions or to address a sudden surplus/deficit in token supply.
3. Dispute Timeframes (quarterly review): Minimum and maximum durations of dispute voting (initially set at 36 hours). Altered if data shows too many or too few disputes are completing on time.
4. Escrow Grace Period (semi-annual review): Time before escrow auto-releases funds if a buyer does not dispute. Allows the community to fine-tune user experience as transaction volumes grow.
5. Seller Staking Requirements (semi-annual review): Amount of DECOM sellers must stake to enable immediate fund release.
6. Liquidity Reward Rates (semi-annual review): Emissions for liquidity providers in DECOM trading pools. Influenced by on-chain metrics like trading volume, price volatility, and overall liquidity depth.

Minor vs. Major Decisions

Minor Decisions (Routine Tweaks):

• Handled by the HATS Shadow Council without requiring a full community vote.
• Includes monthly or quarterly adjustments like judge emission rates or fee splits.
• Can be vetoed if a sufficient percentage of locked tokens calls for a review.

Major Decisions (Significant Upgrades):

• Affect core smart contracts or the fundamental distribution of DECOM tokens.
• Typically require a formal proposal, a defined discussion period, and token-holder ratification.
• Remain subject to veto throughout each stage of the process.

Staking & Voting Power

veCRV-Style Token Locking

DECOM’s governance design leverages a mechanism inspired by veCRV, in which token holders can lock DECOM tokens for varying durations in exchange for enhanced voting influence. The longer one locks tokens, the greater weight their votes carry, reflecting a deeper commitment to the protocol’s long-term success.

Under this model, a token holder deposits DECOM into a governance contract, committing those tokens for a set time (e.g., six months to four years). During the lock period:

• Voting Weight: The holder’s voting power scales with the length of their lock. A four-year lock confers significantly more influence than a six-month lock, encouraging governance participants to think long-term rather than chasing short-term gains.
• Token Illiquidity: Locked tokens cannot be moved or sold until the end of the chosen duration, which helps ensure only committed individuals hold major sway over governance decisions.

Governance Rewards

To foster sustained participation, DECOM allocates a portion of its community emissions (see Section 5.3) to stakers who actively vote or delegate their voting rights. This reward structure aligns token holders with the protocol’s health, incentivizing them to stay engaged in decision-making. The HATS Shadow Council may periodically review:

1. Reward Rates: The portion of emissions directed toward governance stakers.
2. Lock Durations: Whether additional lock intervals should be introduced or existing lengths should be adjusted.
3. Participation Criteria: Minimum voting or proposal activity needed to remain eligible for governance rewards.

Minimizing Governance Fatigue

While stakers enjoy higher voting power, DECOM seeks to avoid constant overhead for routine decisions. To mitigate governance fatigue:

• Delegation: Token holders can delegate voting power to trusted representatives or committees, reducing the pressure to participate in every small vote.
• Tiered Decision Model: Minor parameters (listed in Section 6.4.3) are typically handled by the HATS Shadow Council. Community input is only necessary if a veto is triggered or a major upgrade is proposed.
• Transparent Proposal Flow: All proposals and decisions appear on-chain or in public forums, ensuring that even stakers who delegate votes can stay informed of new developments.

Veto & Amendment Power for Stakers

Because stakers collectively wield final authority, they can:

• Block Undesirable Proposals: If a council decision lacks broad community support, stakers can invoke the veto mechanism (Section 6.4.2).
• Amend Core Principles: Should the community seek to redefine product categories, brand ownership rules, or any other constitutional element, a sufficiently large staker majority can enact amendments per the processes outlined at the Pre-TGE Constitutional Convention (Section 6.3).

Ultimately, this staking and voting system ensures that those most invested in DECOM’s long-term success hold the greatest influence on its governance. By balancing token locks with meaningful incentives and optional delegation, the protocol fosters an environment of committed participation without requiring everyday micromanagement from every token holder.

Roadmap

DECOM has already reached a critical milestone by delivering a live service capable of processing payments—effectively a minimum viable product (MVP). Looking forward, the roadmap concentrates on deeper technical integrations, ecosystem partnerships, user experience enhancements, and a phased approach to full governance decentralization. Below is a revised, more holistic outline of the upcoming phases, including projected timelines and key initiatives.

Current Progress & Near-Term Goals (Now - Q2 2025)

Live MVP & Payment Processing

Status: DECOM has an operational service handling e-commerce transactions on-chain, laying the groundwork for broader protocol adoption.

Next Steps: Refine stability, gather feedback, and address any immediate user experience (UX) issues identified during MVP usage.

Cross-Chain Payments & Wallet Abstraction

Goal: Expand payment methods to include Bitcoin, Solana, and other networks, bridging them back into a unified DECOM ecosystem.

Timeline: Full wallet abstraction (supporting cross-chain payments) is targeted for completion by July 2025, enabling one-click payment flows.

Rationale: Broader crypto acceptance meets users where they are, ensuring fewer barriers to entry.

Expanding Partnerships & Preparing for TGE (Q2 - Q4 2025)

SDK Development & E-commerce Integrations

Milestone: Finalize a developer-friendly SDK that external marketplaces can deploy to leverage DECOM’s Escrow, Dispute Resolution, and Catalog Moderation.

Timeline: Targeted release in Q3 2025, coinciding with deeper platform partnerships.

Token Generation Event (TGE)

Launch Window: Q4 2025 or Q1 2026 (dependent on successful audits and partnership readiness).

Activities:

• Pre-TGE Constitutional Convention
• Distribution of initial liquidity (5% of total supply).
• Start of community emissions (governance, sellers, buyers, judge incentives).
• Staking and governance activation for early adopters.

Security Audits & Testing

Contracts in Scope:

• Token contracts (Bridge Round, TGE mechanics).
• Justice/Dispute Resolution components.
• Enhanced Escrow functionalities.

Timeline:

• Mid-June 2025: Begin first-phase internal audits of existing smart contracts.
• Q3 2026: Engage external audit firm and individual security researchers for a more robust review, prior to TGE.

Deliverable: Public release of audit findings and improvements implemented.

User Adoption & Community Growth (Q3 2025 - Q3 2026)

Onboarding & Educational Initiatives

Objective: Address Web3’s “clunky UX” through account abstraction, one-click payment, and credit card on-ramps.

Timeline:

• Q2 - Q3 2025: Launch educational materials, tutorials, and user-friendly tooling.
• Q4 2025: Implement credit card gateways for non-crypto users.

Regional Pilot: Roll out an initial marketplace in South America (Q4 2025) to test cross-border commerce in emerging markets.

Marketing & Community Engagement

Incentives:

• Begin offering integration incentives in Q2 - Q3 2025 to encourage projects to list on DECOM.
• Deploy affiliate/referral system for user acquisition.

Cross-Promotional Events: Partner with DePIN (Decentralized Physical Infrastructure Networks) brands in Q3 - Q4 2025 to expand the ecosystem’s visibility.

Data Hosting & Indexing (Q2 - Q3 2026)

Decentralized Node Relay Launch

Milestone: Introduce the node relay network for storing and indexing product data, akin to the “TCP/IP of product data.”

Incentive Model: Propose new emissions schedules (and possible burn mechanics) specifically rewarding data hosts.

Timeline: Target implementation by mid-2026, post-TGE.

Refining the Token Model

Objective: Incorporate data hosting rewards into the existing DECOM tokenomics, ensuring node operators are motivated to maintain uptime and reliability.

Timeline: Governance proposals to formalize these emissions in Q3 2026.

Governance Maturation (Q3 2026 - Beyond)

HATS Shadow Council & Sub-DAOs

Early Oversight: The HATS Shadow Council initially manages key parameters across newly launched systems (e.g., data hosting).

Transition: Over the next 6-12 months post-launch of each subsystem, governance will ossify these processes, reducing council discretion.

Full Decentralization & DAO Evolution

Sub-DAO Formation: Create specialized committees for areas like data hosting, brand ownership, and dispute policy, each with defined responsibilities.

Autonomous Parameterization: As usage grows and the protocol stabilizes, manual tweaks give way to automated or community-driven systems, with major upgrades requiring broad token-holder consensus.

Appendices and References

Appendices

Appendix A: Detailed Tokenomics Schedule

The tokenomics of DECOM, as outlined in Section 5, are critical to aligning incentives across the ecosystem. Below is a detailed breakdown of the token distribution and emissions schedule, including monthly token releases for each allocation category over the 48-month vesting period.

• Total Supply: 1,000,000,000 DECOM tokens.
• Team, Investor, and Advisor Allocations (Governor Vest):
  • Months 0-6: 0 tokens distributed.
  • Month 6: 15% cliff (22.5M for Team, 30M for Investors, 7.5M for Advisors).
  • Months 7-24: 0 tokens distributed.
  • Month 24: 15% cliff (22.5M for Team, 30M for Investors, 7.5M for Advisors).
  • Months 24-48: Remaining 70% distributed linearly (4.375M per month for Team, 5.833M per month for Investors, 1.458M per month for Advisors).
• Early Seller Allocation (18-Month Cliff):
  • Months 0-18: 0 tokens distributed.
  • Month 18: 100M tokens released.
• Reserve Allocation (2-Year Cliff):
  • Months 0-24: 0 tokens distributed.
  • Month 24: 100M tokens become available, subject to governance.
• Community Incentives (3-Epoch Distribution):
  • Governance Rewards (100M Tokens):
    • Epoch 1 (Months 0-6): 0 tokens.
    • Epoch 2 (Months 6-18): 25M tokens (2.083M per month).
    • Epoch 3 (Months 18-48): 75M tokens (2.5M per month).
  • Seller Incentives (80M tokens):
    • Epoch 1 (Months 0-6): 25% (20M tokens, 3.333M per month).
    • Epoch 2 (Months 6-18): 50% (40M tokens, 3.333M per month).
    • Epoch 3 (Months 18-48): 25% (20M tokens, 0.667M per month).
  • Buyer Incentives (70M tokens):
    • Epoch 1 (Months 0-6): 25% (17.5M tokens, 2.917M per month).
    • Epoch 2 (Months 6-18): 50% (35M tokens, 2.917M per month).
    • Epoch 3 (Months 18-48): 25% (17.5M tokens, 0.583M per month).
  • Judge Incentives (50M tokens):
    • Epoch 1 (Months 0-6): 25% (12.5M tokens, 2.083M per month).
    • Epoch 2 (Months 6-18): 50% (25M tokens, 2.083M per month).
    • Epoch 3 (Months 18-48): 25% (12.5M tokens, 0.417M per month).
  • Marketplace Incentives (50M tokens):
    • Distributed as block-grants to new marketplaces adopting or integrating the DECOM protocol.

References

The following sources were cited or consulted in the preparation of this whitepaper, providing context for the e-commerce landscape, Web3 challenges, and regulatory environment:

• SPH Media (2024). “Shoppee Raises Commission Fees in Key Markets.”
• E-commerce Market Data.
• OpenBazaar Documentation (archived). Note: OpenBazaar’s official site is no longer active; archived documentation may be available via https://web.archive.org.
• Federal Trade Commission (FTC) Reports on Antitrust Actions Against E-commerce Platforms (2023-2024). Available at: https://www.ftc.gov.
• SEC Framework for Investment Contract Analysis of Digital Assets (2019). Available at: https://www.sec.gov/corpfin/framework-investment-contract-analysis-digital-assets.
• McKinsey & Company (2024). “The Rise of Cross-Border E-commerce.” Available at: https://www.mckinsey.com.

Additional Resources

For readers seeking to engage with the DECOM Protocol or learn more about its development:

• Official Website: https://decom.network.
• Developer Documentation: [Insert developer docs URL, e.g., GitHub repository].
• Community Forum: [Insert forum or Discord URL, for community discussions].
• Whitepaper Updates: Future revisions to this whitepaper will be published on the official website to reflect protocol developments and community feedback.