Tokenomics 103: Evaluating Token Utility

Spending vs HoldingCash flowsGovernanceCollateral

If your goal is participating in a community, governance is a great perk for a token. 

So let’s dig into utility. We’re going to cover:

 Can use this token as collateral to borrow against?

Are you supposed to hold this token as an investment? Or is it a token you’re supposed to spend?  Is some mechanism where you get paid for holding and using a token?

In this third part, I’m going to cover utility. Utility is a subsection of the Demand side of the tokenomics equation. Even if a token has a great supply model, it still needs a good reason to exist and for people to hold it. Without those, there will be no demand for it, and no one will buy or hold it.