Recently, I gave a talk and shared my thoughts (including those of @OneAnalog ) on tokens, utility, and why utility tokens win in the long run... 🧵 When you think about tokens, you often imagine a badge - a symbol of value. The US dollar is a perfect example: without the system of trust, exchange and governance around it, it is nothing more than paper printed at a mill. The paper alone doesn’t give meaning; what gives meaning is what people believe it can do. So the real question isn’t just: Can this token store value? The more important question is: What utility does it carry? A token becomes interesting when it enables something — when it does something. Until then, it’s inert, like a badge no one wears. Utility should be the end goal of any token system. A token without utility may still attract attention, but it’s fragile. Utility gives a token resilience. It anchors it in real-world uses, real trade-offs, real consequences. When a token becomes more than a symbol — when using it in a “storefront” gives you access to something meaningful — then the token shifts from symbol to mechanism. I call that interface the Storefront: a space (physical, digital, hybrid) where tokens meet purpose. The Storefront is where the abstract meets the concrete; where the token’s meaning is revealed by its conversion to utility.

From Store of Value to Instrument of Use: A token conceived purely as a store of value sits waiting. It’s passive. But when you think of a token as an instrument of use, it becomes active. It becomes a key: it might grant rights, access, tools, services. When the holder uses the token, something happens. The logic shifts from “Will this hold value?” to “What can this do for me (or for others)?” The Storefront is where that shift happens. Imagine a marketplace where holding the token means you get services, rights, access, participation. The token becomes both measure and medium. The design question moves from “how to preserve value” to “how to create the interface between token-and-use.” The token needs a hook into functionality.

Designing for Utility: If you design tokens for utility you ask: What are the minimal conditions for a token to cause something to happen? How simple can the path be from possession to outcome? How clear is the conversion mechanism between token and use? Good writing uses ordinary words and simple sentences because the easier it is to read, the deeper the reader can go into the idea. Similarly, a token system with simple mechanisms is easier to understand, quicker to trust, faster to adopt. By focusing on utility we ask: Does this token produce a clear outcome? Does it interface with something people care about? Does the path from token possession to use avoid unnecessary friction? The Storefront metaphor helps visualise this: tokens enter; utility emerges; transaction completed.

Why This Matters Now: We live in a world where value is distributed, cross-chain, multi-platform, global. A token locked in one silo is limited. A token that connects across contexts, that can be used in different environments, becomes more useful. The Storefront is not just one platform; it’s a pattern. It’s the bridge between token and use. In such a landscape utility is the differentiator. Many projects focus on supply curves, governance, hype. But if you design the “last mile” — the bit where token meets action — you gain structural advantage. Utility is harder to copy than a catchy token name.

The Temptation of Memecoins and Why They Fall Short: Now let’s examine the memecoin phenomenon. Why do people ape into them? And why, in the short run and long run, is it generally not in our best interests? Why people ape in: - Low cost, low barrier: Memecoins often appear cheap, accessible. - FOMO and the “what-if” narrative: the dream of catching the next big moon-shot. - Community, identity: “I’m part of the joke, I’m part of the movement.” - Speculation disguised as play: Because utility is often lacking, you’re buying the hope someone else pays more. Why it’s not in our best interests: - Short-run risk: The rise may be fast, the fall faster. Many early entrants win; many later ones lose. - Long-run cost: When capital flows into hype instead of into utility building, the ecosystem suffers. Resources get misallocated into chasing noise rather than constructing durable networks. On a personal level: If your mindset is “I’ll ape into the next memecoin” rather than “I’ll invest in something that delivers utility,” you’re embracing gambling, not investing. Memecoins are seductive - they combine fun with financial hope. But because the locus of value is unstable - hype, virality, social momentum - they carry disproportionate risk and systemic cost.

Why Utility-Tokens Offer a Better Path: Platforms like @Firestarter_fun exemplify the alternative: tokens tied to utility, not just hype. Firestarter lets anyone tokenize anything in 20 seconds, turning any idea, asset, or community into a live tradable market with built-in storefronts, affiliate incentives, and instant liquidity. Here are reasons utility-tokens win: - The token’s value is backed by use, not just hope. - A clearer path: Token → Use → Value. - Investors become stakeholders in actual functionality and ecosystem growth. - Risk is better managed because utility is defined and meaningful. - The ecosystem is more robust: building real networks, services, use-cases instead of mere hype. When you evaluate a token: ask “What utility will this unlock? What is the user journey from holding it to using it? What friction is there? What trust margin exists in the conversion mechanism? And how will value reflect real behaviour in the system rather than mere speculation?”

Conclusion: Tokens become interesting when they’re not just tickets for hope, but keys to use. The Storefront - where token meets purpose - is the interface where value becomes meaningful. Memecoins remind us of hype’s power, but also of its fragility. If you care about the long term - if you care about building something sustainable - then aim for utility tokens, not just moonshots. Utility doesn’t just follow value. In many systems, utility drives value. Start from the causal loop: Token → Use → Value. That’s where the future lies. 🫡