Token Network Effects

// https://medium.freecodecamp.com/token-network-effects-a-new-business-model-for-a-decentralized-web-6cde8b4e862

The underlying magic of the token is to align incentives across all stakeholders to hold the token.

In this flywheel, the token increases in value as the utility of the project increases. As long as everyone in the ecosystem believes there is value, it’ll be difficult for the token to drop to zero. Each participant of the ecosystem is now aligned to increase the value of the token.

This relationship increases the value of the token as demand for the token exceeds the limited supply, and drives up the price of the token. These market forces enable projects to fund more development (more developers, entrepreneurs, miners, participants, etc) which creates a better project.

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I work for True Ventures, an early-stage venture capital fund with offices in Northern Virginia, San Francisco and Palo Alto. We partner with promising entrepreneurs at the earliest stages in the technology market providing hands-on management support to guide our portfolio companies through the challenges of early growth. View all posts by adam →