In Web3, launching a project often comes with an assumption:
👉 it needs a token
Tokens are seen as:
- a core component
- a growth mechanism
- a funding tool
But in many cases, they’re none of those things.
They’re unnecessary.
How Tokens Became the Default
In early crypto:
- tokens enabled networks
- incentivized participation
- secured systems
This made sense.
But over time, the model expanded.
Now, tokens are added to:
- apps
- platforms
- products
Even when they don’t serve a clear purpose.
The Misalignment Problem
A token introduces its own system:
- supply
- demand
- incentives
- market dynamics
If that system isn’t aligned with the product:
👉 it creates friction
Instead of value.
What a Token Is Supposed to Do
At its best, a token should:
- secure a network
- coordinate participants
- align incentives
Without one of these functions:
👉 the token becomes cosmetic
When a Token Becomes a Distraction
Many projects focus more on:
- token price
- liquidity
- market attention
Than on:
- product quality
- user experience
- real adoption
This shifts the focus from:
👉 building something useful
To:
👉 maintaining a market
When speculation is removed, the necessity of a token becomes much clearer.
The Liquidity Trap
Once a token exists, it requires:
- attention
- trading activity
- ongoing interest
Which means:
👉 the project must continuously feed the market
Instead of focusing purely on the product.
Why Some Products Work Better Without Tokens
Many successful products don’t need tokens because:
- value comes from usage
- not speculation
- not financial incentives
In these cases, adding a token:
👉 complicates the system
Without improving it.
The Cost of Introducing a Token
A token adds:
- regulatory complexity
- technical overhead
- user confusion
It also introduces:
- volatility
- expectation of profit
- external pressure
User Experience Gets Worse
For users, tokens often mean:
- additional steps
- extra decisions
- financial risk
Instead of:
👉 a simple product experience
The Incentive Problem
Tokens are often used to drive behavior.
But incentives can distort usage.
People may:
- use the product for rewards
- not for value
Which leads to:
👉 artificial activity
The Difference Between Infrastructure and Products
Tokens make sense at the infrastructure level:
- blockchains
- protocols
- coordination layers
They make less sense at the product level:
- apps
- tools
- services
Where usability matters more than incentives.
Why the Industry Defaults to Tokens
Because tokens offer:
- funding
- visibility
- rapid growth
They attract:
- attention
- capital
- participation
Even if the underlying product isn’t ready.
What Actually Drives Long-Term Value
Sustainable products are built on:
- usability
- adoption
- consistency
Not on:
- speculation
- token performance
- short-term hype
Long-term value comes from usage — not financial incentives alone.
The Future: Fewer Tokens, Better Products
As Web3 matures:
- unnecessary tokens will disappear
- useful ones will remain
- products will prioritize experience
WTF does it all mean?
Tokens are powerful.
But they’re not required.
Adding a token doesn’t make a product better.
In many cases:
👉 it makes it worse
The projects that succeed long-term
won’t be the ones with the most tokens.
They’ll be the ones that:
👉 don’t need them
Part of the Web3 Reality Series
This article is part of a series exploring how Web3 actually works in practice.
👉 Explore the full series:
https://jasonansell.ca/web3-reality-what-decentralization-actually-looks-like/
