Market Needs New Tokens — But Do Projects Need It?

In crypto, the loop never stops: new projects, new campaigns, new tokens. Markets ask, “when TGE?”. The better question is: “does this project actually need a token—and what will it do?”

Below is a practical guide to why projects launch tokens, how a token shapes an ecosystem, and what can go right or wrong after TGE.

Why launch a token at all?

A token is not a confetti cannon. At its best, it’s the coordination layer that aligns users, builders, and capital. Concretely, a token can be designed to provide:

• Utility access

Let holders use features (pay for computation, unlock premium modules, redeem discounts, access gated communities, or priority support). If the product has real usage, this creates ongoing transactional demand rather than one-off speculation.

• Incentives that shape behavior

Reward on-chain actions you want more of (liquidity, security services like validation, quality content or curation, referrals). Done well, this turns emissions into customer acquisition and retention, not noise.

• Governance with real stakes

Token-weighted voting can steer fees, roadmaps, and treasury allocations. Governance only matters if decisions actually change outcomes and if proposals have measurable impact.

• Economic alignment across stakeholders

Tokens let contributors, partners, and power users share upside. If value accrues through usage (fees, burns, buybacks, discounts), the token becomes a feedback loop that reinforces product-market fit.

When a token ties directly to useful actions inside a product (not just “number go up”), users participate because they get value, not because they’re waiting to sell to the next person. Or… they simply have deep trust in product.

What a TGE Сhanges: Fast storytelling

A TGE flips a private, iterating product into a public, liquid asset with 24/7 price discovery. That brings both benefits and risks.

Good outcomes (what “healthy” looks like)

• People hold for utility, not only for speculation—because the token is needed to do things that matter in the app/protocol.
• Liquidity + visibility attract more genuine users and partners.
• Clear token economics (fees, sinks, access, fair rewards) create reasons to stay, contribute, and come back.

Bad outcomes (the common failure mode)

• No real utility → airdrop farmers and early insiders sell quickly; price dives.
• High FDV + tiny float (low circulating supply) sets up a fragile pump-then-dump; as unlocks begin, fresh supply overwhelms demand.
• Trust erosion: community feels used; the project becomes “another listing that dumped,” damaging brand and future fundraising.

List First, Figure Utility Later: Researches of Tokens Going Red

In short: When projects launch tokens without a real use, the price usually goes up for a moment and then falls hard. Here are the researches proving this.

Multiple studies across 2024–2025 find that most new listings underperform after the initial pop. For example, Animoca notes that a majority of 2024 token launches struggled to gain traction post-listing, reflecting weak network effects and poor token design.

Airdrops: Keyrock analyzed 62 airdrops in 2024. Only 8 of them stayed above their starting price after 3 months — that’s about 13%. Almost all the rest dropped in value, often within the first two weeks. That’s called going red. Independent summaries put ~88–89% of airdrops in the red within ~15–90 days.

Listings: CMC Research checked how tokens behaved after they were listed on exchanges. On average, they were worth about 10% less than at the start. In many cases, the fall was even worse — about half the value gone not long after. That’s called a steep median drop.

Aggregators summarizing Animoca’s work report average drawdowns near 50% and steep median declines on several exchanges—evidence that “list first, figure utility later” tends to punish price.

Why the slide happens: FDV, float, and unlocks

Firstly, here are the simple definitions:

• FDV (Fully Diluted Valuation) is the project’s implied value if all tokens existed today
• Float is the slice of tokens actually circulating and tradable on day one.

When FDV is high but float is tiny, price can look strong early because supply is scarce. But as unlock schedules release more tokens, the market gets flooded—unless utility-driven demand grows fast enough to absorb supply. Binance Research (citing Token Unlocks) estimates ~US$155B of tokens scheduled to unlock across 2024–2030; without matching demand, that’s cumulative sell pressure landing on many assets over time.

Bottom line: supply mechanics are not neutral. If a token’s purpose is fuzzy and unlocks are aggressive, emissions act like gravity.

Airdrops: why “free” can still fail

Airdrops can bootstrap user bases, but distribution ≠ adoption. If recipients don’t need the token for anything, many will sell immediately. And this thing must be spotted in advance.

2024 data showed that only a small minority of airdropped tokens held positive returns by day 90; the majority fell within the first two weeks. Larger initial distributions (e.g., >10% supply) sometimes retained communities better than ultra-tiny drops, but utility and follow-up incentives mattered more than the split line.

The core idea: tokens must exist for something

Projects should launch a token to do a job inside the system—power fees, unlock features, secure the network, share value with contributors—not just to “have a token.” If there’s no job to be done, the market treats TGE as exit liquidity.

In the end, it’s not fair to blame users for selling. The market is driven by narratives and money. If a token doesn’t have a clear purpose, people will prefer to make quick profit instead of waiting for the project to prove its value. They sell fast, take the gain, and move on. That’s called passive earning.

Sometimes this is exactly what a project wants — to raise money and let early users cash out. That’s fine, and it happens.

But we are talking about fundamental projects and builders with long-term ideas. And Nomis is striving to be exactly that — building with purpose.

So instead of asking “when TGE?”, ask: “are we ready for TGE?”

Sincerely,

Nomis team.