Crypto Needs To Rethink Incentive Structures Before The Mainstream...
Tokenomics favor speed over conviction, using genuine supporters as exit liquidity. Crypto’s mainstream future requires replacing extraction with participation incentives.
Every token launch is a story about belief. Crypto narratives often romanticize early buyers as visionaries who saw potential when others didn’t. The reality is far less noble.
The bonding curve, currently the dominant mechanism for price discovery in crypto, sets the stage: Price increases with each purchase, rewarding those who arrive early with the best entry point. On the surface, this seems fair.
Early buyers, however, are not early believers. Speed of purchase reveals nothing about conviction or commitment to the project. What the bonding curve rewards is speed. And in crypto, speed is determined by access to tools and insider knowledge.
The loudest advocates for “getting in early” are often the first to exit, using the actual believers who arrive moments later as a means of exit liquidity.
The bonding curve has become the standard for most launch platforms. Its purpose is to attract liquidity by rewarding early buyers. The structure is extractive yet straightforward: Prices increase with each purchase, creating a ladder where the position determines profit potential.
True believers — the users who genuinely care about a project’s mission, creators who want to support innovation and fans who see long-term value — typically arrive just moments later. By then, the snipers who get in the moment the contract goes live are ready to exit, dumping their positions onto the very people more likely to hold and participate authentically.
The bonding curve doesn’t only enable this. It effectively programs it into the incentive structure. Participants buy to dump because it’s the game of chicken where everyone understands the rules: Get in early, find the greater fool and get out before the music stops.
Related: BNB Chain memecoins take 30%+ tumble: Is Binance’s ‘Meme Rush’ over?The platforms have little incentive to change this dynamic as long as there’s a flow of new participants willing to test their luck. Activity and, most importantly, fees are being generated, and so it doesn’t matter how many get burned. But over time, the pool of willing participants shrinks as more people learn the hard way that they’re playing a rigged game. What looks sustainable in a bull market falls apart when inflows slow.
The current paradigm may be tolerable and even attractive to insiders and crypto n
Source: CoinTelegraph
