How to Solve Poor Tokenomics: A Creator's Guide
Poor tokenomics is the leading cause of token failure, often due to unclear utility, excessive supply, or unsustainable rewards. This guide provides seven concrete tips to structure your token for long-term success, focusing on real utility, fair distribution, and built-in sustainability. Implementing these strategies can help your project avoid common pitfalls and build lasting community trust.
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The Problem
Traditional solutions are complex, time-consuming, and often require technical expertise.
The Solution
Spawned provides an AI-powered platform that makes building fast, simple, and accessible to everyone.
What Makes Tokenomics 'Poor'?
It's not just about supply numbers; it's about broken promises and misaligned incentives.
Poor tokenomics typically stems from a few critical design failures that become apparent soon after launch. The most common is a lack of defined, actionable utility. Tokens marketed solely for 'future governance' or 'ecosystem access' without a clear path create immediate sell pressure. Another major flaw is an excessive total supply—think trillions of tokens—which psychologically devalues the project and requires constant, unsustainable buy pressure to maintain price. Finally, poor tokenomics often lacks a mechanism to fund ongoing development, leading to abandoned projects. For example, a launchpad with zero creator fees might attract initial launches but provides no revenue to improve the platform, harming long-term viability. In contrast, a structured fee model like a 0.30% per trade creator fee creates a direct, sustainable link between token success and project funding.
Tip 1: Define Specific, Immediate Utility
Your token must have a concrete use case from day one. Avoid abstract futures.
- Tie it to a Product: Is it a payment token for your AI website builder subscription? Does it grant premium features on your launchpad? State this explicitly. For instance, "Holders of 1,000 tokens get the Pro tier of our AI website builder (a $99/month value)."
- Create Scarcity Through Function: Utility should create natural demand. If your token is required to launch a project on your pad, that's recurring demand from new creators.
- Avoid 'Governance-Only' Traps: If governance is a feature, pair it with something tangible. "Governance rights + 50% discount on launch fees."
This clarity turns your token from a speculative asset into a functional tool for your ecosystem. Review how other creators structure use cases for gaming tokens on Solana for inspiration on tying tokens to specific actions.
Tip 2: Structure Supply and Fair Distribution
Get your supply numbers right. A poorly structured cap table kills confidence instantly.
- Start Smaller Than You Think: A total supply of 1 million or 10 million is often more credible than 1 billion. You can always mint more later using programs like Token-2022 if truly needed.
- Use a Bonding Curve for Fair Launch: Platforms like Spawned use a bonding curve for initial price discovery. This means the first buyer and the 100th buyer face a mathematically fair price increase, preventing instant whale dominance.
- Transparent Allocation: Clearly allocate percentages for liquidity, treasury, community rewards, and team. Lock team and treasury tokens with visible vesting schedules (e.g., 24-month linear vesting).
- Liquidity is Key: Dedicate a significant portion (e.g., 60-70%) of initial supply to the bonding curve liquidity pool. This ensures deep enough liquidity for trading and price stability from the start.
- Opt for a smaller, credible total supply (e.g., 1M-10M).
- Use a bonding curve launch for fair price discovery for all buyers.
- Publicly document token allocation and vesting schedules.
- Commit most initial supply to liquidity provision.
Tip 3: Build Sustainable Revenue for Development
A token with no way to fund its own ecosystem is a ticking clock.
This is where many free-to-launch platforms fail their creators. If the platform has no revenue, it cannot improve, market itself, or provide support. Your token's success should directly fund the project that backs it.
| Approach | Typical Model | Problem | Better Solution |
|---|---|---|---|
| No Creator Fee | 0% fee on trades (e.g., some competitors) | Project has no ongoing revenue. Development stalls, leading to abandoned tokens. | Implement a small, sustainable fee like 0.30% per trade to the creator. This funds development. |
| High Launch Fee Only | Large upfront cost (e.g., 1 SOL+), then 0% | Barriers new creators; revenue is one-time and not tied to token success. | Lower launch fee (e.g., 0.1 SOL) + small ongoing fee (0.30%). Aligns long-term success. |
| Opaque Treasury | Large token allocation to 'treasury' with no plan. | Seen as a potential dump. Creates fear, not confidence. | Use transparent fee revenue (like the 0.30%) as the primary treasury funder, visible to all. |
Tip 4: Implement Real Holder Rewards
Rewarding holders shouldn't be a promotional gimmick; it should be a core economic function. The best rewards are automatic, transparent, and tied to ecosystem activity.
Instead of one-off airdrops, consider a share of transaction volume. For example, Spawned directs an additional 0.30% of every trade to a reward pool distributed to holders. This creates a powerful flywheel: more trading volume (from a healthy token) directly generates more rewards for loyal holders, encouraging them to hold and promote the token.
This is fundamentally different from 'reflection' tokens which can be inflationary. This model uses a small slice of actual economic activity, making it sustainable as long as the token has utility. It turns every holder into a stakeholder in the token's trading health. You can learn more about structuring such incentives in our guide on how to launch a gaming token on Solana.
Tip 5: Plan for Life After the Launchpad
Your token shouldn't die after it 'graduates' from the initial launch pool. Plan for the next phase.
- Graduation to Permanent Liquidity: Use a launchpad that facilitates a smooth transition to a permanent liquidity pool (like on Raydium).
- Enable Advanced Features: Use Solana's Token-2022 program to enable permanent features like transfer fees. Spawned, for instance, allows creators to set a 1% perpetual fee post-graduation, providing lifelong, sustainable revenue.
- Roadmap Integration: Have a clear public roadmap for what happens after launch—first CEX listing, next product integration, etc. Tokenomics should support these phases.
- Community Takeover: As the project matures, real governance can begin. The sustainable revenue stream (from tips 3 & 4) funds community-proposed initiatives.
- Use a launchpad that supports graduation to permanent DEX liquidity.
- Adopt Token-2022 for features like a sustainable 1% perpetual fee.
- Publicly communicate the post-launch roadmap and governance path.
The Verdict: Solving Poor Tokenomics Requires Built-In Tools
You cannot fix poor tokenomics with promises alone; you need a launch platform designed with sustainable economics from the start. While many platforms focus only on the initial launch, they ignore the structural incentives needed for long-term survival.
For creators serious about solving tokenomics, Spawned provides the integrated toolkit. It addresses the core flaws:
- Sustainable Creator Funding: The 0.30% per trade fee ensures you have revenue to develop your project.
- Automatic Holder Alignment: An additional 0.30% reward to holders builds a loyal community.
- Long-Term Planning: Post-graduation, Token-2022 enables a 1% fee for perpetual funding.
- Reduced Overhead: The included AI website builder saves $29-99/month in costs from day one.
The low 0.1 SOL launch fee (~$20) makes it accessible. The solution isn't just advice—it's a platform that bakes good tokenomics into the launch process itself.
Ready to Build Tokenomics That Last?
Stop planning your token in a vacuum with spreadsheets and hopes. Launch on a platform that structures sustainability, rewards, and growth into your token's DNA from the first block.
Launch your token on Spawned today and get:
- Your token with built-in 0.30% creator fees & 0.30% holder rewards.
- A professional AI-generated website for your project at no extra monthly cost.
- A clear path to permanent liquidity and lifelong revenue via Token-2022.
Related Topics
Frequently Asked Questions
The most frequent and fatal mistake is creating a token with no immediate, specific utility. Launching with only vague promises of 'future governance' or 'ecosystem access' provides no reason to hold the token after the initial pump, leading to rapid sell-offs. Always tie your token to a concrete action, like accessing a paid service or receiving a discount on platform fees.
No, 0.30% is a sustainable rate that aligns incentives. A 0% fee model offers no revenue to fund development, leading to abandoned projects. A 0.30% fee on trades is small enough not to deter trading—similar to many DEX fees—but provides a continuous revenue stream. This allows creators to fund marketing, development, and support, directly tying the project's health to the token's trading activity.
True holder rewards should come from ecosystem activity, not new token minting. For example, Spawned's model allocates 0.30% of every trade to a reward pool distributed to holders. This is non-inflationary because it shares a small portion of existing transaction volume, not newly created tokens. It rewards holders proportionally to their stake and directly links their reward to the token's trading health.
A bonding curve ensures fair price discovery and prevents whale domination at launch. The price increases mathematically with each token bought, meaning the first buyer and the hundredth buyer face a fair, transparent price increase. This contrasts with a fixed-price initial DEX offering (IDO), where bots and whales can snipe most of the supply instantly, leaving the community with few tokens at a much higher secondary market price.
With Spawned, graduation means your token moves from the initial bonding curve to a permanent liquidity pool on a DEX like Raydium. Crucially, you can use Solana's Token-2022 program to enable a perpetual feature like a 1% transfer fee. This provides a lifelong, sustainable revenue stream for your project treasury, solving the 'what next?' problem many tokens face after their initial launch phase.
It is extremely difficult and often destroys trust. Major changes like reducing total supply (a 'burn') or adding new fees require community consent and are seen as reactive fixes. It's far more effective to design sustainable tokenomics correctly from the start using a platform with the right built-in tools. This is why choosing a launchpad that incorporates fees, rewards, and post-launch planning is critical.
The integrated AI website builder directly improves your project's fundamentals, which supports your token. It saves you $29-99 per month in overhead costs from day one, allowing you to allocate more funds to liquidity or marketing. A professional website also builds legitimacy, attracts more holders, and provides a hub to explain your token's utility—all of which contribute to healthier token demand and trading volume.
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