Tokenomics “Don’t just look at the price, my friend… The game is played inside!”
Imagine a coin is priced at 2 rupees in the market, and another at 200 rupees.
Now you might think, “Hey, the one at 2 rupees is cheaper, let’s buy that!”
But wait!
Have you seen its supply? Is it being burned? When will the developers sell? How many coins are actually in circulation?
All these answers are hidden in Tokenomics!
Let’s understand Tokenomics in simple terms:
Token = A type of currency or asset
Economics = The method of managing its use, circulation, and future value
Which means Tokenomics = Token + its entire “smartly designed” management system
Why is Tokenomics important?
Because in the crypto market, a lot of things sell based on name and show-off. But the smart investor is the one who understands the “behind-the-scenes system” — like:
How many tokens are there?
Who got how many tokens?
How many will come in the future?
How much has the team kept for themselves?
What is the Vesting Schedule?
Will there be a burn or not?
Real-Life Analogy: The Vegetable Market Game
Let’s assume there are 100 kilos of tomatoes in the market.
If 10 people come to buy — the price will be low.
But if 200 people come — the tomatoes will sell at a higher price.
This is the Supply-Demand game —
and the same happens in Tokenomics.
Key Elements of Tokenomics:
1.Total Supply:
How many tokens will ever exist?
2.Circulating Supply:
How many are currently circulating in the market?
3.Max Supply:
A limit – no more tokens will be created beyond this.
4.Allocation:
Team: 20%
Investors: 30%
Public Sale: 40%
Reserve/Burn: 10%
5.Vesting Schedule:
When and how will the team/investors receive their tokens?
Pro Tip: Instant unlock = Red flag!
Because there’s a risk of a dump.
6.Token Burn:
Permanently removing some tokens —
so that supply reduces and the value increases.
Real Case Studies:
Luna Crash (2022):
Luna’s tokenomics failed to manage the supply —
supply suddenly increased so much that the price dropped to ne
Shiba Inu Burn Strategy:
Shiba burned millions of tokens, creating scarcity —
which led to a short-term price boost.
What Should You Understand From Tokenomics?
Will the token’s value increase, or will the team dump it themselves?
Is the project a long-term play or just show-off?
Circulating Supply = The higher, the better (because there will be fewer surprises).
If the team allocation is 50%, think about it — they can sell everything anytime!
FAQs:
Q. Does more supply always mean a low price?
No. If demand is high and supply is controlled, the price can increase.
Q. Is burning good?
Yes, but if they’re just burning and there’s no real usage, then it’s just for show.
Q. Why is it important to read Tokenomics?
Because it tells you whether this token will fly or crash your money!
Tokenomics isn’t just about numbers —
it shows the project’s intent, integrity, and intelligence.
Be smart, don’t get swayed by hype —
Read Tokenomics, and only then stick around in crypto!
Thanks for your time and trust!
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