Token holders vs. users: Who should you focus on?

Early-stage crypto projects often chase token holders because they’re cheap to acquire and generate hype.

But here’s the problem: token holders aren’t real users.

Their interest fades as soon as a shinier opportunity appears. If your project never builds a real user base, the hype dies, and with it, your token’s value 📉

Users, on the other hand, are harder to acquire. They require more time, capital, and product development, but once engaged, network effects kick in, creating sustainable growth.

The best strategy?
1️⃣ Leverage token holders for early growth.
2️⃣ Shift focus to acquiring real users before the hype fades.
3️⃣ Build a token model that connects long-term utility with real demand.

Most projects fail because they overestimate their ability to convert token holders into users. Don’t be one of them.

Reflexive and Dynamic Ecosystem Incentive Emission Algorithms

Tuesdays are for tokenomics at Simplicity.

This time, our researchers took a deep dive into reflexive and dynamic incentive emission algorithms, breaking down how projects like DIMO, Helium, Filecoin, Inverter Network, and Monitize.ai (via VADER’s tokenomics) are putting them to work.

Read now: https://x.com/SimplicityWeb3/status/1896837574427123969

Let’s talk DeFi.
What’s real, what’s noise, and what’s dead weight?

Friday, March 6.
🕒 3:00 PM UTC | 4:00 PM CET | 6:00 PM GST

Speakers:
Folks Finance
Zoth
GoGoPool
Bunni - Psaul
Hosted by Simplicity Group

Expect real conversations on why some projects thrive, why others fade, and what’s actually worth building.

Set a reminder: https://x.com/i/spaces/1lPJqMgWDdQJb

See ya soon

One of our clients wanted to incentivize long-term token locking with exponentially greater rewards, but needed a flexible mechanism (based on certain pre-set numbers).

We designed a custom formula where adjusting α (0 to 1) shifts rewards from linear to exponential, letting them fine-tune incentives based on demand.

Because tokenomics is more than just vesting schedules & TGE unlocks.

Happy Monday

which Alex are you today?

Startup founders struggling to raise? Read this

There are two types of founders:

-Those with T1-2 VCs on the cap table.
-Those without.

The difference? It’s simpler than you think:

- Your product solves a big problem.
- Your product doesn’t solve a big problem.

But here’s the nuance.

PayPal didn’t need to exist: cards worked fine. But eBay super sellers needed faster payments.

Airbnb didn’t solve a crisis, hotels were always there. But budget travelers in NYC needed a cheaper option.

Facebook wasn’t essential, nobody needed their life online. But uni students craved more drama and gossip.

The biggest companies didn’t start by solving global problems. They dominated niche markets first.

So, if T1-2 VCs aren’t calling you:
You either solve an undeniable problem, and they come onboard.
Or, you own a niche, win there, and expand.

Most of Web3 isn’t solving real problems.

SocialFi? Not needed.
DeFi? We already have every financial tool possible.
Infra? Some is necessary, most isn’t.

Either solve something real or own a niche, or thanks for playing.

Web3 marketing in a downturn – can you still win when the market isn't?

Join us this Wednesday, March 12, at 3:00 PM UTC to discuss what marketing actually works today, with insights from those who’ve been through it.

This space is a must for Web3 builders, projects preparing for launch, teams keeping the momentum alive, and anyone working in or curious about Web3 marketing.

🔹Speakers:
Coiniseasy
k_laptevait3
bezh_a
Alicestork1
OxFer_
CrisNajeraG
Nekrosius8
nastyasto_

Hosted by SimplicityWeb3

📌Set a reminder & tune in!
https://x.com/i/spaces/1OdJrDdPjrlKX

Why Simplicity? The numbers don’t lie

https://calendly.com/enquiries-simplicity/partnerships

Pricing your token for fundraising rounds isn’t as simple as picking a number. You have to balance:

1. Your total valuation at public launch.
2. The price difference between seed, private, and public rounds.
3. How much funding you actually need.
4. Avoiding excessive control by early backers.

Example:
A project selling 5% of tokens at $1.50 each in a private round with a total supply of 1M tokens has a $1.5M valuation.

(1.50 × 50,000) ÷ (1,000,000 ÷ 100 × 5) = $1,500,000

But if the public round price is too high, the token becomes overvalued, leading to early sell-offs.

Too low, and early investors might dump at launch.

LIVE NOW: Join our spaces on how to market when the market isn’t marketing

https://x.com/i/spaces/1OdJrDdPjrlKX

SIMD-0228 is set to change Solana’s economic model, significantly reducing inflation by decreasing block rewards.

With 67.9% of votes in favor so far, it looks like it will pass, although half of the validators haven’t voted.

Stay tuned for our article next week going into great detail on the topic.

Source

Solana’s Tokenomics Shift: SIMD-0228 Explained

Tldr: token issuance will change based on % of supply staked.
• <50% = more emissions
• >50% = less emissions

Read more details and our analysis:
https://x.com/SimplicityWeb3/status/1900131283570688116

A common mistake in crypto fundraising is treating tokenomics like an equity cap table.

Equity = ownership in a company, valued by its financials.

Tokens = units of value in an ecosystem, driven by utility and demand.

Read the full analysis in our research article:
https://www.simplicitygroup.xyz/blog/e-vs-t

These projects have been deemed as some of the most outstanding tokenomics and incentive designs on Solana by Solana Compass users.

We analyzed their economies to determine what makes them stand out:

https://x.com/SimplicityWeb3/status/1901517608471363700

Token pre-launch valuation is tricky. Market cap doesn’t exist yet, and hype can distort real value.

Best approach? Prioritize the quantifiable.

✅ How much will users save by holding the token?
✅ What fees, rewards, or perks does it provide?
✅ What’s the estimated number of users?

Bad approach? Overestimating the unquantifiable.

❌ Speculation
❌ Social hype
❌ Vague narratives

Too many tokens launch at inflated prices based on hype, only to crash when real utility doesn’t match expectations.

Read more