Thread by @tokenomicsdao

As an investor in the #crypto space, there is one key decision metric for buying a #token: the utility.

What are the most common examples of utility?

What is #utility and how do we evaluate it?

Utility is what gives a token a use case. The most relevant use cases are:

-Governance: $UNI, $COMP, $MKR
-ROI: Pays yield: $SUSHI ($XSUSHI)
-Use as Collateral: $ETH, $DOT
-Access to service (SaaS): $LINK, $FIL
-Status: $BANK

The most relevant use case is governance; nearly all tokens provide governance rights.

Popular examples are $UNI, $COMP, and $MKR.

This is because they are the native tokens of their protocols, and users can participate in governance discussions and voting.

Passive income is another significant demand driver.

$SUSHI is a good example.
Owners of the token can lock their $SUSHI and receive $XSUSHI, which will appreciate in value due to fees from the exchange platform of Sushi.

DeFi is another essential option for token use cases.

There are a lot of opportunities to use $ETH to borrow, lend, add liquidity, etc.

For example, users can deposit their $ETH as collateral to @MakerDAO to borrow $DAI.

Accessing a service through tokens is also popular.

@chainlink is an oracle protocol that transmits real-world data on-chain. Oracles are a decentralized layer between real-world data and the blockchain.

To use Chainlink, users have to pay $LINK tokens to oracles.

Last but not least, there are status tokens such as @banklessDAO’s $BANK token.

You need to own it to become a contributor to the DAO. It is a mix of membership fee and status symbol.

The more $BANK you own, the more serious you are about Bankless DAO.