Why Appchain Bootstrapping Requires Predatory Tokenomics

The Problem: Launching with zero TVL is a death sentence. The Solution: Directly incentivize users to bridge assets from a dominant chain like Ethereum or Solana.

• Key Tactic: Offer 2-5x higher yield on bridged stablecoins or blue-chip assets.
• Key Metric: Target $100M+ TVL migration within the first 90 days.
• Entity Example: Sushiswap's famous attack on Uniswap, Avalanche's $180M+ liquidity mining avalanche.

The Problem: Users have no reason to stay after the initial incentive. The Solution: Implement a points system that promises a future token airdrop, locking in engagement.

• Key Tactic: Obfuscate the tokenomics; make the reward formula opaque to maximize farming behavior.
• Key Metric: Drive >50% of daily active addresses from airdrop hunters.
• Entity Example: LayerZero's omnichain airdrop farming, Blast's native yield + points model.

The Problem: Users won't pay for unproven performance. The Solution: Temporarily subsidize transaction costs to zero (or even pay users), creating a price vacuum.

• Key Tactic: Fund this via token inflation or VC war chest, creating unsustainable negative unit economics.
• Key Metric: Achieve ~$0 gas fees and sub-2s finality to outpace incumbents.
• Entity Example: Polygon's early days, Arbitrum Nitro's initial surge, Solana's historical fee market.

Without a native token, you're competing for TVL with Ethereum and Solana. A generic token is just another farm-and-dump asset. The solution is to embed the token into the chain's core security and utility, creating a positive feedback loop where usage directly secures the network and accrues value.

• Key Benefit: Token becomes a work token for sequencer rights or data availability.
• Key Benefit: Native fees and MEV are captured and redistributed to stakers, not leaked to Ethereum validators.

Rollups on Ethereum or Celestia outsource sequencing, leaking value. An appchain with a predatory token can capture this value. The token grants the right to run the sequencer, making it a cash-flow generating asset. This is the dYdX v4 model.

• Key Benefit: 100% of sequencer fees/MEV are captured on-chain.
• Key Benefit: Creates a powerful incentive for validators to prioritize chain security and performance.

Bridging assets from Ethereum via LayerZero or Axelar is expensive and slow. A token-native chain can subsidize this cost as a user acquisition strategy. Use inflationary token emissions to pay for gas rebates and bridge fees, directly lowering the entry barrier.

• Key Benefit: Users experience near-zero-cost onboarding.
• Key Benefit: Deflationary pressure on the token is offset by new user growth and fee capture.

On a shared L2 like Arbitrum or Optimism, you're at the mercy of their governance and upgrades. An appchain with its own token governs the entire stack: EVM version, fee market, precompiles. This allows for protocol-specific optimizations impossible on general-purpose chains.

• Key Benefit: Custom precompiles for complex logic (e.g., order book matching).
• Key Benefit: Can implement native account abstraction without waiting for L1/L2 roadmaps.

Bootstrapping a decentralized validator set is expensive. A high-inflation token emission schedule is the only viable tool to pay validators before the chain generates sufficient fees. This is a necessary predatory phase to achieve credible neutrality and security.

• Key Benefit: Attracts professional validators from Cosmos and Polkadot ecosystems.
• Key Benefit: Aligns validator incentives with long-term chain growth from day one.

The endgame is transitioning from inflationary subsidies to fee-driven sustainability. The token must be designed to capture value from every transaction, block, and cross-chain message. This turns the appchain from a cost center into a self-sustaining economy, achieving escape velocity from the Ethereum gravitational pull.

• Key Benefit: Sustainable tokenomics replace predatory emissions.
• Key Benefit: Creates a defensible moat against forks and general-purpose L2 competitors.