The Cost of Not Having a Native Token for Your Game's Chain

No native token creates a value sink. Every transaction fee paid in ETH or another base-layer token is pure value extraction, sending capital to Ethereum validators or Solana stakers instead of accruing to your game's ecosystem.

You subsidize competitors' security. Using a general-purpose L2 like Arbitrum or Optimism means your game's activity directly funds the infrastructure for your rivals, creating a perverse economic incentive.

The chain becomes a cost center, not an asset. Without a token to capture fees, the blockchain is a pure operational expense. This model inverts the Axie Infinity/Ronin playbook, where the chain's tokenomics fund ecosystem growth.

Evidence: Ronin's RON token generates over $1M in monthly protocol revenue from its native DEX, Katana, directly funding ecosystem grants and development.

Gas is your monetary policy. On a shared L2 like Arbitrum or Optimism, your game's transaction fees are priced in ETH. This creates a volatile, external cost base you cannot control, directly impacting player retention and microtransaction economics.

You subsidize your competitor's congestion. When another dApp on your shared chain causes a gas spike, your players pay the price. This is a direct economic leak to external actors, unlike the circular economy of a dedicated chain with a native token.

Native tokens enable targeted subsidies. Projects like Immutable zkEVM use IMX for gas fee abstraction, allowing developers to sponsor player transactions. This creates a captive economic flywheel where fee revenue can be recycled into ecosystem growth.

Evidence: The 90%+ gas fee subsidy rate for users on chains like Polygon zkEVM CDK demonstrates that controlling the gas asset is the primary tool for managing user onboarding costs and developer incentives.

You are hostage to L1 gas. Your game's user onboarding and microtransaction viability are dictated by the volatile, often prohibitive, gas fees of the underlying chain like Ethereum or Solana. A sudden network congestion event on Arbitrum or Optimism will price out your players.

You are hostage to the sequencer. The L2's centralized sequencer, whether Arbitrum, StarkNet, or zkSync, controls transaction ordering and fee capture. This creates a single point of failure for user experience and prevents your game from capturing its own economic flow for reinvestment.

You are hostage to the governance token. The L2's native token (e.g., ARB, OP) governs protocol upgrades and revenue allocation. Your game's infrastructure roadmap is subject to the political whims of a DAO with misaligned incentives, prioritizing DeFi over gaming-specific optimizations.

Evidence: Games on Ronin, which uses the RON token for gas, demonstrate order-of-magnitude lower fees and predictable economics compared to games deployed on shared, DeFi-saturated L2s where gas is a derivative asset.

Native Token as a Sink: A dedicated token creates a closed-loop economic flywheel. In-game assets and fees burn the token, creating deflationary pressure that directly rewards player engagement and asset holders, a mechanism impossible with a pure gas token like ETH.

Protocol Revenue Capture: Without a token, all value accrues to the underlying L1/L2 (e.g., Arbitrum, Optimism). Your game subsidizes their security budget while forfeiting the ability to fund development via token treasury or community incentives.

Counter-Argument: Liquidity Fragmentation: The standard critique is that a new token fragments liquidity. This is a solved problem. Aggregators like UniswapX and intent-based bridges like Across abstract this complexity for the end-user.

Evidence: Games like Parallel and Pixels demonstrate that native token economies drive higher user retention and LTV than pure NFT models, as the token aligns long-term player and protocol incentives.