In the world of blockchain and Web3, one of the hottest topics right now is the Appchain revolution. An appchain, or application-specific blockchain, is designed to serve the needs of a single project or ecosystem. Unlike general-purpose blockchains like Ethereum or Solana, an appchain is tailored for one app, giving developers full control over performance, fees, and governance.
But as more projects move toward appchains, a question arises: Do all projects really need their own coin? While many blockchain startups rush to launch tokens, not every project benefits from it. In this post, we’ll explore the advantages of appchains, the role of native coins, and whether creating a new token is truly necessary.
What is an Appchain?
An appchain is a blockchain dedicated to a specific application. Instead of competing for resources on a shared network, the app gets its own environment with customizable features. Popular frameworks like Cosmos SDK, Polkadot’s Substrate, and Avalanche Subnets make it easier for developers to launch appchains.
Appchains allow projects to:
∎ Control transaction fees.
∎ Customize governance rules.
∎ Improve scalability by avoiding network congestion.
∎ Enhance user experience with faster, cheaper transactions.
This flexibility is why appchains are gaining popularity among DeFi protocols, gaming platforms, and even enterprise solutions.
Why Projects Launch Their Own Coin
Most appchains come with their own native coin or token. The reasons include:
- Transaction Fees (Gas): Coins are often required to pay for network activity.
- Staking and Security: Tokens can incentivize validators or delegators to secure the network.
- Governance: Token holders get voting rights to shape the future of the project.
- Fundraising: Many projects launch coins through ICOs, IDOs, or airdrops to raise money and attract users.
Clearly, having a token brings utility—but it’s not always necessary.
The Downsides of Having Too Many Coins
While launching a coin may sound appealing, it comes with challenges:
∎ User Confusion: With thousands of tokens already in circulation, adding another one may overwhelm users.
∎ Liquidity Issues: New coins often struggle to find enough liquidity on exchanges, making trading difficult.
∎ Speculation Over Utility: Many tokens lose value quickly because people buy them for hype, not long-term use.
∎ Extra Development Costs: Managing a coin requires exchanges, wallets, and security audits, adding complexity.
For some projects, focusing on product adoption without introducing a coin may be a smarter choice.
Do Projects Really Need Their Own Coin?
The answer depends on the project’s goals.
☐ Yes, if:
- The appchain requires staking and validator incentives.
- The project aims for full decentralization with governance by the community.
- The coin provides real, ongoing utility within the ecosystem.
☐ No, if:
- The project can function using an existing blockchain’s coin (e.g., ETH, ATOM, or DOT).
- The team is not ready to manage liquidity, security, and tokenomics.
- The coin would only serve as a fundraising tool without real use cases.
For example, some appchains on Cosmos use ATOM or USDC for fees instead of launching their own coin, simplifying the user experience.
The Future of Appchains and Coins
As the Appchain revolution continues, we may see a hybrid future where some appchains launch tokens while others rely on shared ecosystem coins. Interoperability solutions like IBC (Inter-Blockchain Communication) are making it easier for projects to connect without needing separate coins.
Ultimately, the success of an appchain doesn’t depend on whether it has its own coin—it depends on whether the project delivers real value to users.
The appchain revolution is reshaping the blockchain industry, offering customization and scalability like never before. However, not every project truly needs its own coin. For some, launching a native token creates opportunities for governance, incentives, and fundraising. For others, it adds unnecessary complexity and risks.
Before creating a token, projects should ask: Does this coin solve a real problem for users, or is it just a short-term hype strategy?
The blockchain future will likely favor projects that focus on sustainable value, not just token launches.