Hacker News Reader

Comment by felipeccastro | Hacker News Reader

a) they could use ETH, but if you launch your own token you get two advantages:

- funding (ICO) - an economic incentive for attracting early users (give tokens for using your app in the promise that they will be worth more in the future)

b) if a user earns tokens that value over time, that's a huge win: imagine if all the time you spend on apps today, generating valuable data to a few companies, would generate in turn some of these tokens back to you?

Besides, what do you mean by "closed" exactly? The data being on the public blockchain should actually encourage integration by default. For example, several new dapps are being built on top of IPFS for data, using uPort for identity, Aragon for governance, etc.

View on HN

a) Or... wait for it... they could ask for payment in crypto, fiat, whatever, rather than printing their own chuck-e-cheese tokens. Yes, we get it, ICO allows the DAPP to fund itself, and it's a great value prop for the founders, because they can raise capital on the strength of a 15 page paper, as opposed to having real users.

b) "closed" means literally useless outside. Can you use your Cobinhood tokens at any other exchange? No, it's because Cobinhood tokens are only good for consuming the features of Cobinhood.

did anyone mention "These tokens serve as scarce resources that can be regulated and governed to more closely align with the functionality of a dapp" ?

a) what about the economic incentives for early users? That is a pretty huge deal too, even if ICO funding wasn't possible.

b) it's not literally useless outside, you just have to exchange it for other coins to use it outside. Isn't that how cash in most countries work too? Besides, remember there's far less friction in exchanging app-specific tokens by another coin than there is in exchanging cash today.

Even if app-specific tokens do not become standard in the future, it's an interesting idea worth exploring. But the whole point is how different kinds of business models can be created due to the decentralized nature of blockchain, this is just one of them.

Regarding your b):

Yeah, you can trade your Cobinhood tokens for Binance coins, but this is an artifact of the fact that each built a closed ecosystem. If both platforms used the same currency (ETH, USD, whatever), then there'd be no need or the inconvenience to trade tokens around.

Also, note, not all dapp tokens have liquid secondary markets, so I'd argue that it's almost an exception that your dapp tokens can be monetized externally

Reply on news.ycombinator.com