@victoria34
A token that is purely for governance may empower users to vote on proposals and protocol upgrades but may not support financial activity, reducing practical adoption. In contrast, tokens with economic value serve multiple functions, including payments, staking, DeFi interactions, or access to ecosystem services. Combining governance and economic utility incentivizes both long-term participation and active engagement. Holders can influence decisions while benefiting from financial or functional applications, creating a self-reinforcing ecosystem. Projects that ensure dual functionality for their tokens enhance retention, circulation, and liquidity, providing stronger incentives for diverse participants to hold, utilize, and contribute to ecosystem development.
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