#TokenBurning #BTCvsMarkets *🪙Tokenomics 101: What is It and Why It's Important*
> Tokenomics = Token + Economics
Tokenomics covers things like how the token is created, distributed, used, and what affects its value.
Good tokenomics helps a project grow and stay strong. It is the foundation that keeps a crypto project running. No matter how hyped the marketing is, if the token model is weak, the project won’t survive.
If you're thinking of investing, checking the tokenomics is a very wise move.
*✅ Tokenomics Checklist: Key Elements to Study*
*Supply*
Total supply is how many tokens will ever exist, while circulating supply is how many are in use now. A limited supply can increase value, while unlimited minting can cause inflation and price drops.
_🚩 Undefined supply can lead to price manipulation by the project._
*Token Distribution*
Token distribution shows who gets the tokens and how they're spread out. If a small group holds most of them, they could dump and crash the price. A fairer spread usually means less risk of sudden sell-offs.
_🚩 A few wallets controlling most tokens can lead to manipulation._
*Token Utility*
Tokens need a purpose — like payments, staking, or governance. The more useful a token, the higher its demand.
_🚩 No real use for the token can lead to price speculation and a crash once the hype fades._
*Incentives & Token Burns*
Incentives encourage people to keep their tokens, like earning rewards for staking. Token burns reduce the total supply by permanently removing tokens, which can help increase value.
_🚩 No incentives or token burns can lead to price instability and lack of long-term value._
*Hype vs. Fundamentals*
Flashy marketing and bold promises don’t guarantee a project’s success. A strong tokenomics model should be transparent, well-structured, and focused on long-term growth.
_🚩 If a project relies on hype and promises "guaranteed" returns without a clear roadmap, be cautious._
> A solid understanding of tokenomics is your best defense. Take the time to understand the
