New a16z research highlights why stable, ecosystem-locked tokens may drive long-term adoption
A new report from venture capital firm a16z argues that crypto’s evolution may depend on a largely overlooked class of tokens known as arcade tokens — digital assets designed not for speculation but for use. Similar to airline miles or in-game currencies, these tokens hold stable value within a specific ecosystem and enable users to participate in functions built directly into the platform.
According to the report, arcade tokens could become a critical building block for developers seeking to build sustainable digital economies without relying on volatile market speculation.
Arcade Tokens: The Digital Equivalent of Airline Miles
Arcade tokens are designed to be ecosystem-locked, allowing users to redeem them for services, rewards, or access within a single platform. a16z researchers Scott Duke Kominers and Eddy Lazzarin say this structure creates predictable economic behavior and clear utility.
“Just as stablecoins unlock new forms of commerce, and network tokens enable decentralized value-sharing and governance, arcade tokens can power digital economies at scale,” the authors noted.
Unlike typical crypto assets, their value is programmatically bounded, ensuring price stability and making spending decisions easier for users.
This model helps minimize speculation — a major obstacle that often distorts early-stage blockchain ecosystems.
Real-World Usage: Blackbird’s $FLY Token as a Case Study
One of the highlighted examples is Blackbird, a hospitality technology platform that launched a Web3 payments system for restaurants in 2024. Its $FLY token acts as a reward mechanism, giving users spendable value across participating restaurants.
The report explains that the token’s redemption system runs on a dedicated blockchain layer, allowing the network token to handle security and incentives while the arcade token focuses on customer engagement.
a16z notes that other industries may adopt similar models.
A decentralized computing network, for instance, could compensate providers with a network token while using an arcade token to build user incentives and strengthen network effects.
Why Builders May Choose Arcade Tokens Over Stablecoins
Stablecoins offer predictable pricing, but arcade tokens provide additional flexibility.
Issuers can mint tokens on demand to support growth, fund grants, or incentivize developers — all while ensuring users remain inside the ecosystem rather than moving funds elsewhere.
The design supports spend-centric economies, loyalty programs, and physical-world integrations where stable pricing and easy accounting matter.
Not a Universal Solution — But a Powerful Tool
a16z stresses that arcade tokens are not suitable for every project. Platforms built around speculation or ecosystems already supported by established network tokens may not benefit from them.
However, for emerging digital economies, loyalty-driven applications, and real-world integrations, arcade tokens may represent a crucial step forward.
As blockchain developers shift focus from speculative assets to usable digital value, arcade tokens may offer a clearer path to sustainable growth. Their stable, purpose-built design provides a foundation for predictable user behavior and long-term ecosystem development.
According to a16z, the next wave of crypto adoption may be powered not by hype—but by tokens built for real utility.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.