For some time now, I’ve been quietly working on a book called Tokencraft: The Art and Science of Designing Tokens That Work.

With things quiet over the holidays, here’s a small sneak peek.

I’m not writing it to evangelize, but to orientate. To reveal how to reason about tokens as incentive systems and economic machinery, not vibes, narratives, or price charts.

It’s for builders trying to innovate out of inherited constraints, and for investors trying to understand what actually creates durable value in crypto.

Yesterday, I shared a draft of the first chapter.

Below is a succinct draft of the fifth one, How Tokencraft Escapes the Investor Priesthood: And Frees Builders From the Fleece-Vested Gatekeepers

Say you’re starting a company the old-fashioned way. You have an idea, a laptop, and a mild panic attack. So you do what founders are trained to do: you go beg.

You shuffle into boardrooms filled with Very Serious People in fleece vests and ask them for money to build “the future.” In exchange, you hand over a chunk of your company before it’s even out of the womb. They give you a check and a promise to “be helpful,” which usually means forwarding a tweet about grit.

Meanwhile, your first users—the ones brave enough to try your half-broken product—get nothing. Your early contributors—designers, moderators, the weirdos in Discord who treat your dream like it’s their life’s mission—also get nothing. Value flows one way: up the cap table. That’s the Web2 model. The one we were taught. The one we pretend is normal.

Crypto still mostly relies on this model. But it doesn’t have to. Because good token design has the power to blow it apart and price contribution directly: usage, liquidity, security, governance, coordination itself. When you can account for those things continuously, you no longer need to pre-sell ownership upward before the system exists.

To be sure, I’m not interested in making moral critiques of venture capital. VC has played a necessary role. It priced risk and coordination when nothing else could. But those conditions are not universal. They don’t apply everywhere. And I would argue that tokens, rather than erasing the entire model, can help make it better for all parties.

…

In a traditional startup, investors, workers, and users are separate castes. Investors provide capital. Workers provide labor. Users provide revenue. And each group is compensated on wildly different scales. Tokens make a different arrangement possible. Suddenly, anyone who contributes—even a random coder halfway across the world at 2 a.m.—can own a slice of the network’s future. Not stock options buried under vesting cliffs. Not handshake promises. A liquid, transferable claim on what they help build.

This is the seed that splits the stone: the network becomes the investor.

You don’t NEED Sand Hill Road. You don’t need to kiss the ring of someone who’s never touched your product. The people who build the thing can own the thing. The people who secure it can own it. And the people who use it can own it too. Venture capital remains an option—but no longer a requirement.

We’ve already seen this in action. Bitcoin miners earned ownership through work. Early Ethereum contributors accumulated ETH when it was cheap, aligning labor with upside. DeFi protocols reward developers, liquidity providers, and communities. Airdrops distribute ownership to users who were never accredited, never insiders, never invited to the table. Tokens create the possibility of credibly neutral systems where contribution equals ownership. Whether projects use that possibility well is another question—and part of why Tokencraft matters.

Tokencraft’s most powerful promise is narrowing the gap between contribution and ownership. It makes it possible for participants to hold stake as they help create value within the network, rather than long after that value has already been captured. Imagine if Uber drivers, early YouTube creators, or Facebook’s first users had shared in the upside they helped generate. Most platforms—from Airbnb to Wikipedia—were built by contributors who received little of the value they created. Tokencraft rewrites that bargain in ways equity structures were never built to support.

Tokens also change early-stage survival. Startups are almost always broke; that’s a law of nature. Cash is scarce, but upside isn’t. Tokens let founders compensate contributors with a sliver of tomorrow instead of dollars they don’t have today. That’s how Bitcoin bootstrapped itself: no payroll, no HR, no CEO—just one incentive. Secure the network now, and you own part of whatever it becomes. That incentive built an entire monetary system from scratch.

And it’s not just companies or networks. Tokens let individuals pull future value forward too. Students, artists, athletes, researchers—anyone whose value lives in the future can fund themselves the way startups do.

A student tokenizes a slice of future earnings instead of signing away decades to loan servicers. A musician sells tokens tied to touring or streaming revenue, turning fans into early backers. An athlete tokenizes future contract income. A researcher issues tokens linked to future IP instead of begging grant committees.

Tokens also make ventures, both large and small, global from hour one. A Web2 startup begins as a tiny town—five people, coffee, and optimism. A token network begins as a global city: thousands of potential contributors, instantly aligned not by contracts, but by incentives. Forget altruism (everyone else has). This is coordination. A clean bribe that turns strangers into collaborators.

Tokens can also rewrite the time equation. Equity gets priced a handful of times—Series A, Series B, maybe an IPO. Tokens get priced every second of every day. It’s brutal. It’s honest. The market tells you immediately whether anyone cares. You listen faster, iterate faster, or end faster—which is also progress.

Good token design by way of Tokencraft also makes dilution explicit. The entire supply curve—today, tomorrow, ten years out—is written into code. Equity dilution, by contrast, is endless negotiation: new rounds, new terms, new preferences, new carve-outs. Dilution as a lifestyle.

Here’s one way to make the distinction concrete: Equity is a governance claim mediated by people. Its rules exist, but they flex under pressure. In moments of stress, boards and insiders can change outcomes quickly—dilution, repricing, restructurings—often in ways that are legal, rational, and devastating to minority holders. Equity feels durable until discretion suddenly collapses into a few hands.

Tokens are procedural claims governed by pre-committed mechanisms. Supply changes, emissions, and governance actions must move through visible rules and thresholds agreed upon in advance. Bad decisions can still happen, but the pathway is constrained and usually legible before the damage is done.

Equity asks you to trust decision-makers under stress. Tokens ask you to trust the structure before stress arrives. That’s why equity feels solid until it suddenly isn’t, while tokens often feel fragile but reward you for understanding the structure ahead of time. Neither eliminates power or bad outcomes; each simply chooses where those risks live—inside people, or inside rules.

In an age of Tokencraft, equity remains, but under greater discipline. As tokens show that large-scale coordination can run on pre-committed rules rather than discretionary control, equity will increasingly have to explain where flexibility is genuinely required, rather than simply assumed.

Think of it the way machinery evolved. Early systems demanded constant human adjustment. Modern machines embed rules so they behave correctly under ordinary stress without operator heroics. Manual control still exists for edge cases, but it’s no longer the default. Tokens apply the same shift to coordination: rules first, discretion second. Equity retains the clutch where automation would introduce excessive rigidity.

The result? Not total replacement, but pressure: tighter covenants, clearer dilution paths, harder guarantees, and fewer blank checks for “emergency” decisions. Tokens introduce a competing standard for economic credibility, and equity adapts by becoming more rule-bound where trust alone no longer suffices.

In the old world, ownership arrived late and discretion arrived early. Capital was invited in first, participation second, and contributors waited to see whether the rules would still hold when pressure appeared. Tokencraft has the potential to invert that order.

If you help build the village, you should share in its upside. It’s really that simple. Tokens are the first technology able to hard-code this principle into reality—globally, transparently, and at scale.

Tomorrow, I’ll share the sixth chapter.