Last week we hosted our inaugural Re7 Social crypto social research day, with talks from Salvino, David Phillips, and Jacob Horne - founders who've iterated in this space more than most. One theme emerged: how asset-creation platforms capture value, or how value is captured in a world where the cost of creating tokens asymptotes to zero.

The idea I'm taking seriously after this research day can be expressed in one line: token pairing is a clean business model for asset‑creation platforms - pair every new asset in the platform token so every buy locks float upstream and mechanically lifts children assets downstream.

Blockchains have collapsed the cost of creating a tradable asset to basically zero. The explosion of the number of memecoins is an expression of the barriers lowering and precursor to the set of assets including everything: LP shares, startup equity, digital art, creator coins, agent tokens, and much more.

As an aside, some people look at this explosion and panic with the view that too many tokens makes returns impossible. The counter to this view is that in attention markets (short‑form content is the obvious analogy), more attempts widen the tails. That's like saying TikTok killed virality because there's too much content. The opposite happens: more attempts create bigger winners.

The question isn't whether asset creation will slow down (it won't). It's who captures the value when everyone becomes an asset creator.

The talks surfaced three dominant monetization strategies, each misaligned in their own way:

∗ The Bundler's Game (as told by Salvino): Anonymous deployers watch TikTok, scan Twitter, monitor Twitch streams to instantly spawn tokens for anything trending. They corner the supply early and sell into retail FOMO or snipers. It's lucrative ($54M+ in profits on Pump.fun alone in past 6 months) but parasitic. Less than 3% of participants on Pumpfun ever see meaningful wins, and it's in great part due to these sophisticated players. 

∗ Traditional launchpads: Simple game, let users deploy a token and take a fee, a % of the supply or both. The alignment issue with this model is that platforms are a classic case of adverse selection. Their terms mirror venture funds but worse so only projects that can't raise elsewhere show up. It's the lemons problem, with a token.

∗ Buyback programs: Both asset creators and platforms will try to monetize by increasing their own asset market cap through web2-inspired buybacks. This creates another alignment issue between the company's success and token value. Revenue buys back tokens instead of funding product or growth, ensuring either long-term holders or speculators lose.

And that's when the idea of pairing came into play: what if the platform's success was mechanically tied to every asset it creates?

In the past 12 months, several protocols on Base like Zora, FxHash and Virtuals have started exploring with a new business model: token pairing.

The intuition is that each new asset created on the platform pairs not to USDC/ETH/SOL, but with the platform's own token. Every buy triggers (behind the scenes, abstracted from the user) a double hop:

1. buy the platform token

2. swap the platform token for child asset

David summarized the visible effect as ‘two green candles for the price of one’ - crude, but directionally correct.

For the platform asset, demand for child assets locks more platform token supply in liquidity pools. In Zora's case, demand for creator coins creates a growing mountain of $ZORA removed from circulation, locked across thousands of creator markets.

The model works because it creates alignment between the top-level asset and the child assets and their holders, and the creators. Heet (Noice) calls it Internet Capital Alignment, a concept I prefer to its quasi-namesake Internet capital Markets.

First, it enables clean upstream value capture. Every successful child asset permanently locks platform tokens in liquidity pools. Success creates supply sinks. Jacob's data shows significant portions of $ZORA supply now locked in downstream liquidity, shrinking float through utility, not burning.

Second, strength flows down. When the platform token appreciates, every asset paired to it gets mechanically lifted. Early creators become evangelists, attracting more creators, which reflexively makes the platform better. The rising tide lifts all boats.

Third, it creates platform moats. Each successful asset makes the platform more attractive for new creators, creating a gravity well of liquidity and attention that becomes increasingly difficult to escape. The more people use the product, the better it gets. Network effects™️.

This model fits situations where the product is asset origination itself: social tokens (Zora), generative art (FxHash), agents (Virtuals), prediction markets, and more. The platform's value is its ability to spawn valuable children.

There are a couple of important additional considerations that stem from the fact that the pairing model introduces an element of leverage. Each buy is essentially counted twice. 

First, volatility requires management. The "two green candles" demo works because of low liquidity - this is a bug through, not a feature. This requires: a) deep base pools b) routing through your asset (initially painful for Zora) c) automated liquidity provision.

Zora uses an interesting deleveraging pattern: they increase the liquidity on child assets as they appreciate stabilizes price once they take off. Leverage on the way up, and stable price once we get there.

Second, alignment requires value. Financial alchemy only works if it creates good outcomes: more artists for FxHash, better forecasters for prediction markets, more self-reliant creators. At the core of the system there must be a high-quality product where users are willing to spend time and resources, for the sake of the product or its benefits.

Jacob pointed out that the price premium L1s held for being the native pairing asset is now up for grabs. I expect more asset-creation platforms to explore this. Until it's a common pattern, these projects should outperform in bullish markets. Net quote locked in downstream pools is the metric to watch.

The more ambitious implication: room exists for an internet-scale asset creation platform for culture. Whichever platform reaches this first at scale has a shot to become the asset for culture, the native internet currency. This could have been the directional bet behind Zuckerberg's Libra. Zora seems to be executing toward it now.

Lastly, as usual in crypto, we're ahead of the curve when it comes to financial engineering. But our products still fall short of broad adoption. A day like the one we spent gives me confidence as it's clear the people who can make it happen are going hard at it.

Last week we hosted our inaugural Re7 Social crypto social research day, with talks from Salvino, David Phillips, and Jacob Horne - founders who've iterated in this space more than most. One theme emerged: how asset-creation platforms capture value, or how value is captured in a world where the cost of creating tokens asymptotes to zero.

The idea I'm taking seriously after this research day can be expressed in one line: token pairing is a clean business model for asset‑creation platforms - pair every new asset in the platform token so every buy locks float upstream and mechanically lifts children assets downstream.

Blockchains have collapsed the cost of creating a tradable asset to basically zero. The explosion of the number of memecoins is an expression of the barriers lowering and precursor to the set of assets including everything: LP shares, startup equity, digital art, creator coins, agent tokens, and much more.

As an aside, some people look at this explosion and panic with the view that too many tokens makes returns impossible. The counter to this view is that in attention markets (short‑form content is the obvious analogy), more attempts widen the tails. That's like saying TikTok killed virality because there's too much content. The opposite happens: more attempts create bigger winners.

The question isn't whether asset creation will slow down (it won't). It's who captures the value when everyone becomes an asset creator.

The talks surfaced three dominant monetization strategies, each misaligned in their own way:

∗ The Bundler's Game (as told by Salvino): Anonymous deployers watch TikTok, scan Twitter, monitor Twitch streams to instantly spawn tokens for anything trending. They corner the supply early and sell into retail FOMO or snipers. It's lucrative ($54M+ in profits on Pump.fun alone in past 6 months) but parasitic. Less than 3% of participants on Pumpfun ever see meaningful wins, and it's in great part due to these sophisticated players. 

∗ Traditional launchpads: Simple game, let users deploy a token and take a fee, a % of the supply or both. The alignment issue with this model is that platforms are a classic case of adverse selection. Their terms mirror venture funds but worse so only projects that can't raise elsewhere show up. It's the lemons problem, with a token.

∗ Buyback programs: Both asset creators and platforms will try to monetize by increasing their own asset market cap through web2-inspired buybacks. This creates another alignment issue between the company's success and token value. Revenue buys back tokens instead of funding product or growth, ensuring either long-term holders or speculators lose.

And that's when the idea of pairing came into play: what if the platform's success was mechanically tied to every asset it creates?

In the past 12 months, several protocols on Base like Zora, FxHash and Virtuals have started exploring with a new business model: token pairing.

The intuition is that each new asset created on the platform pairs not to USDC/ETH/SOL, but with the platform's own token. Every buy triggers (behind the scenes, abstracted from the user) a double hop:

1. buy the platform token

2. swap the platform token for child asset

David summarized the visible effect as ‘two green candles for the price of one’ - crude, but directionally correct.

For the platform asset, demand for child assets locks more platform token supply in liquidity pools. In Zora's case, demand for creator coins creates a growing mountain of $ZORA removed from circulation, locked across thousands of creator markets.

The model works because it creates alignment between the top-level asset and the child assets and their holders, and the creators. Heet (Noice) calls it Internet Capital Alignment, a concept I prefer to its quasi-namesake Internet capital Markets.

First, it enables clean upstream value capture. Every successful child asset permanently locks platform tokens in liquidity pools. Success creates supply sinks. Jacob's data shows significant portions of $ZORA supply now locked in downstream liquidity, shrinking float through utility, not burning.

Second, strength flows down. When the platform token appreciates, every asset paired to it gets mechanically lifted. Early creators become evangelists, attracting more creators, which reflexively makes the platform better. The rising tide lifts all boats.

Third, it creates platform moats. Each successful asset makes the platform more attractive for new creators, creating a gravity well of liquidity and attention that becomes increasingly difficult to escape. The more people use the product, the better it gets. Network effects™️.

This model fits situations where the product is asset origination itself: social tokens (Zora), generative art (FxHash), agents (Virtuals), prediction markets, and more. The platform's value is its ability to spawn valuable children.

There are a couple of important additional considerations that stem from the fact that the pairing model introduces an element of leverage. Each buy is essentially counted twice. 

First, volatility requires management. The "two green candles" demo works because of low liquidity - this is a bug through, not a feature. This requires: a) deep base pools b) routing through your asset (initially painful for Zora) c) automated liquidity provision.

Zora uses an interesting deleveraging pattern: they increase the liquidity on child assets as they appreciate stabilizes price once they take off. Leverage on the way up, and stable price once we get there.

Second, alignment requires value. Financial alchemy only works if it creates good outcomes: more artists for FxHash, better forecasters for prediction markets, more self-reliant creators. At the core of the system there must be a high-quality product where users are willing to spend time and resources, for the sake of the product or its benefits.

Jacob pointed out that the price premium L1s held for being the native pairing asset is now up for grabs. I expect more asset-creation platforms to explore this. Until it's a common pattern, these projects should outperform in bullish markets. Net quote locked in downstream pools is the metric to watch.

The more ambitious implication: room exists for an internet-scale asset creation platform for culture. Whichever platform reaches this first at scale has a shot to become the asset for culture, the native internet currency. This could have been the directional bet behind Zuckerberg's Libra. Zora seems to be executing toward it now.

Lastly, as usual in crypto, we're ahead of the curve when it comes to financial engineering. But our products still fall short of broad adoption. A day like the one we spent gives me confidence as it's clear the people who can make it happen are going hard at it.