Everyone wants to argue NFTs vs tokens. The truth is: it’s the wrong question. The real question is what role each should play in a game economy. Because they’re not the same tool, and they were never meant to be. When people ask whether NFTs or tokens are the better foundation for game economies, the honest answer is that it depends. Different primitives serve different purposes. NFTs fit naturally with ownership and identity. They represent avatars, achievements, progression, and rare loot. They create memories and identity. They move slower, which adds friction. But friction can be healthy. It keeps people holding and thinking twice before flipping. The downside is that NFTs often trend toward zero when the game fails to launch or sustain momentum. Liquidity is thin, and once hype fades, the secondary markets dry up. Players can get stuck with assets that never find a buyer. Tokens fit naturally with velocity. They work for reward loops, daily incentives, crafting resources, leaderboard payouts, and marketplace liquidity. A fungible unit is simple to distribute and easy to trade. But without strong sinks and consistent demand, tokens spiral into sell pressure. And when players feel burned on a purchase because price moved downwards the next day, spend collapses. The truth is most native game tokens were never needed. They don’t tell you much beyond who is dumping that week. Still, when designed well, tokens can power systems that would be hard to run on NFTs alone. They can drive activity in ways NFTs cannot. Stables or chain tokens like ETH and SOL can sometimes replace the need for a native token entirely. They provide stability for payments and remove speculative baggage. Pixels shifting rewards to USDC is one clear example. NFTs, on the other hand, are signal. If they’re trading, it usually means the game has traction. If they’re dead, the game is too. At the same time, app tokens open up more control for developers and can unlock experiments that stables alone cannot. Hybrids like ERC-404 even allow NFTs and tokens to convert into each other. That adds liquidity while maintaining identity. But governance by token? Still a meme. Speculators do not make better designers. Most gamers have little interest in governance at all. A curated game council is more valuable than an open token vote. The strongest models we have seen keep it simple: - NFTs for ownership, progression, and identity. - Stablecoins or chain tokens for payments. - Native tokens only when the game loop truly demands it. The balance shifts depending on genre. An MMO with heavy trading can embrace token volatility as gameplay, while a casual shooter may only need skins as NFTs & payments in USDC. What emerges is not an “NFTs or tokens” debate, but a “what role should each play” discussion. NFTs excel where uniqueness and belonging matter. Tokens excel where speed and liquidity matter. Both can fail when bolted on without purpose. Both can work when used with intent. In the end, players do not care about perfect tokenomics or abstract arguments. They care about whether the assets they hold feel meaningful and whether the currencies they spend feel fair. NFTs feel like artifacts - what you remember, flex, and carry with you. Tokens feel like coins in your pocket. Useful, but not memorable. The best economies are those where each is used deliberately, not by default. That is the real foundation. This is derived from one of our Question of the Week discussions we have in discord, in true Wolves-style. Transparent, critical, constructive. Where do you sit on the debate - do you prefer NFTs or tokens?