How do coins/tokens based on a platform/protocol (Ethereum/Cardano) affect the parent coin (ETH/ADA)?


#1

I’m a bit new to cryptocurrencies (a few months in), and though I’ve searched for a simple answer to this question, I’ve yet to find one satisfactory.

Do (or how do) coins/tokens that are based on a platform/protocol, affect the main/native coin of that platform/protocol. So, for instance, there are a lot of ERC-20 coins/tokens. Do these in any way have an affect on ETH, and it’s price?

Thanks

EDIT: an hour with no response leads me to believe i’ve asked something incredibly stupid. Not surprising, on these topics I confuse easy.


#2

Hi,

Indeed a really successful platform which create lots of token could have a positive impact of the underlying native crypto-currency, because one has to first use and buy the latter to get some tokens.
But it also depends of the investors’ strategy, if the goal is to sell the tokens once it’s listed on exchanges, as we saw with some ERC20 tokens, then they could possibly also go out of that crypto and so lower the value.

Ethereum works fine for ICO, that’s his big use case for now, but he suffer from some initial design choices - made to evolve during time - which makes him not so scalable for the moment.
Having tokens in addition to the features we all are looking : scalability, choice to have some privacy, robust computation platform, well designed consensus and reasonable fees could have a much higher impact of the native crypto I think.