L1 Token Guide – Everything You Need to Know

When working with L1 token, the native cryptocurrency that powers a base blockchain network. Also known as base layer token, it secures the chain, pays transaction fees, and incentivizes validators. Ethereum, a leading L1 blockchain with its ETH token, shows how a native coin can enable smart contracts and a thriving DeFi ecosystem. Bitcoin, the original L1 token that introduced decentralized digital money, proves the value of a robust, permissionless base layer. Finally, Tokenomics, the economic model governing supply, issuance, and utility of a token, determines how an L1 token behaves over time.

Key Aspects of L1 Tokens

The core role of an L1 token is to enable transaction fees on the network – every move you make, from a simple transfer to a complex smart‑contract call, consumes a small amount of the native coin. Because fees go to validators or miners, the token also aligns incentives and protects the chain from spam attacks. This economic feedback loop is why tokenomics matters: a well‑designed supply schedule can keep fees affordable while rewarding security providers.

Airdrops often distribute L1 tokens to early users, rewarding community members and jump‑starting network effects. Projects announce airdrop eligibility criteria – hold a certain amount of the native coin, interact with a testnet, or complete a KYC step. When you receive an L1 token airdrop, it instantly becomes tradable on most exchanges, giving you exposure to the network’s future growth. Our collection includes step‑by‑step guides on how to prepare for these drops and stay safe from scams.

Layer 2 solutions, such as rollups or sidechains, rely on the security of the underlying L1 token. They post aggregated transaction data back to the base chain and pay for that posting using the native coin. In turn, the health of the L1 token directly influences the cost and speed of Layer 2 operations. Understanding this relationship helps you evaluate whether a token’s price volatility will affect your DeFi strategies.

Beyond finance, L1 tokens fuel on‑chain governance. Holders can vote on protocol upgrades, fee adjustments, or fund community projects through treasury proposals. This democratic layer adds real‑world decision power to anyone who owns the native coin, turning passive investors into active participants. Many of the posts below explore governance case studies on Ethereum, Bitcoin, and emerging L1s.

Whether you’re scouting a new blockchain, comparing airdrop opportunities, or analyzing token economics, grasping the fundamentals of L1 tokens is essential. Below you’ll find deep dives into specific coins, security considerations, and practical tutorials that turn theory into action. Ready to explore the full list of articles? Dive in and start building a stronger crypto toolkit today.