Treeverse's $END token officially went live for claiming on July 4, and opened for trading just yesterday. Backed by Endless Clouds and community icon Loopify, the token had been long-awaited by fans of the upcoming anime-style MMORPG. With a circulating supply of 31.1% at launch and a healthy dose of goodwill from NFT holders and early backers, hopes were high during the launch. 

Unfortunately, they were also short-lived.

The token debuted with an FDV of around $30 million, but within just two hours of trading, $END plummeted below a $10 million FDV. A cascade of sell pressure from airdrop participants overwhelmed the market, leaving many disappointed with a familiar narrative: that Web3 gaming tokens almost always dump after launch. But the real question isn't "Why did this happen again?". Rather, it's: Why does this keep happening? And more importantly, should we be doing it differently?

The Pattern Runs Deeper Than Just Treeverse

To be clear, Treeverse didn't commit any glaring missteps. If anything, Loopify and the Endless Clouds team were refreshingly open about their journey. But this wasn't an isolated case.

In Wolves DAO Files #30, published in early 2024, the team broke down the dominant playbook for gaming token launches, which included NFT-gated rewards, play to airdrop campaigns, early presales, and public listings. The takeaway? Most launches follow the same pattern: initial hype, a massive surge at TGE, then a sharp 60–90% drop as airdropped users and early buyers rush to exit. The Wolves DAO team made it clear that if your token is distributed as a reward with no real demand behind it, it gets dumped. Extra mechanics like staking or token-gated quests rarely change the outcome. They're seen more as band-aids than real fixes.

Adding vesting, staking, or token-gated quests doesn't change that outcome. In practice, these mechanics feel like duct tape on a broken system.

Decrypt's data backs this up. In early 2024, six gaming tokens were in the crypto top 100. Today? None. Overall sector value is down 68% year-over-year, despite dozens of new launches.

Meanwhile, Cointelegraph explains how market makers worsen things. In many cases, tokens are loaned to market makers ahead of launch to provide liquidity. But those tokens often get sold early, building up off-chain inventory that gets dumped post-TGE. With little real demand to support the price, even good projects get caught in a downward spiral.

If almost every token launch ends in a nosedive, maybe it's time we stop and ask: Do we even need TGEs? Or at least, do we need to do them this way?

What Experts Are Suggesting

Thankfully, some of the experts calling out the flaws are offering ways forward. Across Wolves DAO, Cointelegraph, Decrypt, and academic circles, several ideas are gaining traction. These aren't magic fixes, but they point toward tokens that are earned, used, and respected, not just farmed and dumped.

So far, there are six potential solutions:

1. Anti-Dumping Clauses: Add smart contract rules that prevent massive token sales in the first few weeks. This includes transfer limits or even penalties for early outs.

2. Engagement-Based Unlocks: Don't give tokens for free. Let players unlock them by clearing hard content, winning tournaments, or burning NFTs, something that requires effort.

3. Treasury-Controlled Liquidity: Instead of seeding DEX liquidity day one, let the team or DAO drip it in over time, based on actual user growth.  

4. Burn-to-Upgrade Systems: Require players to burn tokens (or items) to craft higher-tier gear or access new levels. This creates long-term demand and sinks. 

5. Status Over Payouts: Tokens shouldn't just unlock money, they should unlock perks. Cosmetic gear, access to exclusive communities, or voting power can drive holding behavior. 

6. Infrastructure Rewards (ServerFi): Instead of giving emissions to grinders, reward players who support the game infrastructure. This can include those who host servers, moderate content, or supply liquidity. 

Let's dig deeper into this last one, because it's gaining attention for a reason.

What Is ServerFi?

In 2024, Yale researcher Pavun Shetty published a paper titled "ServerFi: A New Symbiotic Relationship Between Games and Players." The core idea is that web3 gaming rewards are too open-loop as players do tasks, get tokens, and just leave. ServerFi tries to change that by making players partial owners of the ecosystem.

Here's how it works:

1. Earn Lottery Chances, Not Tokens: Instead of handing out tokens, players earn draw tickets when they add real value, whether by winning games, running servers, or supporting liquidity.

2. Win Fragments → Forge NFTs: Winning a draw gives you a random "fragment." Collect a full set and you can craft an NFT that represents a stake in the game's ecosystem.

3. Stake NFT for Revenue Share: That NFT gives you passive income from marketplace sales, battle passes, and other in-game revenue streams, if you stake it.

4. No TGE Needed: Because everything is earned over time, there's no huge launch event. No day-one pump, no day-two dump.

The results? In their simulations, the ServerFi model grows user contribution more steadily than systems that offer continuous rewards for high-rentention players. Everyone sees a path to ownership, even for casual gamers.

More importantly, it shifts the focus from extracting value to building it.

Why It Matters

ServerFi flips the usual reward model on its head, focusing on long-term alignment rather than short-term gains.

The supply is capped by design, since fragments are burned during synthesis. This helps control inflation and prevents runaway emissions.

At the same time, the system creates a climbable ladder, giving smaller wallets a real chance to earn ownership through steady play and contribution.

Because rewards are tied to infrastructure instead of speculation, there's no exit pressure. Players aren't rushing to sell, they're building something that lasts. 

And perhaps most importantly, it fosters true co-ownership. Stakeholders have a reason to stay engaged, maintain the ecosystem, and see it grow over time.

Even YBB, a web3 fund, sees this as a way to detox from Ponzi optics. According to the team, ServerFi "further decentralizes the economic and systemic structure, similar to how the protagonist in Ready Player One earns ownership by completing the game."

Of course, this model still needs to feel fun. If players start feeling like DeFi farmers, we've lost the plot. But the concept of build-and-own instead of grind-and-dump feels like a step forward.

So, Should We Still Have TGEs?

That's the hard part.

For many studios, the TGE is a lifeline. It's how you raise funds, attract partners, and get noticed. But right now, that moment is almost always followed by a crash, and the data is too loud to ignore.

So maybe the solution isn't to kill the TGE entirely. Maybe it's to push it later in the timeline, after the game proves it can retain players. Maybe it's to make the TGE invite-only, gated by playtime or contributions. Or maybe the "token" shouldn't be tradeable at all until it becomes something worth holding.

What a Healthier Model Could Look Like

Imagine a new web3 game doing this instead:

- No public TGE until the core game hits 30-day retention goals.
- Tokens earned via milestones, not handed out.
- NFTs synthesized from token fragments, burning supply as they go.
- Liquidity added slowly, managed by the treasury.
- Anti-dump caps for whales during launch windows.
- Cosmetic and governance perks for token holders, not just payouts.

Would it work? Maybe. But it's a more grounded approach than hoping the next launch doesn't dump, despite every sign it will.

All in all, Treeverse's $END token isn't a failure. If anything, it highlights how deeply entrenched the current system has become, and how urgently it needs rethinking.

Web3 gaming is still in its early stages. But we now have clearer data, stronger tools, and more thoughtful frameworks than ever before.

The road ahead may not be simple, but focusing on long-term value over short-term momentum could be the shift web3 gaming needs.