In crypto, every project wants to decentralize decision-making, but when you peel back the layers, many governance tokens are just noise. Take the Ampleforth project. It started with a single token, $AMPL, which introduced a novel elastic-supply mechanism. Then came $FORTH, a governance token that promised to give power to the community. Now, we have $SPOT, a so-called “stable asset” collateralized by $AMPL.

Here’s the question: why does a project with a working token need two more? The answer seems obvious. More tokens mean more hype, more speculation, and more chances for insiders to cash out.

Let’s break down why $FORTH and $SPOT are unnecessary and how they dilute the ecosystem’s value.

$FORTH Did Not Need to Exist

$AMPL’s elastic-supply mechanism was already an innovative way to maintain a stable unit of value without traditional collateral. The protocol adjusted supply to meet demand, creating a self-regulating system. Governance was not even on the radar during $AMPL’s early days, and the project was thriving.

Then, in 2021, the team launched $FORTH as a governance token. The pitch? Token holders could now vote on protocol changes, upgrades, and treasury management. But here is the issue: most decisions were already being handled effectively by the team. $FORTH did not introduce real decentralization but it introduced more complexity as well as fragmentation of liquidity.

$SPOT: Another Layer of Token Overload

Fast forward, and now we also have $SPOT, a stable asset designed to function as a “better $AMPL.” But wasn't $AMPL already the solution to volatility? $SPOT is collateralized by $AMPL, so the two tokens are inextricably linked, yet $SPOT claims to solve problems that were not even problems to begin with.

$FORTH, as a governance token, should have been enough to handle $SPOT’s integration. Instead, $SPOT adds another token to the mix, fragmenting liquidity and creating more confusion for investors. Rather than consolidating value, Ampleforth seems to be spreading itself thin.

Governance Tokens: A Whale Playground

One of the biggest issues with $FORTH is that it does not deliver meaningful decentralization. Like many governance tokens, it is vulnerable to low participation and whale dominance. In most governance systems, a small percentage of holders control the majority of voting power. This is not decentralization but more of a whale playground.

$FORTH holders have been able to vote on a few proposals, but none have been transformative. Instead, governance feels more like a marketing tool than a meaningful way to steer the protocol. $SPOT now adds another dimension, but the same whales that dominate $FORTH governance are likely to control $SPOT’s future as well.

What's the Investment Case? Spoiler: There Isn't One.

Let's be honest: generally, the value of governance tokens is shaky at best. Here’s why:

• No Value Accrual: $FORTH does not generate cash flows, offer staking rewards, or improve $AMPL’s core utility. $SPOT does not change this dynamic but just creates another speculative asset.
• Tokenomics Confusion: Every new token dilutes the ecosystem. $FORTH and $SPOT spread out liquidity and focus, making it harder for investors to see the big picture.
• Speculation Over Utility: $FORTH and $SPOT exist largely as speculative instruments. They do not directly solve problems for $AMPL’s ecosystem. They are just layers of complexity for traders to play with.

If you are holding governance tokens, ask yourself: where is the value? Without a clear path to utility or revenue, governance tokens are just fancy voting rights with no payoff.

Lessons from Other Projects

Ampleforth is not alone in this over-tokenization trend. Look at Compound’s $COMP token: its governance model has not driven massive innovation, and most users are simply farming it for yield. Then there is also MakerDAO’s $MKR, which offers governance with real value accrual through fees but even that system struggles with whale control. $FORTH and $SPOT, by comparison, offer even less to their holders.

My Final Conclusion: Do not Get Rugged by Governance Theater

The Ampleforth ecosystem shows how easily governance tokens can derail a project’s focus. $AMPL was a solid innovation on its own, but the addition of $FORTH and $SPOT complicates what should be a straightforward value proposition. $FORTH governance has not driven meaningful decentralization, and $SPOT does not solve any new problems. These additional tokens just add noise.

Here is the bottom line: governance tokens are a hard pass for me. They dilute value, distract from core innovations, and often exist solely to drive hype. If you are looking for a real investment case, focus on projects with clear utility, revenue generation, and sustainable tokenomics.

Stay skeptical, stay liquid, and don't get rugged by decentralization hype.

Thank You for Reading! If you enjoyed this article and found it helpful, consider following me on Publish0x and Medium for more crypto alpha.

If you are not yet registered on Binance, I would greatly appreciate it if you used my Binance invite link to sign up. By doing so, you will save on trading fees for every trade you make, and it supports my work: Referral Code: E3PGAJCE

Happy HODLing, and see you on the moon!

You may also like: Altcoin Alphas and Bitcoin Bosses - How to Maximize Gains in the 2025 Crypto Gold Rush