This causes a massive--and very unsustainable--"pump" in the value of the token, as more people rush to invest in the token so they can get paid rewards by staking it (to set up more nodes and earn more rewards), which is then used to market the product saying "look how many more nodes we have! we keep getting more and more nodes!" causing others to rush to invest in the token to speculate on the value increase, which adds up to the value of the token going up and thereby either the value of the treasury held by the company going up or the value that can be extracted via inflation going up, which can then be used to pay for more rewards.
The ONLY correct metric by which to judge a cryptocurrency project is by the amount of legitimate--not "I am going to subsidize our nodes by acting as a client and using the network a ton randomly to make it look like there is a lot of usage"... which, yes, means this is a difficult metric to correctly measure--traffic, as probably measured by revenue (but maybe "untainted income" or something would work? I have stared at the question some but never managed to figure out what the best exact figure is... which is of course even harder of a problem than valuing a normal stock/company).
To draw an analogy: would you want to decide the value of a restaurant chain by the number of locations they have around the world--or a gig economy company by the number of people providing service--if you knew the company took a billion dollars in VC money and could quite literally just be paying people to set up locations or drive in circles without a single user in sight? You'd want to know how much people were actually willing to pay for the food people are buying or how much they are willing to pay for the rides they are getting, and if that answer were somehow not only $0 but NEGATIVE--as cryptocurrencies often set up unsustainable VC/pump-funded incentives focused on the USER as well!!--you'd hopefully be skeptical of the company.
(But, of course, I use those examples to explicitly include the ilk of Uber or DoorDash, as the question for SOME of these cryptocurrencies is "if we can get enough providers in enough places, only then can we unlock revenue and value". But that is then more of a progress check on their ability to build out their network as opposed to a real understanding of whether their product has any value or not... an ecosystem where you have a ton of supply and almost no actual demand is not an ecosystem which is functioning or one which will be sustainable.)