A period when tokens are locked up from usage to protect the cryptocurrency, usually after an Initial Coin Offering (ICO).

A token lockup, also known as a vesting period, refers to a specific period where the developers of a cryptocurrency ‘lock’ tokens so that users cannot trade them. This period is usually brief but may be long. However, the objective of this lockup is to put a check on users selling off their tokens immediately after obtaining them. Such a situation would drive down the prices of the cryptocurrency and it will take extra effort to get these prices to rise.

Token lockups are a reliable safeguard against the possibility of a tanking cryptocurrency. Thus, due to the imposed period of waiting, the crypto asset is able to gather momentum and grow.

The allocation of cryptos in exchange for investment funds or shares in the development company.

A token sale is the allocation of tokens to potential participants in a crypto project or cryptocurrency in exchange for their funds. It is very much like an Initial Coin Offering (ICO) where the development team of a crypto project offers up investment or shareholder spots in the form of obtainable cryptocurrencies. During the sale, users have the opportunity to obtain specified amounts of the token and might even gain investor statuses.

There are different types of token sales, with ICOs being the most popular. There are also private sales and auctions in which case available tokens are first sold to wealthy investors before the general public.

A majority of token sales take place on decentralized launchpads and centralized exchanges. The former has the benefit of anonymity and less competition for participating slots while the latter is more reliable and trustworthy.

A term used to describe cryptocurrencies with specific use on their native blockchain networks.

A token is a digital unit used to represent value. It is a type of cryptocurrency that is designed to have a specific value other than just trading and exchange. Nevertheless, it can be used to substitute investment rights, as a digital receptacle for value storage, or to make transactions. Essentially, every cryptocurrency (referring to crypto coins) is a crypto token, but not all tokens are coins.

There are generally only four major serious types of tokens, corresponding to purposes for tokens. These are utility, payment, security, and stablecoin. A fifth, the meme token has its greatest examples in Dogecoin and Shiba Inu. The vast majority of tokens are created merely as speculative instruments and most become obsolete in a few weeks or months.

Every token on a blockchain uses the same creation protocol to ensure compatibility. For example, tokens on the Ethereum network use the ERC-20 protocol. Tokens on one network cannot generally be exchanged for tokens on another network without a bridge or using a centralized exchange.

Token Lockup

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