What is Token Vesting?

Token vesting is a mechanism that gradually releases tokens to holders over a set period, rather than all at once. It helps ensure long-term commitment from team members, advisors, and investors by preventing immediate token dumping, which can harm a project’s token economy.

Vesting schedules are a key part of token launches and fundraising events, providing transparency and building trust in the community.

Types of Token Vesting

In CryptoHub and across Web3 projects, vesting is typically structured in one of three main ways:

Time-Lock Vesting

All allocated tokens are locked for a fixed period, with no releases until the lock ends. This is the simplest form of vesting and is often used for early-stage team or advisor allocations.

Example: Tokens are fully locked for 12 months and released in full at the end of the period.

Cycle (Milestone) Vesting

Tokens are released in batches based on fixed intervals or upon reaching specific milestones. This could be monthly, quarterly, or tied to project achievements.

Example: 20% of tokens released every 3 months, or a portion released when a product beta goes live.

Linear Vesting

Tokens are released gradually and continuously over a set period. This creates a predictable and smooth release schedule.

Example: After launch, tokens vest evenly every day over 18 months.

Additional Vesting Features — Cliffs

A cliff is an initial lock-up phase applied before any vesting begins. Cliffs can be added to cycle or linear vesting to ensure recipients remain committed for a minimum period.

Example: A 6-month cliff on a 12-month linear vesting schedule means no tokens are released in the first 6 months, then tokens vest gradually over the remaining 6 months.

Why is Token Vesting Important?

• Builds Trust: Investors and the community can see tokens unlocking over time, reducing fears of sudden sell-offs.

• Encourages Commitment: Teams and advisors stay motivated to contribute to the project’s success long-term.

• Supports Tokenomics: Controlled release helps stabilize token price and market supply.

How to Claim Vested Tokens

When tokens vest, holders need to actively claim them via the project’s smart contracts or platform interface. Claiming is often done through:

• Launchpad Claim Pages: Many platforms, including CryptoHub, provide user-friendly dashboards for token claims.

• Wallet Interaction: Users approve transactions via wallets like MetaMask or Trust Wallet to transfer vested tokens.

• Claim Fees: Some platforms may charge small fees to process claims, usually payable in native tokens or gas fees.

Token vesting is a crucial part of a successful token launch and fundraising process. Understanding vesting types and how to claim your tokens helps you stay informed and protects your interests as an investor or team member. Explore CryptoHub’s tools for managing token vesting and claims seamlessly on multi-chain launchpads.