Vesting
Schedule releasing tokens over time, preventing immediate large supply dumps.
Last Updated
2026-03-29
Related Concepts
What is Vesting?
Vesting is a schedule that gradually releases tokens to founders, investors, and team members over time instead of all at once. It prevents immediate dumps and aligns long-term incentives.
How does Vesting work?
A typical structure is a 1-year cliff followed by 3-year linear vesting no tokens for year 1, then 1/36th released monthly for 3 years. Smart contracts enforce the schedule automatically; no one can force early release.
Why does Vesting matter?
Without vesting, founders could sell their entire allocation immediately after launch, crashing the price. Vesting signals commitment and gives the community confidence that founders are incentivized for long-term success.
Key features of Vesting
- Cliff period before any tokens unlock
- Linear or stepped release after cliff
- Smart contract enforced irreversible and transparent
- Typical duration: 4 years for founders, 2 to 3 years for investors
Examples of Vesting
Uniswap's founder tokens vest over 4 years with a 1-year cliff. Most VC-backed protocols use 1-year cliff plus 2 to 4 year linear vesting for team and early investors.