The stuff that separates smart money from exit liquidity. No jargon, no fluff, just what you actually need to know before a TGE.
Six simple ideas that explain why tokenomics matter and how they affect price right from launch day.
Total supply is every token that will ever exist. Circulating supply is what's actually trading right now. Most projects launch with only a small slice circulating, sometimes 5 to 10 percent. This makes the market cap look smaller and cleaner than it really is. Always check both numbers before judging valuation.
Vesting means insiders cannot sell right away. Their tokens get released slowly over months or years. A cliff is when a big batch unlocks all at once, and that can create a sharp sell event. The longer the lockup, the more insiders are betting on the project long term. Short vesting is almost always a warning sign.
Two groups create sell pressure at TGE: the public circulating float, and early investors looking to take profit on their cheap entry. When both are high at the same time, price usually drops hard right after listing. TokenScope calls this the Sell Pressure Value and it's one of the most important signals to check.
If the team and investors together hold more than 35 percent of supply, that is a lot of tokens in very few hands. Even with vesting, cliff unlocks can hit the market hard. A lower insider share with a higher community allocation is one of the clearest signs that a project is actually trying to build something fair.
The community allocation covers public sales, ecosystem programs, airdrops, and liquidity. Projects that give 30 percent or more to the community are showing real intent to decentralize. Low community allocation means insiders will dominate the token table for a long time, and the average holder has very little power.
Every unlock event adds new supply to the market. If demand does not grow fast enough to absorb it, price falls. The bigger the gap between current circulating supply and total supply, the more dilution pressure is coming. Always think about where supply is in six to eighteen months, not just on launch day.
Every analysis is built on five dimensions. Here is what each one means and how the scoring works.
How much of the total supply is tradeable on day one. A low float means less immediate pressure but also thinner liquidity and bigger price swings. Too high floods the market from the start.
A combined score using circulating supply and investor allocation. Even a small float can have serious sell pressure if investors hold a big chunk. This measures the real risk of a day-one dump.
Looks at how much the team holds and how long it is locked up. A lean stake with a long lockup is the best case. A fat stake with a short lockup is one of the biggest warning signs in tokenomics.
How much supply will hit the market over time as insiders vest. Calculated from the total team and investor allocation. High insider totals mean heavy dilution pressure regardless of how long they are locked up.
What percentage goes to the community through public sales, grants, airdrops, liquidity programs, and ecosystem incentives. A higher number here means a fairer and more decentralized launch.
These patterns show up in launches that end badly for retail. If you spot more than two of these together, be very careful.
Investors holding 20 percent or more with under 12 months of vesting is one of the most reliable dump predictors. They got in cheap and they will sell fast. It is not a question of if, it is a question of when.
Community share under 20 percent means insiders own most of the supply. Even if the project does well, most of the upside flows to VCs and the team, not the people who bought at launch.
If a project will not show you when insiders can sell, that is already a problem. Lack of transparency about something this important usually means the team knows it looks bad and is hiding it.
Founders holding a quarter or more of the supply gives them huge control and an eventual very large selling position. Even strong vesting cannot fully offset this once the lockup period ends.
A tiny circulating supply makes the launch market cap look small. But if only 5 percent is trading, you are already pricing in a fully diluted valuation that assumes massive growth that has not happened yet.
One bad signal can be managed. But when a project has high insider allocation, short vesting, low community share, and a stretched FDV all at the same time, that is a structure designed to move money from buyers to insiders.
Not a guarantee, but these patterns tend to show up in projects that reward people who participate early and hold through the journey.
A team holding under 20 percent with a 24 month or longer lockup is a strong signal. They have less to dump and they have locked it up long enough that short-term price drops do not benefit them.
When most of the post-insider supply goes to real users through grants, airdrops, and public programs, it shows the project is being built to be used and not just to make early backers rich.
Starting with 10 to 15 percent circulating keeps early supply tight while still giving the market enough to trade on. It limits day-one selling without creating the kind of thin liquidity that gets easily manipulated.
When team and investors together hold less than 30 percent, there is far less unlock pressure building up over time. The market can actually absorb releases without constantly fighting a headwind of insider selling.
A quick reference for the terms you will see when reading a project's tokenomics page or whitepaper.
Now you know what to look for. Head to the Analyzer, paste in the numbers, and get your verdict in under a minute.
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