What it is
A vesting schedule outlines the conditions under which cryptocurrency tokens, often allocated to founders, team members, advisors, or early investors, become unlocked and transferable over a period of time. This mechanism typically includes a "cliff" period, where no tokens are released, followed by a gradual release (e.g., monthly or quarterly) of the remaining tokens over several years.
Vesting schedules are crucial for aligning incentives and preventing large token dumps that could destabilize a project's market price shortly after launch. When tokens from a vesting schedule unlock, they add to the circulating supply, potentially increasing sell pressure if recipients decide to cash out. Investors track vesting schedules to anticipate periods of increased supply and potential price volatility.
Why it matters
Vesting schedules impact a token's circulating supply and can signal future sell pressure, influencing price stability and investor decisions.
Reviewed under editorial standardsUpdated September 26, 2026Not investment advice