Allocation

An allocation refers to an allotment of tokens or equity that is purchased, earned, or reserved for a specific investor, team, organization, or corresponding entity. Blockchain startups must determine their initial token allocation to facilitate the long-term viability of their business model, with various allocations for marketing, software development, and operational costs.

Many blockchain projects have their own treasuries and foundations which typically possess a specific token allocation as well. It is also common for blockchain startups to give early team members a specific token allocation, with the stipulation that they cannot sell their tokens for several years.

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