📌 Token Distribution Models Summary
Token distribution models are methods used to decide how digital tokens are given out to participants in a blockchain or cryptocurrency project. These models outline who gets tokens, how many they receive, and when they are distributed. Common approaches include airdrops, sales, mining rewards, or allocations for team members and investors. The chosen model can affect the fairness, security, and long-term success of a project.
🙋🏻♂️ Explain Token Distribution Models Simply
Imagine a group of friends baking a cake together and deciding how to share it. Token distribution models are like the different ways they could slice and hand out the cake, such as giving everyone an equal piece or rewarding those who helped the most. The way the cake is divided can influence how happy everyone is and whether they want to bake together again.
📅 How Can it be used?
A project could use a token distribution model to reward early adopters and contributors while ensuring fair access for new users.
🗺️ Real World Examples
The Ethereum network used an initial coin offering (ICO) to distribute its Ether tokens. Early supporters could buy tokens before the network launched, helping raise funds for development while distributing tokens widely among users and investors.
Uniswap, a decentralised exchange, distributed its UNI governance tokens through an airdrop to anyone who had used the platform before a certain date, rewarding early users and encouraging ongoing community participation.
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