Vesting Creation

Vesting schedules are a common practice in the cryptocurrency space, used by projects to align the motivations of founders, staff, and other stakeholders. LitBit Finance offers a Vesting Creation utility that allows project owners to easily implement a vesting schedule for their tokens or assets, providing an added layer of confidence for investors.

What is a Vesting Schedule?

A vesting schedule is a mechanism that requires token holders to hold their tokens or assets for a specific length of time before they can be sold. This is done to ensure that the project's main actors are motivated to work toward the long-term success of the project, rather than merely aiming to cash out as soon as possible.

Vesting schedules can also be used to maintain the market's supply of tokens or coins. They can prevent a sudden influx of tokens or coins into the market, which could cause price volatility, by releasing them periodically rather than all at once. Additionally, a vesting schedule may be used to help build confidence in a cryptocurrency project. By demonstrating that the project's key players are committed to the long-term success of the project, a vesting schedule may help to build trust and credibility with potential investors and users.

How LitBit's Vesting Creation Utility Works

Project owners can use LitBit's Vesting Creation utility to easily implement a vesting schedule for their tokens or assets. The utility handles the distribution of tokens or assets based on the schedule set by the project owner.

For example, a cryptocurrency project may offer tokens with a vesting schedule to its founders, advisers, or early investors. This means that the tokens will not be available for trade or transfer right away, but rather be distributed in a number of increments over time.

Here is an example of a vesting schedule for a core team using LitBit's Vesting Creation:

  • Locked for 1 year and 3 months

  • Released at 2.08% per month until the end of Year 3, Q4

This vesting schedule is designed to distribute tokens on a monthly basis over the course of three years, ensuring that token holders are motivated to contribute to the project's long-term success.

To use LitBit's Vesting Creation utility, project owners will need to create an account on the platform and follow the instructions provided to set up the vesting schedule. Once the schedule is set, the utility will handle the distribution of tokens or assets according to the schedule.

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