Definition ∞ A Token Allocation Mechanism defines the predefined system governing how a new cryptocurrency’s total supply is initially distributed among various stakeholders. This includes allocations for founders, team members, investors, community incentives, and ecosystem development. It is a fundamental component of a project’s tokenomics.
Context ∞ News often scrutinizes Token Allocation Mechanisms during new project launches or token generation events, as these structures significantly influence initial decentralization, market dynamics, and the long-term governance structure of a project. Debates frequently concern fairness, potential for centralization, and the alignment of incentives among different participant groups.
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