Cliff Vesting
delayed unlock model
Cliff Vesting is a token distribution model where no rewards or tokens are released until a specific period—known as the “cliff”—has passed. Once this initial delay expires, tokens begin to unlock either all at once or on a rolling schedule. This model is commonly used to secure long-term alignment from team members, advisors, or early investors by discouraging early exits or speculative flipping.
Use Case: A project allocates tokens to founders with a 12-month cliff, meaning they receive nothing for the first year. After that, tokens unlock monthly over the next three years, rewarding long-term commitment and performance.
Key Concepts:
- Initial Lock Period — No tokens released until the cliff ends.
- Vesting Start Trigger — Unlock begins only after the cliff duration is reached.
- Retention Incentive — Deters premature exits by stakeholders.
- Governance Control — Delays influence of early token recipients in DAOs or votes.
Summary: Cliff Vesting serves as a protective delay mechanism in token distribution, ensuring that early contributors or investors stay committed through critical growth phases. It’s a foundational tool for sustainable tokenomics and fair protocol development.