# Token Allocation Model Build a token allocation model that maps total token supply across community, team, investors, treasury, and ecosystem buckets, then shows exactly how cliffs, vesting, TGE unlocks, staking rewards, and emissions affect circulating supply over time. - Canonical: https://finamodel.com/templates/token-allocation-model - Excel download: https://finamodel.com/templates/token-allocation.xlsx - Category: Crypto & DeFi - Model type: Sector planning - Difficulty: Beginner - Audiences: Founders & operators, Investors & analysts, Crypto founders, Token investors, Protocol strategists, Tokenomics consultants - Tags: vesting, FDV, dilution, governance, supply ## Overview Model token distribution and vesting schedules for a cryptocurrency project: total token supply is allocated across founders, employees, investors, advisors, community, and treasury. Each tranche has its own vesting curve (cliff + linear vesting, typically 4 years). The model tracks locked vs. unlocked tokens month-by-month, computes fully diluted valuation (FDV) by applying a token price assumption, and measures dilution impact as tokens unlock. The workbook includes a vesting schedule sheet with monthly unlock calculations, an inflation sheet modeling token burn (if applicable), and a fully diluted economics sheet showing governance implications. Key metrics: current circulating supply, locked supply (protocol reserves), investor lock-up periods, and stake-weighted voting power distribution. Typical tokenomics allocate 20–30% to founding team (4-year vesting), 30–40% to investors/treasury (6-month to 1-year cliff), and 40–50% to community/incentives. FDV represents the market cap if all tokens were unlocked at the current price; current market cap reflects only circulating supply. The ratio (Market Cap / FDV) indicates dilution risk. Projects with aggressive unlock schedules or high lock-up concentrations face selling pressure and governance instability. This model is essential for assessing token economics and investor protection in crypto fundraising. ## What's included - Allocation split across team, investors, treasury, community, advisors, and ecosystem incentives - Cliff, vesting, and TGE unlock logic by stakeholder bucket - Monthly or quarterly unlock timeline with cumulative released supply - Circulating supply build that separates fully diluted supply from tradeable tokens - Scenario planning for emissions, rewards programmes, or tokenomics revisions - Total token supply with allocation by category (team, community, treasury, investors) - Vesting schedules by tranche with cliff and linear components - Monthly supply schedule showing locked and unlocked tokens - Fully diluted valuation (FDV) and current valuation (for price inference) - Inflation and burn mechanics with net supply impact - Stake-weighted voting power and governance implications ## Token Allocation Model: Unlock Schedules, Circulating Supply, and Risk Metrics This token allocation model template provides a structured way to project token unlocks, circulating supply, and key tokenomics risk metrics for a fixed-supply token launch. It is designed for a tokenomics lead or CFO to size unlock risk and model investor outcomes before a token generation event (TGE). The model covers a 48-month horizon and includes scenario-driven price paths, staking-adjusted float, and sell-pressure overhang. ### Operating Drivers and Scenario Setup The model's inputs are organised on an Assumptions sheet, with blue cells for direct inputs and green cells for scenario-linked or derived values. Key operating drivers include a fixed total token supply with no minting, a reference TGE price used solely for allocation valuation, and a projection period of 48 months. - A scenario selector (1, 2, or 3) activates Base, Bull, or Bear assumptions via a CHOOSE formula. The scenario matrix defines starting price, monthly price drift, and staking participation rate for each scenario. - Allocation percentages across ten categories must sum to 100%, and per-category TGE unlock percentages, cliff periods, optional cliff-unlock chunks, and vesting durations are specified. Staking participation is scenario-linked, and a monthly treasury burn rate is an input. Investor round entry prices for seed and private rounds are also provided, with raise amounts derived from tokens times price. These inputs drive the entire projection. ### Vesting and Unlock Calculation Flow For each of the ten allocation categories and each month from 1 to 48, the model calculates monthly token unlocks as the sum of an optional cliff chunk and a linear vesting portion. The cliff chunk is a single lump released the month after the cliff period ends, calculated as vesting tokens times the chunk percentage. - The linear portion accrues evenly over the vesting duration after the cliff, using vesting tokens times one minus chunk percentage, divided by vesting duration. Vesting tokens equal category tokens minus TGE-unlocked tokens. - The TGE unlock itself is not part of the monthly schedule; it is seeded into month-1 cumulative unlock. Cumulative unlock in month 1 equals TGE tokens plus month-1 unlock, and each subsequent month adds that month's unlock to the prior cumulative total. By construction, cumulative unlock at month 48 equals total supply, which is validated. ### Circulating Supply, Price Path, and Outputs Gross circulating supply equals cumulative unlocked tokens. Staked tokens are gross circulating multiplied by the scenario-linked staking participation rate. - Effective circulating supply, the float actually available to trade, is gross minus staked. A validation check ensures effective circulating never exceeds gross circulating in any month. - The token price path is a compounding monthly series: month 1 equals the scenario's starting price, and each subsequent month equals prior price times one plus the scenario's monthly price drift. This produces FDV (total supply times price) and circulating market cap (gross circulating times price). - The model also reports monthly unlock rate (new tokens divided by prior gross circulating) and annualised supply inflation as (1 + new tokens / prior circulating)^12 - 1. Treasury runway is total capital raised across all rounds divided by monthly treasury burn, expressed in months. Investor returns per round include entry price, tokens, capital in, FDV at entry, implied dilution, and ROI at the month-48 price, with a sensitivity grid at TGE price, month-48 price, 2x month-48, 5x month-48, and a bear case of 0.5x month-48. Calculation summary: ```text Gross circulating supply = cumulative unlocked tokens ``` ### Practical Use and Model Limitations This token allocation model is intended for a tokenomics lead or CFO sizing unlock risk and modelling investor outcomes before a TGE. It helps visualise how cliffs, vesting durations, TGE unlocks, and staking participation interact to shape circulating supply and sell pressure over time. - The sell-pressure sheet values each month's unlocks at the month's price and computes an overhang ratio: total monthly unlock USD divided by that month's circulating market cap. This ratio is a key tokenomics risk metric, showing how large new sell-side supply is relative to the tradeable market. - However, the model has known limitations. The price path is a deterministic drift, not stochastic or demand-driven, and does not react to sell pressure. - Staking participation is a flat rate applied to all circulating supply, ignoring lock-up periods or staking reward emission timing. Treasury runway assumes a flat monthly burn and does not model token sales from the treasury allocation. - Investor ROI ignores the investor's own vesting schedule, comparing entry price to a single exit price. The model assumes fixed supply with no minting or burning beyond scheduled emissions. Validation checks on the Summary sheet confirm allocation sums to 100%, TGE plus vesting equals total tokens, month-48 cumulative unlock equals total supply, effective circulating never exceeds gross, token price stays positive, and overhang ratio is non-negative. ## Built for real token launch design Use this structure to pressure-test whether the proposed allocation and release schedule is credible before TGE, exchange listing, governance launch, or investor diligence. ## Focused on supply overhang and incentive alignment A useful token allocation model shows more than percentages on a pie chart. It should reveal when investor unlocks hit, how team vesting ramps, how large the community pool really is, and when circulating supply may expand faster than expected. ## Better for tokenomics review and stakeholder discussions This gives you a cleaner framework for founder, investor, and community conversations because the timing of unlocks, not just the headline allocation, is what usually drives scrutiny. ## Built for real token launch design Use this structure to pressure-test whether the proposed allocation and release schedule is credible before TGE, exchange listing, governance launch, or investor diligence. ## Focused on supply overhang and incentive alignment A useful token allocation model shows more than percentages on a pie chart. It should reveal when investor unlocks hit, how team vesting ramps, how large the community pool really is, and when circulating supply may expand faster than expected. ## Better for tokenomics review and stakeholder discussions This gives you a cleaner framework for founder, investor, and community conversations because the timing of unlocks, not just the headline allocation, is what usually drives scrutiny. ## Workbook structure ### Allocation Split This sheet shows how total supply is divided across stakeholder groups before vesting mechanics are applied. - Supply by stakeholder bucket - Initial percentage ownership view - Treasury, team, investor, and community split - High-level token allocation baseline ### Vesting Rules The vesting sheet applies cliffs, release schedules, and unlock mechanics to each stakeholder group. - Cliff and vesting assumptions by bucket - TGE unlock logic - Release timing by stakeholder group - Core distribution rules across the token base ### Unlock Schedule This sheet tracks how tokens become unlocked over time and where supply pressure may appear. - Monthly or quarterly unlock view - Cumulative released tokens - Large unlock timing visibility - Potential overhang points in the schedule ### Circulating Supply The output sheet shows what supply is actually tradeable over time rather than just fully diluted on paper. - Circulating supply by period - Fully diluted versus tradeable supply - Emission and rewards impact - Clear token-supply trajectory ### Allocation Split This sheet shows how total supply is divided across stakeholder groups before vesting mechanics are applied. - Supply by stakeholder bucket - Initial percentage ownership view - Treasury, team, investor, and community split - High-level token allocation baseline ### Vesting Rules The vesting sheet applies cliffs, release schedules, and unlock mechanics to each stakeholder group. - Cliff and vesting assumptions by bucket - TGE unlock logic - Release timing by stakeholder group - Core distribution rules across the token base ### Unlock Schedule This sheet tracks how tokens become unlocked over time and where supply pressure may appear. - Monthly or quarterly unlock view - Cumulative released tokens - Large unlock timing visibility - Potential overhang points in the schedule ### Circulating Supply The output sheet shows what supply is actually tradeable over time rather than just fully diluted on paper. - Circulating supply by period - Fully diluted versus tradeable supply - Emission and rewards impact - Clear token-supply trajectory ## Features - **Multi-tranche vesting:** Model separate vesting curves for team (4-year linear), investors (months 1-3 cliff + linear), and community programs, showing the supply inflection points. - **FDV vs. current market cap:** Calculate and track the difference between FDV (all tokens unlocked) and current price, showing upside/downside from dilution over the vesting schedule. - **Governance and incentive modeling:** Model token-based incentive programs (staking, liquidity mining) and their impact on supply and distribution. ## Use cases - **Token investor due diligence:** Analyze vesting schedules and supply inflation to assess price pressure risks and founder commitment. - **Tokenomics design and optimization:** Model alternative allocation, vesting, and burn scenarios to optimize incentive alignment and long-term supply stability. - **Community and investor communications:** Present token supply roadmap, vesting schedules, and governance participation to stakeholders. ## Frequently asked questions ### What is a token allocation model? It is a model that tracks how token supply is allocated, vested, unlocked, and circulated over time. ### Who uses token allocation models? Web3 founders, token teams, advisers, and investors use them during launch planning and diligence. ### What should a token allocation model include? It should include allocation by stakeholder group, vesting schedules, unlock timing, and circulating supply over time. ### Why is circulating supply important? Because token unlocks and emissions can affect incentives, market dynamics, and investor perception. ### Can this help before launch? Yes. It is especially useful during planning before token launch or governance discussions. ## Related templates - [Stablecoin Tokenomics Model](https://finamodel.com/templates/stablecoin-model) - [DeFi Protocol Model](https://finamodel.com/templates/defi-protocol-model) - [GameFi Token Economics Model](https://finamodel.com/templates/gamefi-model)