Solana Glossary
What Is Tokenomics?
Tokenomics is the economic design of a token — supply, distribution, vesting, and burn mechanics. Learn how to design good tokenomics.
Tokenomics is the economic design of a cryptocurrency token — encompassing total supply, distribution allocations, vesting schedules, burn mechanics, utility, and incentive structures.
Key Tokenomics Decisions
- How many tokens exist (1B for meme coins, 10-100M for utility)
- How tokens are allocated (team, community, liquidity, treasury)
- Lock schedules for team and insider tokens
- Whether supply grows, shrinks, or stays fixed
- What the token is used for beyond trading
Good vs Bad Tokenomics
Good tokenomics align incentives between creators and holders. Bad tokenomics concentrate value with insiders at the expense of the community. Key red flags: no vesting, excessive team allocation (over 30%), active mint authority, and no liquidity locking.