Token Vesting and Streams

Vesting schedules are essential in start-ups and corporate HR, creating additional incentives for individuals to stay committed to the company. In digital assets, tokens have replaced stocks, and the speed at which they are made and traded has accelerated massively. Managing a Token-based vesting schedule can be a make-or-break activity for Web3 projects and companies. This blog will highlight the critical innovation in token vesting and share best practices and tools for streamlining your Web3 token management.

This Blog is part of a series of Web3 Financial Operations guides and case studies produced by FinOps3. Explore all FinOps3 tools and content on the FinOps3 Platform.

From Stock to Tokens‍

The rise of digital assets and tokens has quickly transformed the international start-up landscape. While tokens are still a new asset class, regulatory, legal, and accounting starters are emerging fast, allowing operators to benefit from the increased access and control tokens provided without increasing friction.

The programmable nature of tokens allows for enhanced functions, such as:

• Real-time data and control over the outstanding vests at any time
• Advanced options for control over these vests are available through a multi-sig wallet or Oracle.
• Simple accounting is creating and claiming to happen natively in the asset layer.

Due to these innovations and the fact that tokens can be highly liquid, digital assets are replacing traditional stocks in capital formation and contributor rewards.

How OnChain Vesting Works

Onchain vesting impacts the token supply by managing the gradual release of tokens into circulation, which can affect market dynamics, investor sentiment, and the ecosystem's supply-demand balance. As tokens are vested and enter the circulating supply, they can impact market dynamics, investor sentiment, and the overall supply-demand balance of the token ecosystem.

Getting started with onchain vesting
Hedgey and Superfluid stand out for their features in token vesting and streams. Hedgey simplifies onchain token vesting and distributions, enhancing trust in OTC deals and facilitating token swaps between DAOs. Superfluid introduces money streams, automating and scaling recurring payments without third-party intervention. These platforms offer secure, efficient solutions for managing digital assets and automated payments while powered by Safe.

You should use a Safe Wallet to access this service for your business. If you don’t have a Safe Wallet yet, follow this guide to get started and gain complete control of your digital assets in minutes.

Hedgey

Hedgey is a free onchain token vesting and investor lockup platform that helps projects distribute tokens to their team, investors, and community. Hedgey offers customizable vesting schedules that are compatible with different wallets and custodians, and it's 100% free to use.

Setting up Hedgey

• Connect Your Wallet: Visit the Hedgey App in the Safe UI.Access Vesting Plans: Click on "vesting plans" in the left column to start creating and managing your token vesting plans
• Create a Vesting Plan: Use the Hedgey’s interface to create a custom vesting plan for your team, employees, or investors.
• Share Vesting Plans: Share the vesting plans with your team by directing them to the Hedgey platform and having them connect their wallets
• Reach Out for Assistance: If you need help or have questions, please contact Hedgey's support or book a chat for further assistance.

Superfluid

Superfluid is an asset streaming protocol that offers subscriptions, salaries, vesting, and rewards to DAOs and crypto-native businesses worldwide. It also offers money streams, which allow for perpetual and automated value transfer between accounts, providing a solution for recurring payments.

To get started with Superfluid, visit their Website or access the Superfluid app through the Safe Wallet UI.

Tips to streamline your onchain vests

• Use vests to increase stakeholder alignment: Distributing tokens among team members, advisors, investors, and users is a great way to align their incentives with the project’s goals.  Consider which groups are critical for your organization, and give them skin in the game.
• Define a clear vesting plan: Ensure all elements of the vesting plan are worked out and communicated well to avoid friction later.
• Create clawback and other clauses: Ensure your vesting plans include clauses that are triggered in case the business's progress is worse (or better) than planned. Consider clawback clauses that allow the company to cancel a vest if a contributor doesn’t follow the agreement or options that allow a contributor to trigger more vests if the company outperforms.

Streaming technology is already used for many cases beyond managing vesting schedules. By utilizing Streaming technology, you can create and manage your onchain vests. If you plan to launch a token and want even more control over each process step, we recommend checking out Hedgey’s PreToken solution.

FinOps3 is a platform and knowledge hub for Safe-powered onchain finance. It aims to accelerate the adoption and retention of Treasury Managers and Financial Operators in the Safe Ecosystem by providing resources and guidance that make setting up and running a Treasury Management System powered by Safe easy and rewarding.