Token sale before public launch. Project offers tokens at a discount to raise early capital. Buyers get cheaper entry than whoever buys at listing.

Used by legitimate projects building real things and by people collecting money with no intention of launching anything. Both look identical from the outside for a while.

How the Rounds Stack Up

Most projects run multiple sale rounds before public trading begins.

Seed round first. Smallest group. Deepest discount. Venture funds and angels with direct team relationships. Tokens here might be fractions of a cent when the public listing targets $0.15 or more.

Private sale next. Slightly broader. Still meaningfully cheaper than listing price.

Then the presale. What gets marketed publicly. Still discounted but less extreme than seed pricing.

Worth remembering: by the time any presale is open to people finding it through Telegram or Twitter, multiple rounds of cheaper buyers already exist. That context matters when evaluating whatever discount is being advertised.

Vesting

Should be the first thing checked before sending money anywhere.

Without vesting every presale participant dumps at listing. Price collapses before retail buyers confirm their first transaction. Vesting protects against that.

Typical structure: small TGE unlock, cliff period, linear release over months or years. 10% at TGE, 6 month cliff, 18 months linear is common.

Short vesting or no vesting on early investor tokens is the clearest red flag in presale evaluation. People who paid fractions of the listing price exiting immediately into public demand. That's exit liquidity with the mechanism written into the structure.

The FDV Issue

Presale at $0.05. One billion max supply. FDV at presale: $50 million. Seems reasonable.

Token lists at $0.20. FDV: $200 million. Presale buyers sitting on 4x. Public buyers paying $200 million valuation for something weeks old.

Then vesting unlocks begin. Seed and presale investors receiving tokens monthly. Selling at $0.20 with $0.01 cost basis.

2024 saw this play out constantly. Low float at listing making price look healthy initially. Months of unlock events grinding it down as early investors work through their vesting schedule into retail demand. Not specific to any project. The structure produces the outcome regardless of how good the underlying project is.

What to Watch For

No vesting or minimal vesting on early tokens. Already said this. Worth repeating because it's the most common way retail gets hurt.

Pressure tactics. Countdown timers, limited spots, 48 hour windows. Genuine early stage opportunities don't evaporate overnight. Manufactured urgency is a sales tactic not a signal of quality.

Anonymous team asking for early capital. Presale stage requires maximum trust. Anonymous founders and no verifiable backgrounds is a significant ask that tends to get glossed over when the marketing looks polished.

No audit on the presale contract itself. Contract is holding real money. Unaudited is unnecessary risk at any stage.

FDV math that doesn't work. If reaching reasonable returns for presale buyers requires the project to hit valuations comparable to established protocols with years of real users, the numbers don't make sense regardless of how good the pitch sounds.

Scam Presales

Website. Whitepaper. Telegram group. Presale contract. Funds collected. Team disappears. Token never launches.

Getting more sophisticated. Fake LinkedIn profiles. Fake partnership announcements timed to build momentum before the raise closes. Audit badges from firms that issued no such report or don't exist.

Basic verification before sending anything: confirm team identity through multiple independent sources, not just the project website. Check the audit report exists at the auditor's actual website. Verify contract address matches official channels directly not through links shared in group chats.