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As new tokens are launched on a daily basis, you often come across the term Token Generation Event, or TGE. Many people use TGE and ICO (Initial Coin Offering) interchangeably, but is it true?
In this article, we will give you a thorough explanation of TGE and how it works in the crypto industry. If you are a blockchain-based project owner, you’ll also learn how to launch a TGE successfully.
Let’s dive right into the definition of TGEs first.
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As its name might already suggest, a Token Generation Event (TGE) is an event hosted to launch new tokens on websites and crypto exchanges.
If you are new to cryptocurrencies, some terminologies may still confuse you. What is a token? What is a crypto exchange?
Let us clarify these points so you can understand TGEs better.
Tokens are digital assets that blockchain-based projects build on top of existing blockchain networks rather than being a native asset to the blockchain itself. Native tokens are also referred to as coins.
For example, the native token, also known as the coin, of the Ethereum blockchain is ETH, while there are multiple other crypto tokens built using Ethereum such as DAI, COMP, etc.
A crypto exchange is a platform where you can buy, sell, and trade several cryptocurrencies. It serves as a middleman between buyers and sellers.
Not all cryptocurrencies can be listed on an exchange. Each platform has its own set of criteria to review new assets for listing.
So in the end, TGEs are a kind of event that blockchain-based projects host to generate a new token to the public and get it listed on popular trading platforms.
ICO stands for Initial Coin Offering. It is mainly used as a means of crowdfunding or crowdsale.
TGEs and ICOs serve the same purposes of raising capital for early-stage cryptocurrency projects.
Let’s take a look at the table below to understand the differences between TGE and ICO.
| TGE | ICO | |
| Definition | An event hosted to launch new tokens on websites and crypto exchanges. | An event hosted to sell new cryptocurrencies to investors or speculators. |
| Means of fundraising | Tokens | Coins |
| Regulations | Not subject to regulations and taxes | Subject to regulations and taxes |
Token Generation Events work in a pretty similar way to Initial Coin Offering. When the event is launched, the project owners will issue tokens on a blockchain and offer them to investors.
How the tokens are offered to investors may vary from project to project.
The TGE may start with a pre-sale or a private round, when a small portion of tokens are sold privately to raise funds for the full event and generate buzz. The accredited investors who join this round tend to benefit from special rewards such as voting rights and discounted products.
Some projects may host public TGEs, which involve listing tokens on various exchanges and anyone can participate in trading.
Generally, TGEs accept contributions in the form of cryptocurrencies instead of fiat money. The token sale will accept either ETH or BTC transferred from a no-exchange wallet.
To participate in the TGEs, an investor must transfer the funds to the TGE smart contract address. Then, they will receive the purchased tokens via the address they have contributed.
Public TGEs are likely to be the vehicle for scams and frauds due to security vulnerabilities. Therefore, investors and TGE organizers should remain cautious.
After the funds are collected, the project owners will spend it on improving the current product or marketing efforts. Meanwhile, the investors can use the amount of purchased tokens to perform activities in the product or wait for the token’s value to increase.
Like ICOs, the main goal of TGEs is to raise funds for early-stage projects. A number of tokens will be sold to the public to gain money for future activities of the project.
Community plays an integral role in the cryptoverse. A Token Generation Event allows a project to build a community and engage users in it.
The more successful TGE is, the more attention the new blockchain-based project can draw. Nowadays, there are thousands of crypto projects released in the cryptoverse. Organizing TGEs will be a wise first step to promote and get your new business stand out from the crowd.
TGEs and token sales in general have raised billions of dollars in total, which proves the exponential growth of the blockchain industry and public interest in the market.
Below are some examples of the most successful TGEs over the years. All of them run on Ethereum blockchain.
Filecoin is a decentralized network designed to store files and retrieve them safely. It is a product of Protocol Labs. The project was launched in August 2017, and its TGE has raised over $200 million USD within the first 30 minutes.
The campaign ended in September 2017, and according to the company, it has raised approximately $250 million USD. This outstanding figure makes Filecoin top the list for the largest TGEs ever organized.
The DAO was a decentralized autonomous organization (DAO) built on the Ethereum blockchain. It was launched in 2016 and was considered one of the most high-profile projects built on Ethereum at that time.
Through its Token Generation Event or token sales, the DAO has raised $150 million USD worth of ETH.
However, it was hacked just three months after the TGE. About $60 million of ETH was lost in the hack and soon after that, the DAO token was delisted from major exchanges in September 2016.
Status is a mobile app that serves as a decentralized messaging platform, a crypto wallet, and a Web3 browser. It was launched in 2017 and raised $103 million USD through its Token Generation Event.
The governance token of Status is SNT, which allows holders to vote and determine the future of the Status Network.
Kik is a messaging platform that has been in business since 2015. KIN — the cryptocurrency of Kik, was launched as an ERC-20 token in 2017.
Through the TGE, it has raised about $97.5 million USD. Investors viewed the TGE of Kik as a worthy investment opportunity to support its core messaging app business, which was on the brink of collapse at that time.
Kik was acquired by the MediaLabs holding in 2019.
TenX is a crypto wallet and payment platform that aims to facilitate digital currencies in everyday scenarios. It is based in Singapore with the native token called PAY.
It organized the TGE event in June 2017 and when the event finished, the business had raised over $80 million. However, TenX was shut down and discontinued its services in 2021.
MobileGo, also known as MGO, is a token used within its eSports platform as rewards and entrance fee for tournaments. The MGO token can also be used to buy in-game items.
MobileGo was launched in May, 2017. Its Token Generation Event helped the business raise over $53 million USD worth.
Kyber is a decentralized exchange platform that enables buyers and sellers to exchange tokens at the best rates. Kyber Network is integrated with several applications. The whole network is governed by the holders of its native KNC token.
Kyber was launched in September, 2017 with Vitalik Buterin as the advisor. It has raised over $50 million USD when selling its token to the public to raise funds.
Here’s a summary of the largest raises through TGEs:
| Project | Launch date | Amount of funds raised (approx.) |
| Filecoin | August 2017 | $250,000,000+ |
| The DAO | May 2016 | $150,000,000+ |
| Status | June 2017 | $103,000,000+ |
| Kik | September 2017 | $97,500,000+ |
| TenX | June 2017 | $80,000,000 |
| MobileGo | May 2017 | $53,000,000 |
| Kyber | September 2017 | $50,000,000+ |
There are many advantages of launching a TGE instead of an ICO.
As mentioned above, TGEs often deal with utility tokens, which aren’t considered as securities. Tokens aren’t taxable, either. Therefore, hosting a TGE will help the business avoid legal regulations and taxes.
Second, a blockchain-based business is able to attract an early community via a TGE, which will be helpful to maintain the cryptocurrency in the long term. In addition, having an engaged community allows the projects to position themselves well among a myriad of competitors.
Meanwhile, TGEs still have some drawbacks that one needs to consider before hosting one.
First, it is faced with harsh competition from other blockchain-based projects that have the same goals. Aside from that, it is totally banned in some jurisdictions, including China and South Korea. Many European countries are also working on setting specific regulations to control TGEs and ICOs in general.
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If you think that the first step is to create a token, you are wrong!
In order for your tokens work, you must have a product that uses your token. Most blockchain-based products today are applications with different concepts such as Learn-to-earn, Move-to-earn, Play-to-earn, etc.
For example, if you want to create a token for a Play-to-earn app, you need to develop a game and decide the functions that your tokens will play in the game: to level up, join a quest, buy items, etc.
You can always consult a crypto advisor in case you aren’t familiar with this step.
Once you have a well-built product, you can start generating the token on the Ethereum blockchain. Tokens can also be in the form of NFT (Non-fungible tokens).
The next step is to craft a whitepaper. A well-written whitepaper shows the potential of your project, which will help attract investors.
The whitepaper should provide details about your project. Make sure it includes key concepts such as objectives, roadmap, tokenomics, and the legal aspects of your business.
Also, you should write it in clear and simple language.
TGEs are basically events to raise funds, so you should get legal advice to avoid any problem. Make sure you comply with the law to minimize risk for the project.
It’s time to market your product to the community. Having a community will help you spread the word about your tokens when the TGE is launched. And don’t forget to keep the community engaged as the project will continue afterward.
Some popular platforms for blockchain projects include Telegram, Discord, Slack, and Twitter. It is highly recommended to hire a community manager to manage all activities in your community.
Getting your tokens listed on various exchanges will maximize the number of investors you may attract.
Finally, you can launch the TGE to the public now. At this phase, you should execute various Marketing tactics to help create a buzz around your project. Some useful channels for crypto marketing include:
Now you know the basics of the Token Generation Event (TGE). It is basically a version of ICO (Initial Coin Offering) that arose to deal with the legal aspects of ICOs.
The cryptoverse is still changing quickly. With the release of more blockchain-based projects and tokens, TGEs are expected to prevail in the future.
We’ll keep you updated with all topics about cryptocurrencies, so please stay tuned! Thanks for reading.
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