Initial Utility Token Launch: Everything You Need to Know About TGE

TGE Is How Projects Launch Ecosystem Tokens

When a crypto project wants to grow its community and expand its scale, issuing tokens becomes a crucial step. The token generation event (TGE) marks the moment when a project officially creates and distributes digital assets to eligible users. Unlike coins considered as stores of value, tokens issued through TGE are often highly utility-driven — they can be programmed for governance, payments within the ecosystem, staking, or many other purposes.

A common confusion is that TGE is often mentioned alongside the term initial coin offering (ICO). Although these two concepts share similarities, they are truly different in important ways — and understanding this will help you evaluate token opportunities more accurately.

Why TGE Is Different from ICO

To understand this clearly, look at the core purpose of each event. ICO is a way for projects raise funds from the community by selling tokens that resemble securities. Regulators often scrutinize ICOs carefully due to strict compliance requirements.

In contrast, TGE focuses on distributing access rights to a project via utility tokens. The main goal is not monetary value but usability — tokens enable users to participate, vote, or earn rewards within the ecosystem. For this reason, many projects prefer to call their issuance event TGE instead of ICO, to avoid any suggestion that their assets might be securities.

Four Main Reasons Why Projects Organize TGE

1. Opening Doors for New Users

A strong project may have already attracted early users, but the token creation event is an opportunity to expand. Token distribution provides new users with the foundational assets they need to participate — that is, the tokens themselves. Through TGE, the project can lead a wave of new participants, each capable of contributing to the ecosystem’s growth.

2. Empowering Community Governance

Most tokens issued via TGE are governance tokens. Holders can vote on project decisions — from protocol updates to fund allocation. This model creates a community with aligned interests, as token owners are rewarded for their active participation.

3. Increasing Token Liquidity

When a token is widely distributed through TGE and listed on crypto exchanges, liquidity significantly increases. Higher liquidity means more stable prices, easier trading, and the community’s easier access to buy, sell, or hold tokens.

4. Facilitating Fundraising

Although TGE is primarily not a fundraising mechanism, some projects use it to raise additional capital. By issuing tokens with market value, the project can create economic value to fund further development.

How to Evaluate a Potential TGE

If you are aware of an upcoming TGE, it’s important to conduct thorough research before committing. Here are essential evaluation steps:

Start with the Whitepaper

The project’s whitepaper is the most official source of information. It should clearly state the purpose, core technology, development roadmap, team composition, and — most importantly — tokenomics (how tokens are created, distributed, and managed). A well-written whitepaper will provide useful hints for deeper research.

Check the Founders’ Background

The leadership of the project is a decisive factor. Learn about their history, previous projects they’ve been involved in, and the skills they bring. Experienced founders with a solid track record are more likely to lead the project to success than newcomers.

Follow Community Discussions

Platforms like X (Twitter) or curated Telegram groups reflect the genuine opinions of the crypto community. Here, users and developers share candid insights, criticisms, and unresolved concerns. Participating in these discussions gives you a more comprehensive view of the project.

Understand the Risk Landscape

Risks from TGE are diverse. A major danger is rug pull — when project owners issue tokens, create fake hype through marketing campaigns, then disappear with the funds, leaving tokens nearly worthless. To avoid this, verify the project’s legitimacy, the team’s experience, and the security of smart contracts. Also consider the competitive landscape — is this field saturated or still with growth opportunities?

Notable TGEs in Crypto History

Uniswap: Governance Token for a Decentralized Exchange

Uniswap, a decentralized exchange launched in 2018, issued the governance token UNI in September 2020. An initial supply of one billion UNI tokens was minted, with a four-year distribution plan until September 2024. This event empowered the community by giving UNI holders voting rights on protocol changes. At the same time, Uniswap launched a liquidity mining program, rewarding UNI tokens to liquidity providers. Currently, UNI is traded at $5.41, reflecting strong community demand.

Blast: Ethereum Layer-2 with Breakthrough Airdrop

Blast, a Layer-2 solution for Ethereum, held its TGE on June 26, 2024. The project issued BLAST tokens via airdrop to users who linked Ether or USDB with the Blast network, as well as those interacting with dApps on the platform. Seventeen percent of the total supply of BLAST was distributed through this TGE, creating broad ownership dispersion.

Ethena: Synthetic Stablecoin with ENA Token Distribution

Ethena made its mark through a TGE on April 2, 2024. The project is known for USDe — a non-traditional stablecoin not backed by centralized collateral. Ethena issued 750 million governance tokens ENA to “shard” holders, a reward mechanism for users completing activities within the ecosystem. Currently, ENA is traded at $0.23, indicating ongoing market valuation.

Important Things to Remember About TGE

TGE is not a golden ticket — there are no guarantees of refunds if the project fails. Crypto assets carry high risks and can be highly volatile. Before participating in any TGE, carefully consider your financial situation and seek advice from legal or investment professionals if needed.

Not all projects hold TGEs — only those that require tokens to operate have such needs. However, most modern decentralized projects adopt tokenization as part of their development strategy.

TGE marks the next steps for projects, from empowering the community to increasing liquidity and raising capital for further development. If you follow crypto projects you trust, future TGEs could be opportunities to join their growth, as long as you conduct sufficient research.