In crypto, allocation simply refers to how a project’s tokens or coins are divided—whether among public investors, early backers, the core team, or even a community treasury. 

It’s one of the first big decisions a project makes when launching, and it can seriously impact the ecosystem’s future.

Every blockchain project starts with a fixed supply of tokens (or a plan to issue them over time), and those tokens need to go somewhere. 

Allocation determines who gets what, and more importantly, why. It’s not just about handing out tokens. It’s about funding development, rewarding early supporters, and ensuring the project stays decentralized and stable.

For example, a project might split its total token supply like this:

• 40% to a public sale (for everyday investors)
  
• 30% to the core development team (usually vested over time)
  
• 20% for ecosystem rewards (think staking, liquidity incentives, etc.)
  
• 10% to early private investors or strategic partners
  

Team allocations usually come with a vesting period—a lock-up—so founders can’t just dump their tokens and walk away. This helps build trust and keeps them committed to the project’s long-term success.

Projects also often set aside tokens for a treasury or foundation, which acts like a rainy day fund. This reserve can be tapped later for grants, community initiatives, partnerships, or anything else supporting the project’s growth.

Get the allocation right, and you have a strong foundation for sustainability and fairness. Get it wrong—say, by giving too much to insiders or dumping too many tokens on the market at once—and things can go south fast: price crashes, trust issues, even total collapse.

So yeah, allocation isn’t just a behind-the-scenes detail—it’s a core part of the project’s blueprint.