Definition
A cliff is a specific time period at the beginning of a vesting arrangement during which no tokens are unlocked or distributed. Once the cliff period ends, vesting begins according to the agreed schedule, and tokens start to become available. In crypto and DeFi, cliffs are commonly applied to team allocations, investor allocations, and governance token distributions. The concept is a structural element of tokenomics, shaping how and when supply enters the market.
Within a broader emission schedule, the cliff defines the initial delay before any emissions or releases occur for a given allocation. It is typically expressed as a fixed duration, such as six or twelve months, embedded in smart contracts or legal agreements. After the cliff, tokens may vest linearly or in discrete intervals, depending on the design. This mechanism helps align incentives between contributors, investors, and the project’s treasury over time.
Context and Usage
In DeFi projects, cliffs are often attached to governance token allocations for founders, core contributors, and early backers. By postponing the initial unlock, the cliff reduces immediate circulating supply from these groups and can signal long-term commitment. The length and structure of the cliff are usually documented in the project’s tokenomics and communicated alongside the full vesting and emission schedule.
Cliffs also interact with treasury management, since large token unlocks after a cliff can affect how a project plans spending, incentives, and liquidity programs. For community members, understanding the cliff on major token allocations helps interpret upcoming changes in token supply and potential shifts in governance token distribution. Overall, the cliff is a foundational concept for analyzing the timing and impact of token releases in decentralized ecosystems.