Launchpool

In a typical launchpool, a centralized exchange announces a new project and opens pools in which users can stake specific assets, often the exchange's own token or a stablecoin. Over a fixed farming period, the new token is distributed to participants in proportion to their share of each pool. When the period ends, users can withdraw their original assets, and the new token usually starts trading on the exchange.

The model, popularised by large exchanges, is a low-effort way to receive new tokens without buying in a sale. It also boosts demand for the exchange's own token and gives projects a wide initial distribution.

Returns depend on how many users participate and on the new token's price at listing, which often falls after the first hours as farmers sell. Staked funds are exposed to the price of the asset locked and to the risks of keeping assets on a centralized exchange. Projects that launch this way can still have weak tokenomics or large unlocks ahead.