What Is a Crypto Launchpad & How It Works?

1. What is a launchpad?

A Launchpad is a platform that helps Web3/blockchain startups conduct their first token or NFT sale (e.g., IEO, IDO, ICO). Its purpose is to link new projects with early investors, enabling community-based fundraising and offering participants early access to token purchases.

2. Common launchpad models

2.1 Stake-to-access

Users stake platform tokens to receive purchase allocation. The more you stake, the higher your allocation. This enhances token stability, but has risks of pyramid‑style effects if unchecked.

2.2 First-Come First-Served (FCFS)

Allocation is granted on a first‑come, first‑served basis, ensuring fairness without staking requirements. However, fixed per‑user limits can lead to under‑subscription if demand is low.

2.3 NFT-based model

Users need a special platform NFT to get allocation. Each NFT grants equal rights to buy tokens, promoting fairness and transparency.

3. Benefits of launchpads

For investors:

Access to early‑stage tokens at low prices with potential high returns (sometimes hundreds or thousands of times).

Opportunity to join new projects at the start.

For projects:

Easier access to community funding.

Credibility through platform vetting.

Greater visibility and community engagement.

4. Potential risks

Token prices may drop post-launch despite initial success.

Stake‑based models can strain users if token value falls.

FCFS may result in incomplete token sales.

NFT‑based models may suffer low liquidity if the project underperforms.

5. Best practices

Understand requirements: KYC, stake, NFT, whitelist conditions.

Research thoroughly: team, tokenomics, tech viability.

Use reputable platforms: such as Binance Launchpad, CoinList, Polkastarter.

Manage risk—only invest what you can afford to lose.