6 lines
635 B
Markdown
6 lines
635 B
Markdown
# Pre-mine
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Is the process of bootstrapping a [cryptoasset](cryptoasset.md), a pre-mine is an allocation of the total supply of the asset to a set of early insider who fund the initial development of the token. This creates [asymmetric-information](asymmetric-information.md) in which early shareholders have a share of all future tokens and undue influence over [price-formation](price-formation.md) of the asset once it goes live on a [crypto-exchange](crypto-exchange.md).
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Pre-mines are most often distributed to venture capital firms.
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Pre-mines have been criticised as an obscured form of [pump-and-dump](pump-and-dump.md) scheme. |