Tokenomics dilution calculator

A token at $1 today with 20% annual emissions is a token at $0.69 in 2 years even if market cap stays flat. Emissions and unlocks dilute every holder who isn't also an emission recipient. This calculator shows your share of network over time given a token's emission schedule.

Enter current supply, your holdings, annual emission rate, and horizon. Output: your share of total supply at year 1, 2, 3, 5, 10, and the implied price-to-break-even if market cap stays constant.

The worst dilution scenarios are not random — they follow a pattern. A token launches with 30% of supply in circulation. Team and VC vesting unlocks 40% over 3 years. Protocol emissions add another 15% annually. By year 3, circulating supply has tripled and the price must 3x just for early retail buyers to break even. This cliff pattern destroyed hundreds of 2021-era DeFi tokens: LOOKS (LooksRare), ILV (Illuvium), and STEPN (GMT) all followed it.

Token unlocks are public information. Sites like TokenUnlocks.app and Vesting.app display every scheduled unlock event with amounts and dates. Before buying any token above $5M market cap, check the unlock calendar. A token trading at $2.00 with 50 million tokens unlocking next month at a $0.50 average VC cost is a token with $75 million in motivated sellers entering the market shortly. This is not obscure information — institutional desks price it in before retail does.

Real emission rates on popular tokens

BTC: ~0.8% annualized post-April 2024 halving (will halve again to ~0.4% in 2028). ETH: net deflationary during high-use periods (burns > issuance); ~0-1% net supply change. SOL: ~5% annualized, targeting 1.5% terminal. ATOM: ~10%. Most Cosmos chains: 10-20%. Many 2021-2023 'Layer 1' launches: 5-25% with large VC unlock cliffs.

How to read a token vesting schedule

A proper vesting schedule shows three things: who holds each allocation (team, investors, foundation, ecosystem), how long until each tranche unlocks, and whether there is a cliff (a period of no unlocking followed by a sudden release). A 12-month cliff with 36-month linear vesting means nothing unlocks for a year, then 25% drops in one transaction, and the remaining 75% releases monthly over 3 years. That 25% cliff event is a predictable sell-pressure date.

The float ratio — circulating supply divided by total supply — tells you how much of the supply has already been absorbed by the market. A token with 15% float and 85% still locked has taken in buyer demand against a tiny fraction of eventual supply. When that remaining 85% enters circulation, it needs buyers to absorb it at current prices or higher. Most tokens with float ratios under 20% at launch underperform their early price over 18 months.

VC cost basis matters for predicting unlock sell pressure. If an early investor bought 10M tokens at $0.05 each and those tokens are now worth $1.00, they are sitting on a 20x gain. When their lock expires, they have every incentive to sell regardless of the project's long-term fundamentals. Calculate the implied VC profit at current price and their unlock date. If the profit is 10x+ and the unlock is within 6 months, that is structural headwind.

Tokens that got dilution right

Bitcoin's inflation schedule is the gold standard: pre-programmed halvings with a hard cap of 21 million, transparent since 2009. No foundation wallet, no VC allocation, no team allocation. Every mined BTC goes to whoever provides proof-of-work. This is why BTC holders do not need to track a vesting schedule — there is none.

Ethereum post-Merge issues roughly 0.27% of supply annually to validators. The EIP-1559 burn destroys a base fee from every transaction. During periods of moderate network activity, the burn rate exceeds issuance, making ETH net deflationary. In May 2023, ETH supply was shrinking by ~1,000 ETH/day. This was not guaranteed — it depends on network usage — but it aligned miner incentives with supply sustainability.

Uniswap (UNI) is a cautionary tale done better than most. 40% went to team and investors with 4-year vesting. The community treasury holds 43%. Four years in, most team and investor tokens have unlocked without catastrophic price pressure because the project has real revenue ($1B+ in annual protocol fees). When protocol fundamentals are strong enough, even large unlocks get absorbed. The rule: emissions kill tokens with no revenue; tokens with real demand survive them.

Dilution math for staking participants

If you stake and receive emissions proportional to your share, you are not being diluted relative to other stakers — but you are being diluted relative to non-stakers and against any real-world cost metric (USD). If a token emits 20% annually and you stake for 18% APY, your share of staked supply stays roughly flat while non-stakers lose 20% of their share. Your USD value stays flat only if market cap grows enough to absorb the new supply.

Staking reward math is more complex than it appears. If total staked supply is 60% of circulating, and emissions are 15% of total supply, the effective APY for stakers is 15% / 0.60 = 25% gross. This sounds attractive. But 15% new supply still exists — it just concentrates among stakers. The 40% of holders who do not stake get fully diluted. Over 3 years at this rate, non-stakers hold 65% less of the network.