Terms You Need to Know Before Entering a Presale

Joining a presale is one of the first steps toward becoming a savvy crypto user. Presales are where many hidden gems can be found. They represent Web3 projects in their early stages, projects that require funding to grow.

But when you first step into the world of crypto investing, the amount of new information and unfamiliar terminology can feel overwhelming. To help you, we’ve prepared the essential terms you need to know before joining your first presale.

Understanding Crypto Presales

The word presale literally means “before the sale.” In Web3, a “sale” begins when a token is listed on a centralized or decentralized exchange, ready to be traded, staked, bought, or sold.

A presale happens before that stage, when the crypto startup still needs funding to develop its project.

How Does Presale Work in Crypto?

To raise funds, project founders mint tokens, digital assets that represent the value of their project. These tokens can be divided into thousands or millions of units and sold to investors.

There are three main ways to do this:

• ICO (Initial Coin Offering): The project sells tokens directly on its own website.
• IEO (Initial Exchange Offering): Tokens are offered through a centralized exchange.
• IDO (Initial DEX Offering): Tokens are sold on a decentralized platform through smart contracts.

Some platforms, called launchpads, are built specifically to incubate and launch new projects in Web3. CoinTerminal is one such IDO launchpad.

How to Get in on Presale Crypto?

It’s easier than you think:

If you want to explore projects directly, sites like ICOdrops list active ICOs.

For IEOs, IDOs, or launchpads, platforms like CryptoRank let you compare categories and performance.

Each option has its own benefits and risks. At CoinTerminal, we operate as the first and only open-access launchpad, a decentralized platform designed to make presales simple, transparent, and rewarding.

Common Terms to Know in Presales

When you join a presale, you’ll see information displayed under the project’s tokenomics. These terms explain how tokens are distributed and sustained over time.

Soft Cap

The minimum amount a project must raise during a presale to mint tokens and proceed. Example: If a project sets a soft cap of $100k, it must raise at least that amount for the sale to count.

Hard Cap

The maximum amount a project will raise in that round. It sets a ceiling on how much can be collected through that channel at that price, protecting token value.

Whitelist

A marketing tool where users perform tasks (joining Telegram, retweeting, etc.) to gain early access to a presale. Think of it as entry into an exclusive club.

Allocation

The portion of tokens reserved for a specific purpose or sale. Example: $200k allocated for an IDO on a launchpad using a first-come-first-served model.

Vesting Period

A schedule controlling when tokens are gradually released. For example, 10% at the token generation event (TGE), then 30% after two months, with the rest over six months. Vesting protects token price stability and signals how circulating supply will evolve.

Lockup

Tokens that are reserved and cannot yet circulate. Lockups help maintain scarcity and price stability.

KYC (Know Your Customer)

A compliance process requiring identity documents (passport, driver’s license, or ID). KYC helps prevent money laundering and ensures legal participation.

Liquidity Pool

A pool on a decentralized exchange (DEX) where tokens and stablecoins are locked to enable trading. Liquidity pools ensure that after listing, you can freely buy and sell tokens.

What Are the Risks of Presale Crypto?

Presales carry inherent risks:

• Security risks: scams, phishing, or fake projects.
• Market risks: volatility, thin liquidity, or hype cycles.
• Platform risks: whether ICO, IEO, or IDO, each channel has its own vulnerabilities.

Still, the rewards can be significant. In crypto, double-digit returns are common, far beyond the ~4% yield of U.S. treasury bonds.

7 Things to Know Before Entering a Presale

Before entering a presale, it’s important to look beyond the excitement of early access. Taking time to review a few key factors will help you make informed decisions and approach the opportunity with confidence.

1. Project Fundamentals (Whitepaper and Roadmap): Check whether the project has a clear vision, structure, and long-term goals.

2. Tokenomics: Study how tokens are allocated and how the project balances sustainability.

3. Regulatory Risks: Review your local laws. Some jurisdictions restrict presales or how you must declare income.

4. Wallet Setup: Start with a multi-chain wallet like Trust Wallet or MetaMask to interact with different networks.

5. Allocation Rules: Know whether the presale follows first-come-first-served, lottery, or staking-based allocation.

6. Liquidity and Listing: Confirm where and when tokens will be listed, and how liquidity will be provided.

7. Risk Management: Educate yourself constantly and never invest more than you can afford to lose. Diversify your exposure.

Final Thoughts

Joining a presale can be one of the most rewarding experiences in crypto. It not only gives you early access to promising projects but also teaches you about tokenomics, economics, and risk management.

At CoinTerminal, we select projects that fit strong narratives and long-term potential. Every month, we also run a crypto lottery, so even if you request a refund, you still keep your chance to win.

Check out our active sales today and take your first confident step into the world of presales.