⚠️ What Is Foundation Allocation Risk?
Foundation allocation risk refers to the risk created when a large portion of a token’s supply is controlled by the project’s foundation, treasury, or core team.
Even if the chart looks bullish, this hidden supply can cap upside or pressure price.
📊 How Foundation Allocation Risk Appears
A significant % of tokens held by the foundation
Tokens unlocked through vesting schedules
Treasury sales to fund operations, marketing, or development
Limited transparency on how and when tokens are used
This creates potential sell pressure that most traders don’t price in.
🚨 Why It Matters for Traders
✔ Large holders can sell into rallies
✔ Price may stall despite strong demand
✔ Breakouts fail more often
✔ Volatility increases around unlock dates
The market may look strong — but supply is waiting above price.
🔍 How to Spot Foundation Allocation Risk
Check tokenomics and vesting schedules
Track unlock calendars
Watch for repeated selling after pumps
Notice strong volume with weak price follow-through
🎯 Final Thought
Foundation allocation risk doesn’t mean a project is bad —
it means price may need time to absorb supply.
Smart traders respect tokenomics as much as charts.
Price moves when supply is exhausted — not before.
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