What is Token Generation Event (TGE)?

Essentially, during a token generation event, or TGE, a cryptocurrency project issues its tokens and makes them publicly available. So, before you can purchase cryptocurrencies on popular exchanges like Binance or Bybit, you can first do that during a TGE.

A token is a virtual asset that is created with a utility in mind. Tokens provide a simple entry into the bigger crypto economic system. They do not have a store of value on their own but they are made in a way that software can be developed around them.

However, there's also another widely used way of issuing and selling new tokens - an Initial Coin Offering (ICO). It is a type of crowdfunding that utilizes cryptocurrencies as a way of increasing funds for startups. Project tokens are developed and distributed to the public through these offerings as well.

Though, there are companies that are eager to increase funds from tokens, but they do not choose to utilize ICOs. Instead, they choose a TGE. What's the difference, though?

Both ICOs and TGEs are focused on a similar concept. However, because of regulatory concerns, some organizations prefer to identify their fundraising campaigns as TGEs rather than ICOs.

Regulatory organizations have been under increasing demand to recognize ICOs as the main method for issuing securities, thus, raising the prospect of taxes. Token Generation Events, on the other hand, are mostly used for issuing utility tokens, therefore, they are not taxed.