## Why Do New Cryptocurrency Projects Start with TGE? — Essential Knowledge to Understand the Crypto Market

As the blockchain industry rapidly expands, the way new projects are launched has changed significantly. At the core of this shift is the mechanism known as **Token Generation Event (TGE)**. Understanding this crucial process in the cryptocurrency world is essential for reading market movements.

### What is TGE — Grasping the Basics

TGE refers to the event where new tokens are created and distributed to investors. In simple terms, it is the moment when a new cryptocurrency project officially enters the market, serving as the gateway for initial investors to participate.

This process is not just a technical task; it is a strategic and vital step for blockchain projects to raise funds, build a community, and launch their network. As a broader concept than ICO (Initial Coin Offering), it has now become the industry standard.

### Why Investors Focus on TGE

**Efficiency in Capital Raising**

Traditional venture finance limited investor participation. However, with the advent of TGE, small-scale investors worldwide can now participate in early-stage projects. This democratizes investment opportunities.

**Growth Narrated by Market Data**

Statistics in the crypto market reveal the high popularity of this mechanism. In 2019, about 120 TGEs were conducted annually, raising approximately $300 million. In 2020, this increased to 150 events and $450 million, and in 2021, to 180 events and $600 million. This upward growth indicates that TGE has established itself as a reliable fundraising method in the market.

### From Ethereum to Today — The Evolution of TGE

The concept of token generation events gained attention during the 2013 ICO boom, but it was Ethereum in 2014 that truly changed the industry. Ethereum’s ICO at that time was essentially a pioneering example of TGE, establishing a mainstream fundraising tool in the blockchain space.

Subsequently, with the development of regulatory frameworks, TGE has evolved from a simple fundraising mechanism to a more formal and transparent process. Enhanced investor protection, stricter compliance, and technological sophistication have all advanced.

### Transparency Enabled by Smart Contracts

A major recent change in TGE is the use of smart contract technology. Many processes, from token distribution to fund management, are now automated. This results in:

- **Reduced Fraud Risk** — Automated execution makes manipulation impossible
- **Fair Distribution** — Strictly executed based on programmed rules
- **Increased Transparency** — All transactions are recorded on the blockchain

This technological innovation has significantly boosted investor trust.

### The Impact of TGE on the Crypto Market

The expansion of new token supplies does more than just increase market size. It fosters innovation by creating diverse investment opportunities. Additionally, enabling small investors to participate helps build communities and lays a foundation for project growth.

Furthermore, projects can establish a user base and promote governance decentralization through TGE. This approach moves away from centralized corporate management toward a community-driven development model.

### Strengthening Regulations Brings Stability

As global financial regulations tighten, the TGE process is also evolving. The adoption of compliance technologies has standardized the conduct of token generation events in accordance with international standards. While this may make procedures more complex in the short term, it ultimately enhances market trust and reduces fraudulent cases.

### Points Cryptocurrency Investors Should Know

While TGE offers attractive opportunities, not all projects succeed. It is crucial to thoroughly evaluate project feasibility, the credibility of the team, tokenomics, and other factors before participating. Keeping an eye on regulatory changes is also important.

As the cryptocurrency market matures, TGE is shifting from merely a fundraising tool to a signal of project credibility. For market participants, understanding TGE is an indispensable part of making informed investment decisions.