# Pre-trading

## Introduction

<figure><img src="/files/3FMQEz7twmSvCJQKdlAw" alt=""><figcaption></figcaption></figure>

Pre-Trading is designed to address issues such as overvaluation of projects, unequal opportunities between retail users and institutions, and project teams being constrained by exchanges and capital.

Our pre-trading function offers an innovative approach to unlocking early liquidity. Using a Dutch auction mechanism, projects can secure liquidity upfront - such as receiving proceeds from early token sales. This approach not only acts as a market signal but also allows for tailored engagement strategies to maximize impact in collaboration with each project.

To promote healthy development within the industry ecosystem and ensure mutual benefits for users, project teams, institutions, and exchanges, LSP.Finance has built six key features centered around Pre-Trading:

#### 1. Limited Token Supply and Low Valuation:

• Ensures tokens are distributed in smaller quantities at fair valuations.

#### 2. Gradual Token Release During Development:

• Introduces LSTs that are released progressively as the project evolves.

#### 3. Outstanding Project Selection:

• Users vote for quality projects that have received funding from reputable investors.

#### 4. Token Sale Funds Unlock Based on Voting:

• Proceeds from token sales are unlocked gradually through holder voting mechanisms.

#### 5. VC Equivalent Rights:

• Retail users enjoy benefits and rights equivalent to venture capitalists, including the same lock-up periods

#### 6. Real-Time Trading:

• Enables seamless and immediate trading of tokens.

This feature suite ensures fairer participation, mitigates risks, and fosters collaboration across stakeholders in the ecosystem.


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