Incentivizing Employees With Tokens vs. Equity

Tokens that are readily available to trade on an exchange are more liquid than equity.  Hence, tokens provided to early employees as an incentive for early support in a new company’s evolution are more beneficial to the employees, since they can convert them to cash right away.

Of course equity requires that employees devote themselves to the long-term success of the company to benefit from a liquidity event some day in the future.  This would seem to better support the future of the business and hence the employees.

We’ll see how the new blockchain economy plays out with blockchain startups as time progresses.