Moratorium
A moratorium is a period of time in which certain activities are suspended or temporarily restricted. In the cryptocurrency context, it refers to a period when an initial coin offering (ICO) has been “frozen” by its issuer and no new coins can be created or traded until further notice. This can happen due to various reasons such as regulatory issues, technical problems, economic downturns etc.
The purpose of having a moratorium is to give the ICO issuer some breathing room while they work on resolving whatever issue led them to suspend trading or issuing new tokens. The benefit of this kind of arrangement is that investors have access to their funds during this freeze period rather than risk losing them altogether if the project fails completely prior to resolution being reached. Moratoria can also provide stability in the market by preventing sudden price fluctuations caused by potential buyers and sellers entering/exiting positions without any clear direction for future prospects.
In most cases, after the moratorium period comes to an end, all existing token holders will receive additional coins from their original investment in order to make up for lost value due to not being able to trade during the freeze period. This helps protect investors who were unable to sell or purchase additional tokens before trading was paused and keeps faith with those early adopters who chose not abandon their investments despite uncertain times ahead.
