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Mirror tokens always trade at a discount to the spot price of the unlocked token. A mirror token represents a claim on tokens that unlock over time. Because buyers are taking on vesting and time risk, they require a lower price than the fully unlocked token. Paying more for a locked version than for the unlocked token would not make economic sense. Mirror token prices are not enforced or controlled by 1st. Prices are determined continuously by supply and demand on each trading pair.

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How pricing forms

Sellers decide how much of a discount they are willing to accept in exchange for early liquidity. Buyers decide how much discount they require to take on vesting risk. The resulting price emerges through the order book and updates with every trade. When a new trading pair is listed, the market opens using the price at which the underlying allocation used by the market maker to provide initial liquidity was acquired in the private market. This price reflects the prevailing OTC value of a locked allocation with the same vesting terms and serves only as an initial reference point. Once trading begins, prices are free to move immediately based on supply and demand.

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How prices change over time

As vesting progresses, prices tend to converge toward spot. The closer a mirror token is to its final unlock, the less vesting time and risk remains. As a result, sellers are generally less willing to accept large discounts, and buyers require less compensation for waiting. In practice, mirror token prices converge toward the spot price as remaining vesting time approaches zero. There are no enforced pricing curves or target discounts. The relationship between time and price is discovered continuously by the market.