Equity Compensation: How Companies Reward Employees with Shares and Tokens
When talking about Equity Compensation, a system where employees receive ownership interest in the firm, often through shares or share‑like assets. Also known as employee equity, it bridges the gap between salary and long‑term wealth creation. This model helps align employee interests with company performance, encourages retention, and can turn a small startup into a lucrative venture for early hires. At its core, equity compensation includes traditional instruments like stock options and RSUs, but it’s rapidly expanding to include blockchain‑based forms such as tokenized stock.
Key Types and Trends in Equity Compensation
One of the most common forms is Stock Options, the right to purchase company shares at a preset price after a vesting period. Often paired with a strike price, they give employees the chance to profit when the market price exceeds that level. Another staple is Restricted Stock Units (RSUs), granted shares that vest over time or upon hitting performance milestones. Unlike options, RSUs have intrinsic value as soon as they vest, making them attractive for risk‑averse workers. The newest player is Tokenized Stock, digital tokens that represent ownership in real‑world equities on a blockchain. Projects like Ondo’s NVOon let employees hold a crypto‑based version of Novo Nordisk shares, blending liquidity, fractional ownership, and global accessibility.
These instruments are linked by several semantic relationships: equity compensation includes stock options and RSUs; equity compensation requires legal and tax compliance; tokenized stock influences traditional equity models by adding programmable features and instant settlement. Understanding each piece helps you pick the right tool for your career stage. Below you’ll find deep‑dive articles that break down how to trade on Uniswap V3, the mechanics behind tokenized securities, and the broader impact of crypto on employee ownership. Dive in to see how these concepts play out in real‑world examples and what they could mean for your next compensation package.
