A hard cap is the maximum amount of funds that a project aims to raise during its token sale or initial coin offering (ICO). It represents a predetermined limit that cannot be exceeded. Once this limit is reached, no further investments will be accepted.The purpose of establishing a hard cap is to create scarcity and manage expectations. It helps to ensure that the project does not raise unnecessary funds that could lead to inefficient use of resources. Setting a hard cap can also signal to investors that the team has a clear strategy and knows what they need to accomplish their goals. Hard caps can vary widely based on the project’s requirements and market conditions. In many cases, they are designed to reflect the project’s budget, development needs, and growth plans. Investors often view hard caps favorably, as they suggest a disciplined approach to fundraising and can help gauge the project’s potential.Overall, a hard cap serves as a critical benchmark for both the project team and investors throughout the fundraising process.