What is Soft Cap?

Soft cap refers to the minimum amount of funds that an upcoming blockchain enterprise wishes to raise via its initial funding round. A soft cap is usually speculative and arbitrarily defined, and contrasts with a hard cap which is the maximum designated amount available to earn through a funding round. Sometimes if a team is unable to reach the soft cap, or minimum required fundraising amount, funds will be returned to investors and the project may cease development. In other cases when the soft cap is not met, projects may continue development despite not reaching their stated goal.