Hedera, Newly EVM-Compatible, Woos DeFi With $155M HBAR Fund

The latest big-budget decentralized finance (DeFi) incentive program is coming from an unusual source: Hedera Hashgraph, an enterprise-focused mainstay from 2017 known for its blockchain-like distributed ledger technology (DLT).

In a press release on Tuesday, the HBAR Foundation, the developers of Hedera, announced a $155 million “Crypto Economy Fund” with a focus on DeFi.

Hedera will be a late entrant to the DeFi race. An official website reports that the chain currently accounts for $50 million in total value locked (TVL), but popular DeFi tracking platform DefiLlama doesn’t list Hedera among 83 other chains.

With a gaudy incentive program and the recent addition of Ethereum Virtual Machine (EVM) compatibility, the HBAR Foundation is hoping to follow the same playbook used by other layer 1s such as Near and Fantom to climb the TVL rankings.

Read more: Near Protocol Offers $800M in Grants in Bid for DeFi Mindshare

In an interview with CoinDesk, HBAR Foundation Director Elaine Song said that $60 million of the fund is allocated specifically as liquidity mining rewards for decentralized exchanges, while the remaining funds will be used for infrastructure-focused grants.

In some ways, the fund signals a strategy shift for the developers of the chain.

“Hedera has always been focused on enterprise, and even within enterprise focused on a discrete use case, which is efficient distributed ledgers and throughput,” said Song. “There is another exciting part of the industry focused on retail and adoption, however.”

Song also mentioned environmental, social and governance (ESG) efforts and a major retail-focused staking effort led by Stader Labs, the first recipient of a grant from the program.

“I would hesitate to call it a pivot, but it’s broadening our scope and taking what we’ve learned in the last two years and reshaping it in a way that’s meaningful and usable by the average retail user,” said Song.

Read more: USDC Added to Hedera Hashgraph as Enterprise-Minded Network Eyes DeFi

Fleshing out the Hedera’s fledgling ecosystem will be key infrastructure within “the next quarter or two quarters,” including a lending platform, oracle services and DAO tooling, though Song declined to specify specific protocols.