Polychain, Web3 to Back Polkadot Projects With New Ecosystem Fund

"The investment committee is looking for projects that will add long-term value to the Polkadot ecosystem."

AccessTimeIconOct 29, 2019 at 9:00 p.m. UTC
Updated Sep 13, 2021 at 11:38 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Polychain Capital is partnering with the Web3 Foundation to launch a new investment fund for projects building atop the Polkadot network.

The creators of the Polkadot Ecosystem Fund wouldn’t specify how much was committed but did characterize it as “in the millions” in an interview with CoinDesk.

Expected to formally launch later this year, Polkadot is envisioned as an interoperable proof-of-stake (PoS) blockchain network. It is being developed by the Swiss Web3 Foundation in close collaboration with blockchain startup Parity Technologies, which is led by ethereum co-founder Gavin Wood.

As previously reported, the Web3 Foundation sought a $1.2 billion valuation for the project through multiple token sales from investors (including Polychain Capital). How much was ultimately raised by the project has not been disclosed.

“There's a track record of successful collaborations [with Polychain] that we want to continue,” Web3 Foundation communications lead Zeke Turner said via email, adding:

“The investment committee is looking for projects that will add long-term value to the Polkadot ecosystem.”

Speaking to the size of the fund, Turner said it’s “in the order of millions and can be recapitalized at any stage depending on the supply of investment targets.”

He also said that unlike grant funding, where payment is strictly one-way, investments from the Polkadot Ecosystem Fund may require a percentage of equity from participating startups.

“It’s safe to assume there’s some transfer of value in both directions to align long-term incentives,” said Turner.

Other initiatives

Since last December, the Web3 Foundation has been issuing grants to projects using Polkadot’s blockchain application framework, Substrate.

Now on its fourth wave of grants, over 40 projects have been funded in total by the non-profit with amounts ranging from $3,000 to $100,000 per grant.

, Web3 Foundation launched an experimental version of Polkadot called Kusama for early application developers and validators to test out. Kusama most recently enabled staking, that is, the ability for users to earn rewards for validating transactions and processing blocks on the network.

In a statement, Wood, who is also president of Web3 Foundation, said he sees the Polkadot Ecosystem Fund as “an important outlet for teams at all stages to get the support they need.”

To this, Polychain Chief Investment Officer Olaf Carlson-Wee added:

“We are excited to invest and partner with hardcore engineers and entrepreneurs to catalyze the development of economic software built for Polkadot.”

 Polychain Capital's Olaf Carlson-Wee image via CoinDesk archives

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.