Evolving NEAR Foundation’s Funding Strategy
November 21, 2022 — NEAR Team
NEAR Foundation is publishing a series of blogs on the state of funding, including updates from the Grants Team and an upcoming Transparency Report for Q3. This is part of our continued commitment to transparency, as well as more frequent and open communication with the NEAR community.
NEAR Foundation’s role is to support the NEAR ecosystem and community. This means that the Foundation can deploy capital to help promote growth, alongside its efforts to grow awareness of NEAR and onboard a billion users to Web3.
Among Layer 1 protocols, NEAR is in an excellent position to thrive despite the very difficult market conditions. Our 5+ years of runway will help the NEAR ecosystem weather the bear market, which is likely to last for some time. The Treasury Team’s careful spending and responsible Treasury management has equipped the ecosystem to emerge from this crypto winter with NEAR as the protocol of choice for people and projects building on Web3.
While the market has created a new reality for the entire Web3 ecosystem, NEAR sees this as a moment of great opportunity and a time to stick to our convictions. We’ve outlined the Foundation’s new strategy around facilitating Web2.5 and making NEAR the de facto bridge from Web2 to Web3.
Staying true to NEAR’s decentralized vision, the NEAR Digital Collective (NDC) was recently launched and led by the Governance Working Group (GWG). We’ve also delegated some decision-making to the community through grassroots DAOs: the DeveloperDAO, MarketingDAO, and CreativesDAO.
NEAR Foundation has provided capital to many projects over the last two-plus years, with clear milestones and goals designed to maximize potential value added to the ecosystem. Grants have been a major part of that capital allocation strategy since the program was first announced in 2021. Although the Foundation has a substantial amount of runway to support the ecosystem for several years to come, we need to ensure that we are stewarding NEAR’s Treasury as responsibly and sustainably as possible.
With these long-term views in mind, NEAR Foundation is looking critically at all of its capital allocation in the last few years in order to determine what has had the most impact and where we should consider revising our approach. We will also be heavily scrutinizing upcoming capital deployments. The Foundation must focus on supporting the highest quality projects with the most potential and alignment with our vision for NEAR.
What does this mean for the community? To make NEAR the leading Web2.5 bridge, NEAR Foundation will back those projects and initiatives that help best grow and support the ecosystem for years to come. This also means that some tough decisions are coming about where not to deploy funding.
However, in the areas where funding or granting is pared back, the Foundation will do its absolute best to support those affected by upcoming funding decisions. We will make our best efforts to help these community members find new homes with other ecosystem projects.
NEAR Foundation will also ensure that we are as transparent as possible about the new Funding strategy as it rolls out. The Foundation will communicate as often and as much as possible, and encourage the community to continue giving feedback so we can iterate more quickly as we build the NEAR Ecosystem together.
NEAR Foundation has already made significant steps to make NEAR’s funding more transparent. Through the NEAR Digital Collective (NDC), we are empowering the community to evolve governance and coordinate together through the ecosystem DAOs. (Read more and get involved at the NDC gov.near.org page.) In September, NEAR formed a working group to set standards for this on-chain style of self-governance. The Foundation has been calling this the “bottom-up” approach to supporting the community, encouraging grassroots coordination and decentralized decision-making that works in parallel with the Foundation’s more “top-down” stewardship and funding strategy.
The Foundation also started publishing a regular Transparency Report in the spirit of accountability to the ecosystem. The first Transparency report, which came out just before NEARCON, was an important start—but we want to make it even better for the community. The next report will be coming out in a couple of weeks and will include more granularity where possible. You can also check out a recent update from the NEAR Grants team titled “Funding Beyond Grants”.
It’s also important for the community to understand that while transparency and open communication are an essential part of NEAR Foundation’s commitment to all of you, we cannot be entirely transparent about every funding decision or commercial agreement we make. This is primarily due to legal restrictions that can be imposed on NEAR Foundation in its dealings with third parties. The Foundation will share as much as possible about the exciting collaborations being made in the months ahead.
NEAR Foundation highly encourages people to get involved with the NEAR community. By becoming more participatory, community members can take ownership in the new bottom-up approach to decision making we are helping foster across the ecosystem.
NEAR Foundation is keeping an eye on the long term for the entire NEAR ecosystem. By being fiscally responsible and deploying capital in a sustainable way, the Foundation can ensure that NEAR emerges from this bear market stronger than ever, and well positioned to help builders keep building the future of Web3.
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