As the bear market keeps slashing venture capital from the crypto industry, alternative funding options, such as grants, have been gaining traction as a means of supporting the community while enabling the growth of established projects in a challenging crypto environment.
According to Blockchain Grants, at least 40 crypto projects are currently offering grants for developers working on Web3 solutions, while data from Cointelegraph Research indicates that the market downturn has left a void in crypto venture capital, resulting in a 30% drop in funds injected into Web3 projects over the past 12 months.
Grants and venture capital are two different funding mechanisms with distinct purposes and conditions. While grants are often used to support projects that align with specific objectives and values, venture capital seeks startups with high-growth potential and focus on financial returns.
Yet, receiving grants may only be beneficial for projects if funds are put back into the work, Cumberland Labs CEO Naveen Agnihotri told Cointelegraph. “Grants can be especially helpful for the up-and-coming crypto projects, but only if the funds are put back into the work,” noted Agnihotri, adding that venture capital, otherwise, “can help a founder bootstrap his or her project with a rather helpful style because both parties have been incentives to engage in such a way.”
Open call for grants
With the goal of keeping projects accountable for funds received while fostering innovation, the SingularityNET team has updated its Deep Funding grant program. Following the recent opening of its third round, the program now will reward teams based on milestones achieved and deliverables, as well as peer-to-peer revisions. Until Sept. 3, the program will receive proposals for five funding pools and plans to distribute over $1.5 million to AI-related projects in the coming months.
“Granting programs hold a pivotal role in shaping the crypto industry’s next phase of development and innovation. By offering financial support and a platform for unconventional ideas, these programs fuel creativity, research, and the creation of pioneering solutions,” noted Rafael Presa, operations manager of Deep Funding. Since its inception in 2022, the program has helped 28 AI projects, with grants distributed through decentralized voting within the SingularityNET ecosystem.
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