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Fantom to Fund Ecosystem Projects Using Portion of Burn Fees
A governance vote saw an overwhelming number of community members in favor of using one-third of Fantom’s burn fees to fund new projects.
Fantom community members have passed a governance vote that proposed using one-third of the network’s burn fees to fund new projects built in the Fantom ecosystem. Nearly 100% of all votes cast were in favor of the plan.
The proposal had been scheduled to run until Oct. 3, but voting closed after support crossed the minimum 55% requirement.
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Fantom currently burns – i.e., permanently removes from circulation – 30% of all tokens that are paid as network fees. Following the vote, one-third of that 30% fee value would be submitted to an “Ecosystem Support Vault” held via a Special Fee Contract (SFC).
The SFC is controlled by the Fantom network validators and stakers via on-chain governance and community proposals. The remaining two-thirds of transaction fees would be burned as usual.
Payments will initially be manually executed via the Fantom Foundation, using tools such as LlamaPay, to fund projects whose proposals are approved by the Ecosystem Vault.
Developers say community members must add vesting periods to the payments to ensure project founders are incentivized to work continuously, instead of receiving the payments at once and possibly losing interest.
Risks outlined by the now-passed proposal include malicious approvals of projects requesting funds from the Ecosystem Vault, influential entities or groups funding themselves or promoting projects they control and a project that overpromises and cannot deliver with the received funds.
Measures, however, are in place to combat those risks. “Fantom reserves the right to halt any payment stream indefinitely if fraudulent user activity is suspected or if the Foundation believes it presents a negative risk to the Fantom ecosystem,” developers said in the proposal.
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