Introducing the HBAR Foundation Crypto Economy Fund

“Blockchain, not crypto” is a distinction often made in an attempt to delineate the scalability of the underlying technology from that of the crypto use case. Today, we see the need to blur that separation - it must scale efficiently, in all of its forms. Hedera, as an enterprise-grade network made for power users, is perfectly suited to enable crypto to become the norm. 

To this end, the HBAR Foundation has allocated $155M over the course of 2022 and created the below strategy to grow the HBAR and broader crypto economy.

Introducing the Crypto Economy Fund

What we call ourselves is an important signal of our intent. Instead of the “Defi Fund” focused on specific application types, the Crypto Economy Fund enables the two basic economic behaviors of production and consumption.

Within crypto, we have seen further segmentation along this spectrum: Build, Use, Trade, Invest. Contextualizing the tech stack depicted in the broader THF strategy within these categories ensures we’re both sharp and flexible in achieving better product market fit. Our specific goals for each behavior category and 2022 focus areas below: 

Build: improve tooling that Web3 founders need to build on Hedera - oracles, indexing, node infrastructure, Web3 wallets, DAO tooling, and fiat onramps.

Use: enable utility of HBAR and native Hedera tokens through integrations with new platforms and partners - USDC on Hedera, custodians, hardware wallets. 

Trade: advance both the diversity and strength of markets built on Hedera - centralized/orderbook, decentralized, synthetic, security, market infrastructure. 

Invest: prioritize Hedera “composability” that will enable defi utility - decentralized liquidity, yield generation, interoperability. 

2022 Strategic Initiatives

We’ve prioritized several key initiatives to accelerate growth of the Hedera network and crypto economy. 

The first is increasing mainstream retail access for certain user demographics. We will mature the US retail market, for both residents and USD accessibility and embrace retail-focused platforms and payment methods such as mobile apps and credit card purchase. 

The second is establishing yield generation opportunities in a modular manner. Our partnership with Stader will ensure staking is a common feature on various dapps, wallets, exchanges within the Hedera ecosystem. 

The third is strengthening both centralized and decentralized liquidity. To that end, we’ve allocated $60M from the Crypto Economy Fund for DEX liquidity rewards. 

Conclusion

As we build the crypto economy on Hedera, we have two asks of our community. First, continue to share your feedback with us. While there are many things we cannot comment on, you can assume that we’re either already on it or looking for ways to pursue an opportunity.

Second, come pitch us your ideas and apply for grants! We’re looking for projects that are milestone-driven and incentive-aligned. 

Our goals are lofty, and we’ll likely miss some targets. But we believe this approach laid out above is the most effective way to learn from and engage with our peers, while responding to needs articulated by the community.