Reports said that the Flow ecosystem is set to get a boost in support from a new $725 million fund that will be used to invest in the growth of the nonfungible token network.
It has been reported that Flow (FLOW) is a layer-1 blockchain developed by Dapper Labs and purpose-made for nonfungible tokens (NFTs). Dapper Labs also created the popular NBA Top Shot NFT collection. Flow utilizes an eco-friendly proof-of-stake (PoS) consensus algorithm.
However, the new fund was backed by 17 firms that have experience backing other Web3 companies, including large investment firms a16z, Spartan Group, and CoinFund. The funds will be used to attract developers to bring their work onto Flow instead of competitor Ethereum, which still dominates NFTs despite high gas fees. Within the Flow ecosystem itself, the funds will provide support for gaming, infrastructure, decentralized finance (DeFi), content, and creators.
The report said that projects awarded grants through the ecosystem fund will be supported by FLOW tokens investments and what the fund’s webpage calls “in-kind support.”
Roham Gharegozlou, the CEO of Flow, clarified that the majority of the fund will be used as investment capital rather than grants for developers. Flow is currently the third-largest blockchain by NFT sales volume behind Ethereum and Solana. Not including May, throughout 2022, Flow has averaged $50.3 million in monthly NFT sales, according to CryptoSlam, an NFT market tracker.
Likewise, the host of the NFT-focused podcast The First Mint LG Doucet tweeted on Tuesday a list of five new products he believes should be supported through the funds. They include a whitelisted app to help users get whitelisted for a mint, a mobile app, video education, wallet integration on Shopify, non-cartoon, animal and athlete art.
He added that Flow needs “actual INNOVATION, not just roadmaps that copy ETH projects.” Although Flow is operated by Dapper Labs, which has produced some of the biggest NFT products over the last two years, its NFT sales still lag behind larger layer-1 ecosystems. This may be due to weaker network effects and a smaller ecosystem of decentralized applications (DApps) running on it.
Thus, other Dapper Labs NFT products include CryptoKitties, one of the first NFT games, UFC Strike, NFL All Day, and Cheeze Wizards. FLOW has a market cap of $1.4 billion and is up 20% over the past 24 hours to $4.01, according to CoinGecko data.