The Fantom Foundation has announced a huge incentive program to encourage developers and projects to build on the Fantom network.
Through the program, Fantom has committed a total of 370 million FTM (approximately $314m) to distribute to both new and existing projects and aid protocol teams in their developments on Fantom.
Announcing a 370 million FTM incentive program for builders!
If you're a protocol team, we'll reward you for sustaining and increasing your TVL on Fantom.
— Fantom Foundation (@FantomFDN) August 30, 2021
To receive the incentives, teams can apply to the Fantom Foundation, with the rewards received based on the total value locked (TVL). The rewards scale from one million FTM up to five million FTM in its first iteration and remain dynamic to fit the needs of developers.
To maintain the reward structure, the program will use a time-weighted average (TWA) to calculate the amount distributed. The TVL of a protocol must remain between $5,000,000 – $100,000,000 for an extended period of time to receive rewards.
Fantom noted that it was using this format to open up the Fantom Foundation to developers and to encourage growth and liquidity on the network. It’s hoped that this will lead to “massive interest in developing on Fantom”, with project teams able to “best decide how to use the rewards”.
Simone Pomposi, head of Marketing at Fantom Foundation, expanded on the decision to offer rewards to developers rather than provide a liquidity mining incentive like competing blockchains such as Avalanche and Celo.
“We’ve seen a lot of exciting things going on in regards to liquidity mining,” he said.
“So exciting, that even other foundations behind their respective chains started to provide rewards to users of protocols willing to deploy on top of their chain.
“We’ve been asked to do the same, but we believe that playing by the book doesn’t warrant different results. Therefore we have decided to introduce a different kind of program to better align incentives between users, builders, and the network.”
A growing DeFi presence
According to TVL tracker DefiLlama, the TVL across the Fantom network now totals more than $660m, with many leading DeFi protocols such as SpookySwap and SpiritSwap seeing drastic increases in their TVL almost overnight following the announcement of the incentives.
Fantom has proven popular with DeFi users due to its fast and scalable layer-1 smart contract platform, which enables one-second transactions and near-zero fees for users and developers.
The increased on-chain DeFi activity has coincided with the upwards price action of Fantom. From a recent low of $0.41 on August 27, the price on Fantom has now rallied over 100% to recent highs of $0.90 on August 30.
Fantom is now consolidating in the $0.80 – $0.85 range, with further upside towards its all-time high of $0.95 expected in the coming weeks.