Some of the world's largest blockchain foundations and enterprises often provide grants to developers to finance their development.
In short, first of all, grants are described as a form of free funds. Some developers who can complete cutting-edge breakthroughs can get it, no matter how this form is presented: educating the public, making the network safer, and enhancing the core infrastructure of the blockchain so that it can handle more affairs every second.
According to the organization's funding procedures, many dollars of funds may be threatened. The payee usually needs to apply for unlocking funds, which is usually time-consuming. Strict eligibility criteria may also come into effect, which means that the Committee may be responsible for making decisions on the future direction of the platform.
2. What are the shortcomings of the blockchain community grant?
Grants do not always involve community members, and in some cases, the process may be quite opaque.
Ryan Rettig said in an article a few months ago: "I haven't seen a funded project that works well in the blockchain field."
Considering that grants are widely used in the whole industry, these seem to be a bad sign. Rettig believes that these projects often make communities deviate from centralization. In this way, logarithmic organizations not only finally determined the development agenda, but in many cases, the founders finally provided huge financial support to people they already knew. Taking the Ethereum Foundation as an example, he pointed out: "Some of the biggest grants have been awarded to projects led by close friends of Vitalik Buterin."
Retiger said that the purpose of launching this funding is to maintain an innovation without any commercial purpose, which he described as a "blockchain superpower". In this way, ordinary people can dig up cryptocurrencies such as Bitcoin from their laptops at home, without using credit cards or passing KYC checks.
Ultimately, the main risk associated with funding is that those who have useful ideas but are limited by traditional processes may miss funding. More complex concepts may eventually be rejected and ignored because they are not suitable for the "strict indicators" of funding schemes. Allegations of "nepotism" and "unfairness" may start to spread everywhere. To make matters worse, most community members began to feel that they had no say in the future direction of the ecosystem.
3. Why is competition a better choice?
Of course, some advocates believe that it is a better choice to ensure the circulation of tokens through competition mechanism.
If the subsidy is money used to fulfill the promise, then the competition mechanism can be regarded as a reward for fulfilling the contribution. Supporters say that in the long run, its impact is much better than funding.
The competition mechanism creates a competitive environment. Anyone in the community can freely express their views, and other members can vote for their favorite projects and ideas. They can also lead to discussions to improve the final product. Competition to build a new website may lead to heated debates on other powerful ideas to raise awareness-more competition, so that these concepts can also be used.
Another powerful advantage lies in how these competitions are open to everyone-no matter where they live, what their background is, or who they are connected with.
4. How can the competition help the encryption community become healthier?
Supporters believe that they help unite communities, promote participation and attract new users.
For the winner of the competition, the winning income far exceeds the monetary income. With the expansion of the network scale, they can vividly see their contributions and know how their work helps the blockchain to promote the development of the blockchain.
Let everyone have the right to speak and produce many positive contributors, not passive users.
They can also innovate faster, and competition can make smaller batches of tokens distributed to winners faster. This is in sharp contrast to the appropriation, which may take several months to be approved.