Ethereum has undergone a large transformation in the past four years, starting as a network capable of managing only 15 transactions per second, and evolving towards a central treatment of the thousands, the transaction costs from $ 50 per exchange to single hundred. The L2 and the rollers helped to evolve Ethereum without compromising its decentralized philosophy. But this success has led to a new problem, that of fragmentation.
Today, Ethereum is one of the most adopted blockchains, consisting of a network of more than 50 L2, each operating as their own partitioned ecosystem. This means for end users, it is to juggle several networks, asset bridge and navigate a maze of processes just to carry out basic actions.
Reflecting the fragmented technological landscape, the Ethereum financing landscape has become difficult to sail for manufacturers throughout the life cycle, blocking innovation while projects are struggling to obtain sustainable funding.
To create a more effective ecosystem, Ethereum must start to adopt financing mechanisms based on blockchain which are better aligned with its complex, community and experimental nature.
Traditional financing programs often focus on early stage projects, neglecting the long -term needs of manufacturers in web3. It may be misleading to look at the accounts of the cryptography market dominating the investment landscape and assume a booming activity. Many of these projects financial returns may not arrive in the short term, leaving manufacturers who have trouble sailing towards sustainable growth. The funding mechanisms must be able to support manufacturers throughout the product life cycle.
Rewarding impact, no speculation
Retopgf is one of the most promising financing models powered by the most promising blockchain, which returns the traditional financing script by rewarding projects according to their proven impact rather than their speculative potential. This model is particularly well suited to the fragmented ecosystem of Ethereum, where public goods such as open source software, developer tools and interoperability solutions often find it difficult to attract initial investment.
Retopgf focuses on the measurable results of a project. It pools the funds of DAOs or ecosystem contributors and retroactively distributes them to projects that have demonstrated a value. This process guarantees that critical infrastructure – such as transversal bridges or developer executives – receive the support it needs at the right time.
This financing mechanism is preferred because it helps align incentives. Instead of competing for speculative investments, projects can focus on the offer of real value, knowing that their contributions will be recognized and rewarded. For a fragmented ecosystem like Ethereum, Retopgf offers a means of unifying financing efforts and guaranteeing that resources pass towards the most impactful initiatives.
Amplifying community support
Another powerful tool in the blockchain financing toolbox is quadratic funding, a model that distributes capital according to the extent of community support rather than the size of individual contributions. This approach levels the rules of the game for small projects and basic initiatives, which often find it difficult to compete with competitors well funded in traditional funding models.
Quadratic funding operates by matching the small donations of a large number of supporters with a larger basin of funds, reflecting the collective intelligence of the community and ensuring that projects with basic support receive the majority of funding.
By throwing the value of public goods projects, such as governance rights or sources of income, the founders can open their projects to a wider supporting pool using fractional investment mechanisms. This creates a diversified and passionate investor base, democratizing access to capital and reducing dependence on traditional sources of funding.
For example, developers creating a cross interoperability solution could tokensize the governance rights of their project, allowing supporters to contribute micro-investments in exchange for a game in its success. This does not only provide the project essential funding, but also promotes a feeling of belonging and alignment among its supporters.
In a fragmented ecosystem like Ethereum, fractional investment can help fill the gaps between channels by encouraging collaboration and shared property. Projects that could otherwise operate in isolation can draw from a unified capital pool, creating a more interconnected and resilient ecosystem.
Chain property
At the heart of these financing models powered by the blockchain is the concept of chain property. By throwing their work and taking advantage of the transparency of blockchain, creators and manufacturers can establish direct relations with their supporters, eliminate intermediaries and guarantee that this value comes to those who believed it from the start.
Chain transactions also make financing flows visible and verifiable, reducing fraud and promoting confidence. This transparency is particularly important in a fragmented ecosystem like Ethereum, where users and developers often have trouble navigating in complex and opaque financing structures.
An important question to be tackled is how to find funding for these X-L2 initiatives.
A strategy is to finance Ethereum common goods as a condition of being a roller of stadium 1 or stadium. These rollers, once they have reached this level of decentralization, rely on a distributed community and governance tools. The financing of these common goods and tools is not only justified but necessary for their continuous growth.
An alternative would be to redirect the subsidy program of the Ethereum Foundation to solve this problem. The EF must better support the cross-l2 experience and the financing of common goods to resolve these challenges is essential to do so.
The fragmentation of Ethereum goes beyond technical challenges, it is a challenge of financing above all the others. By adopting financing models powered by blockchain such as Retopost, quadratic funding and fractional investment, the ecosystem offers a means of aligning incentives, amplifying community support and democratizing access to capital, ensuring that resources take place towards projects that need it most.
