Fantom bets on ‘safer memecoins’ with launch of $6.5M dev fund

Avatar

Layer-1 blockchain Fantom is pushing the idea of “safer memecoins” by setting aside $6.5 million worth of its native FTM (FTM) token as a reward to devs as it tries to get a slice of the nearly $50 billion sector.

Fantom Foundation CEO Michael Kong told Cointelegraph he wants to create “an environment where people can launch what we call ‘safer memecoins’” and introduce technical and non-technical measures to ensure projects aren’t “just an outright rug or scam.”

Solana and Coinbase’s Ethereum layer 2 Base have seen the bulk of the recent memecoin trading craze with trading volumes on Solana even surpassing Ethereum’s at the peak of the memecoin rush in March.

However, as many as one in six of memecoins on Base were revealed to be scams and at least 12 sizeable meme-based projects on Solana — which raised a combined $26.7 million — were quickly abandoned by their creators.

In a bid to attract memecoin traders to Fantom as well as increasing safety measures around the tokens, Kong announced during the April 30 MemeGlobal event in Sydney that the Fantom Foundation was setting up a 10 million Fantom (FTM) prize pool — worth $6.5 million — to memecoin teams.

“The memecoin phenomenon that exists right now is a method for us to acquire a lot of customers because we’ve seen that be successful with other chains and we want to replicate that success,” Kong said.

“For us as a chain, our interest is to grow the chain as much as possible and that comes down to customer acquisition,” Kong added.

“In the end, it’s about what the customer wants. If the customer wants DeFi, give them DeFi. NFTs? Give them NFTs, and when it comes to memecoins, give them memecoins — or at least an environment that allows people to develop memecoins in a safe manner.”

Kong described a successful memecoin as one with a “democratic launch where you release a lot of tokens to give to the community” and aren’t “heavily concentrated in a few whales or a few bags.”

Michael Kong speaking on a panel at MemeGlobal Sydney. Source: Jesse Coghlan/Cointelegraph

The Foundation’s co-founder Andre Cronje proposed measures for safe memecoins earlier in April including memecoin devs issuing their token with the Fanton Foundation as a co-controller of the token’s startup liquidity.

Related: Crypto VC sees a ‘new class’ of profitable memecoins this cycle

Cronje also proposed the token supply split — 5% to the team and 10% for marketing that’s locked in a multi-sig wallet needing at least one Foundation member as a co-signer.

The remaining 85% would be placed in an FTM paired liquidity pool (LP) with the Foundation pitching in 100,000 FTM — worth around $65,000 at current prices.

“Should the FTM in the LP token reach at least 2,000,000 FTM, the original provided 100,000 FTM (5%) will be removed to cover the initial cost and the rest of the LP will be burned,” Cronje wrote.

Fantom is the 38th largest blockchain network with a total value locked (TVL) of $108.3 million, according to DefiLlama. For comparison, Solana and Base are respectively the fourth and sixth largest by TVL.

Magazine: 1 in 6 new Base meme coins are scams, 91% have vulnerabilities