Ecosystem Investment

Definition ∞ Ecosystem investment refers to capital allocated to support the growth and development of a blockchain network’s associated applications, infrastructure, and community. This funding is directed toward projects that enhance the utility, adoption, and overall value proposition of a given blockchain ecosystem. Such investments are crucial for fostering innovation and network effects.
Context ∞ Current discussions on ecosystem investment are largely centered on the strategic allocation of treasury funds by decentralized autonomous organizations (DAOs) and venture capital firms. Key debates involve the criteria for selecting promising projects and the long-term sustainability of these funding mechanisms. A critical future development to observe is the increasing sophistication of grant programs and the emergence of more decentralized funding models.