VeBetterDAO: Optimizing Weekly dApp Allocation to Encourage Innovation and Growth

VeBetterDAO
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Background & Purpose

Recently, some low-quality dApps in the VeBetterDAO ecosystem have claimed the minimum allocation, then exited while keeping the tokens, without contributing to the ecosystem. This has resulted in inefficient fund utilization and has disadvantaged truly innovative and active dApps. To ensure that resources are allocated to high-value and growth-oriented projects, we plan to adjust the Weekly dApp Allocation mechanism, promoting a more competitive and sustainable ecosystem.

Current Minimum Allocation Mechanism

Currently, VeBetterDAO distributes dApp allocations as follows:

  • 30% is allocated as a minimum allocation, equally distributed among all eligible dApps to provide baseline funding.
  • 70% is distributed based on community voting, allowing popular dApps to receive higher rewards.

While the minimum allocation was initially intended to help new dApps during their early stages, some projects have exploited the system by claiming funds without updates or long-term commitment. To prevent resource inefficiency, we propose eliminating the minimum allocation and replacing it with a more effective support mechanism.

Optimization Plan: Removing Minimum Allocation & Introducing VBD Grant

To address these issues, we propose the following changes:

  1. Remove the minimum allocation, ensuring that only actively contributing dApps receive funding.
  2. Introduce VBD Grant to support new dApps, providing initial funding to projects with real potential.
    • VBD Grant will be subject to community voting, ensuring that funds go to high-value projects.
    • The Foundation will establish a structured Grant program, ensuring a fair and transparent selection process.
    • The Grant will provide a fixed, limited amount of startup funding, preventing abuse while encouraging dApps to enter the competitive ecosystem.
  3. The 40% allocation from the X-Allocation Pool will now be entirely distributed based on votes, motivating dApps to engage in development and community activities to earn support, rather than relying on guaranteed funding.

Key Benefits of This Change

  • Prevents low-quality dApps from exploiting the system, ensuring more effective resource allocation.
  • Encourages dApps to compete based on innovation and community support, fostering a more dynamic ecosystem.
  • Ensures fairness through a structured Grant program managed by the Foundation, enhancing transparency.
  • Optimizes the use of DAO funds, allowing higher rewards for impactful dApps.

This adjustment will help build a more sustainable and innovation-driven VeBetterDAO ecosystem, ensuring that funding is directed toward projects that contribute to long-term growth.

3 Likes
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Can you share more details of the grant? new apps rely on the minimum allocation to get through the 1st few weeks or so

1 Like
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It was designed to give new X2E apps a bootstrapping boost. Now with more and more X2E applications joining VBD, it’s the right time to remove basica allocation and motivate good X2E apps to perform to gain the support from community.

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Good idea. How will this impact the max allocation?

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The max cap is 20%.
QF is based on number of voting wallets + square root token amount.
High tier dApps will receive a bit more than before.
Low tier dApps will receive less.

dApps needs to keep improving to get more votes.

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Following the recent proposal to remove the minimum allocation in VeBetterDAO, an important question arises—how can we ensure that promising new projects still receive the early-stage support they need to thrive?

Without initial visibility or incentives, high-quality dApps may struggle to gain traction in their critical early phases, ultimately limiting ecosystem diversity and growth.

To address this challenge, we propose strengthening two vital pillars of support:

:compass: 1. Visibility for New Projects

Ensuring that innovative dApps are brought to the community’s attention through featured placements, AMAs, or dedicated community showcases.

:money_bag: 2. A Structured Grant Funding Channel

Introducing a clear and transparent Grant Program to support early-stage development, rewarding ideas with real potential to contribute to the VeChain ecosystem.

:hammer_and_wrench: Proposed Grant Program Flow

Step 1: Application Submission

Projects apply for a grant by submitting relevant information, including a business plan, team overview, and value proposition.

Step 2: Review & Shortlisting

The Grant Team, comprising Foundation members and subject matter experts, evaluates submissions and engages with strong candidates to refine proposals.

Step 3: Community Voting Preparation

Once approved, the VeChain Foundation purchases the necessary B3TR tokens to bring the grant proposal into the VeBetterDAO voting stage.

Step 4: VOT3 Holder Vote

VOT3 holders vote on the proposal.

  • If approved, funds are released from the treasury.

  • For milestone-based grants, remaining funds are held in the Foundation wallet and released based on project deliverables, with ongoing oversight by the Grant Team.

:puzzle_piece: Milestone Flexibility: Making Grants Developer-Friendly

Some smaller teams may worry that traditional milestone expectations—such as high user counts—could be difficult to meet early on. To address this, we propose a multi-dimensional milestone evaluation framework that provides more flexibility while still ensuring accountability.

:pushpin: Sample Milestone Criteria (applicants may propose a combination):

  • Product Development Progress: Alpha/beta version online, core features completed, smart contracts audited, etc.

  • Community Growth: Early user traction, community activity, feedback mechanisms.

  • Ecosystem Integration: Collaborations with other VeChain dApps or real-world use cases.

  • Go-to-Market & Communication: Clear marketing strategy, participation in community events or AMAs.

Projects may also submit a custom growth path during application, outlining realistic, measurable goals tailored to their stage and vision.

This design allows grants to be distributed in phases, aligning with each project’s development journey while avoiding one-size-fits-all expectations.

:bullseye: Key Benefits

  • Early Support for Builders: Helps innovative dApps gain recognition and funding before they can rely solely on votes.

  • Informed Community Decisions: Proposals are backed by business plans and reviewed by a qualified team, enabling voters to make better decisions.

  • Accountability & Milestone Tracking: Ensures transparency and measurable progress with flexible deliverables.

  • Ecosystem Growth: Encourages long-term innovation, rather than short-term opportunism.

:loudspeaker: Call for Feedback

We believe this framework strikes a balance between supporting new dApps and preserving the DAO’s meritocratic principles. It ensures high-potential projects are given a fair chance to succeed—without diluting the importance of community-driven decision-making.

We’d love to hear your thoughts:

  • Are there areas we could simplify or improve?

  • What should be the core criteria for grant eligibility?

  • How can we best promote and track supported projects?