TEC Grant Program Analysis & Framework Proposal

❇️ Grants Program
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Introduction

Over the past few years, Ethereum based grant programs such as Gitcoin, Octant, clr.fund, the Ethereum Foundation, and others have helped energize the ecosystem by supporting early-stage teams, surfacing new ideas, and funding public goods experiments. This burst of experimentation has been essential, and the Token Engineering Commons has actively contributed to it through Gitcoin Community Rounds and other initiatives. But as the space matures, we are starting to see that the flaws in the current model are becoming more visible. Fragmentation, short-termism, unstable funding sources, and a heavy reliance on visibility over impact have made it harder for meaningful projects to sustain momentum.

For grantees, it often means chasing multiple small rounds to fund a single roadmap. For sponsors, it means scattering funds without continuity or clear outcomes. And for the ecosystem as a whole, it means we’re still lacking a coordinated, durable strategy for public goods funding. This retrospective evaluation takes a critical look at where TEC’s past efforts have fit within that broader context, and introduces a new framework built to address these challenges directly. A Grant Program rooted in long-term thinking, structured participation, and a sustainable approach to ecosystem funding.

The Role and Function of the TEC Grant Program

The TEC Grant Program has been a strategic catalyst for ecosystem development, designed to advance the mission of the Token Engineering Commons to steward the creation and sustainability of public goods in the field of token engineering. At its core, this program has served not just as a mechanism for funding projects, but an expression of our values, a vehicle for community-led innovation, and a practical tool for gaining legitimacy.

By catalyzing and coordinating the production of shared infrastructure, research, and tools, the Grant Program has acted as both a scaffold and amplifier for the broader token engineering ecosystem. It has created a space for experimentation and collaboration across disciplines. It has lowered the barrier to entry for new contributors and incentivizes continued involvement from those already working at the frontier.

In this sense, the Grant Program is a means to an end for the Commons. The end being the robust, coordinated, and widely adopted development of token engineering public goods. These include formal methods, simulation tools, governance primitives, educational resources, and open-source libraries, all of which are foundational to the creation of safe, effective, and regenerative crypto-economic systems.

Beyond supporting individual projects, the TEC Grant Program has served as a signaling layer. It has allowed us to surface emergent priorities, map the knowledge gaps in our ecosystem, and demonstrate strategic coherence to the wider Web3 landscape. Through careful curation and transparent decision-making, the program has helped us establish thought leadership and authority in an increasingly crowded crypto space.

Importantly, this program has also acted as an internal alignment mechanism. By funding what we believe matters, we clarify our own values. The lessons we learn from running the program, understanding what works, what doesn’t, and who shows up, feeds directly into how we evolve as an organization and as a community. In short, what we fund externally shapes what we are able to build internally.

The TEC Grant Program is how we grow the Commons. Not only through capital distribution, but through relationship formation and coordination practice. It is our way of operationalizing care for the field, for the builders, and for the Commons.

Grant Program Long-Term Goals

The ideal grant program for the TEC is one that not only funds impactful work today, but creates the structural and economic conditions for self-sustaining funding into the future. To that end, our long-term vision is anchored in three interlocking goals: solving our financial support infrastructure, embedding token utility into the core of our program design, and deepening post-grant support through our growing TE Network. Each of these represents a pillar of resilience and intentionality forming the foundation of an evolving grant program.

Goal #1: Solve Our Financial Support Infrastructure

Our first priority is the creation of a predictable and value-aligned funding base.

Historically, one of the greatest challenges facing onchain grants ecosystems, and for our Grant Program in particular, has been the irregular and fragile nature of funding. Grant rounds often depend on one-time donations, last-minute sponsor outreach, or the draining of our Common Pool. This creates not only burnout for organizers but a strategic shortfall for long-term planning.

To solve this, we are exploring sustainable revenue-sharing partnerships with long-term stakeholders in the Ethereum and broader Web3 ecosystem. Specifically, those with significant passive income from infrastructure participation. We believe that large Ethereum validators, node operators, and other protocol-layer beneficiaries represent a largely untapped class of potential funders. Many of these actors, especially those not active in staking-as-a-service markets, maintain dedicated treasuries and corporate stakes separate from client-facing revenue, and they are under increasing pressure to contribute back to the ecosystems they profit from.

We intend to offer these validators and centralized infrastructure providers a meaningful and reputationally-aligned way to support open infrastructure through the TEC. Unlike many generalized grant platforms, TEC is not building a profit-maximizing product or tokenized marketplace. We are building foundational infrastructure and knowledge to enable the safe design and deployment of crypto-economic systems, and towards a body of work that will ultimately make their own operations more secure, resilient, and valuable.

By positioning TEC Grant Program as an R&D funding platform for future-proofing Ethereum economics, and offering aligned stakeholders a clear channel to support that work, we can begin to build a reliable funding pipeline grounded in mutual interest rather than transactional sponsorship.

Goal #2: Embed Token Utility Within the Grant Program

The TEC is already unique in its treasury architecture, thanks to the Augmented Bonding Curve (ABC), which creates a regenerative funding loop through the community’s own participation. But architecture alone is not enough. In order to activate this engine, we must embed meaningful utility for the $TEC token directly into the grant program’s design and operations.

Utility is what transforms our token from a speculative governance asset into a tool for coordination. The TEC Grants Program is the perfect domain for that transformation. Our goal is to create token mechanics that incentivize community curation, reward long-term alignment, and drive sustained engagement with both the token and the grant process.

We envision three initial vectors for $TEC utility within the grant program:

  1. Staking $TEC for Curation Power

Contributors could stake $TEC in support of specific grant applications, signaling quality and helping surface the most promising proposals. This not only creates a mechanism for decentralized due diligence, but also puts skin in the game for curators and grantees alike, with potential to experiment with Conviction Voting (CV), matching multipliers, or reputation-building over time.

  1. Quadratic Funding Boosts with $TEC

While we may use matching pools denominated in other assets, donations in $TEC could receive an amplified impact through quadratic funding boosts. This increases the utility of $TEC while encouraging community members to support what they believe in with the native token.

  1. Voting with $TEC in Grant Governance

$TEC holders can vote on critical aspects of grant program design including matching pool allocations, thematic priorities, or distribution processes. This deepens governance legitimacy and makes the grant program a living expression of our collective intelligence and values.

By embedding $TEC into the grants program in these ways, we transform it from a passive governance token into an active coordination instrument ensuring that our funding decisions reflect not only mission alignment but community voice.

Goal #3: Provide Intimate Support to Grantees through the Token Engineering Network

Funding is only one part of building successful public goods. If we want our grantees to succeed and to build lasting contributions to the Token Engineering discipline we must move beyond transactional support and toward relational investment.

Our third goal is to create a rich post-grant support ecosystem, rooted in the expertise and reach of the broader Token Engineering community. Grantees should not feel like they are building alone, but rather feel like they are building within a guild, surrounded by mentors, reviewers, beta users, collaborators, and future contributors.

This support can take many forms:

  • Grantee Circles for peer-to-peer exchange and coordination across cohorts

  • Mentorship Pairings with experienced token engineers and researchers

  • Integration Pathways to connect grantees with the community’s existing research, tools, and infrastructure

  • Visibility Support including promotion through TEC channels, conference recommendations, and cross-DAO collaborations

Ultimately, our goal is to create a grant program that feels less like a vending machine and more like a community accelerator that supports the whole lifecycle of meaningful public goods development, not just its initial spark.

All three of these long-term goals: financial infrastructure, token utility, and grantee support are deeply interwoven. And none will be achieved all at once. Through iterative rounds, protocol experimentation, and community feedback, we will continue evolving the TEC Grant Program until it becomes a cornerstone of our collective strategy as a reliable, regenerative, and relational mechanism for advancing our mission…

Grant Program Iteration History

Over the last several rounds, the Token Engineering Commons has developed a consistent and reliable practice of running grant rounds that are both strategically grounded and operationally efficient. Our program has matured through continuous experimentation across four key areas of iteration: Funding Sources, Funding Mechanisms, Funding Focus Areas, and beginning in H2 2025, Funding Stage.

These iterative layers represent not just tweaks to our execution, but an evolving thesis about how to fund public goods effectively, and with more accountability. With each round, we’ve become more aligned, more data-informed, and more capable of contributing to the broader evolution of Web3 grantmaking infrastructure.

1. Funding Sources: Expanding the Capital Stack

To date, each of our grant rounds has successfully secured external capital to seed our matching pool, demonstrating the TEC’s ability to attract ecosystem partners who believe in the value of token engineering as a public good.

  • In four of our last five grant rounds, we received Community Round Matching from Gitcoin Grants.

  • In GG19, we secured notable external sponsorships from Ocean Protocol and Arbitrum, expanding our reputation and ability to interface with both protocol teams and ecosystem funds.

Going forward, our focus is on diversifying and stabilizing our funding sources by engaging with validators, protocol treasuries, and philanthropic DAOs who are aligned with TEC’s long-term mission. These strategic partners provide not only capital but legitimacy, reinforcing our position as a catalyst for the creation of high-quality, mission-driven projects in the space.

2. Funding Mechanisms: Innovating with TQF

Our first grant round, marked our entry into the space with a standard QF (Quadratic Funding) mechanism. While QF has proven to be a powerful tool for democratizing capital allocation, we quickly identified a critical need to address its vulnerabilities, especially the dominance of shallow donations and the lack of qualitative assessment.

In response, we introduced and iterated on our own Tunable-Quadratic Funding (TQF) mechanism starting in GG17::

  • TQF combines the pluralism of QF with a curated layer of expert review, enabling deeper legitimacy, better alignment with technical complexity, and defense against sybil and hype dynamics.

  • In H1 we integrated TQF into the Gitcoin Grants Calculator, allowing other round operators to adopt a similar hybrid approach and reinforcing TEC’s role as an innovator in the grants infrastructure space.

  • In recent rounds, we’ve also experimented with retroactive evaluation overlays, adding a “TQF + Retro” dimension to reflect real-world impact rather than only prospective promises.

Our commitment to funding mechanism innovation is ongoing, and we view every round as both a funding exercise and a research opportunity.

3. Funding Focus Areas: Thematic and Strategic Alignment

The TEC Grant Program has always been mission-aligned, but over time we have grown more intentional in defining where and how we deploy funds. Our past rounds have focused on a variety of thematic scopes, including:

  • General Token Engineering: Open grants supporting tooling, research, modeling, and methods development across the field.

  • Token Engineering on Optimism (TE on OP): A more scoped initiative that supported projects applying token engineering principles within the Optimism ecosystem, showcasing our ability to run ecosystem-specific or L2-aligned rounds.

These focus areas help us attract specialized projects, align with ecosystem partners, and ensure our matching funds are channeling attention into high-leverage impact domains.

4. Funding Stage (H2): Tailoring to Maturity Level

In H2 2025, we will begin experimenting with Funding Stage differentiation, recognizing that projects at different points in their lifecycle require different types of support.

Rather than operating all-or-nothing funding rounds, we aim to introduce tiered or stage-aware rounds that allow us to support:

  • Exploratory Research & Prototyping

  • Tooling & Infrastructure MVPs

  • Ecosystem Integration & Adoption

  • Maintenance & Iteration of Existing Public Goods

By explicitly acknowledging project maturity and intent, we can provide more tailored capital, set more relevant expectations, and track impact in a more structured way. This will also open the door to repeat grant pathways, build longer-term partnerships, and offer potential integration with other ReFi and public goods funders operating on similar maturity timelines.

Together, these four areas of iteration form the basis of a living, learning grant program. Each round is both an impact engine and a protocol for testing the future of public goods funding. Through thoughtful experimentation and open documentation, TEC is helping define the next generation of crypto-native grantmaking that is accountable, strategic, and grounded in the complex realities of engineering systems that matter.

Grant Program Outline for H2

In the second half of 2025, the Token Engineering Commons will continue evolving its grant program through targeted iterations in two key dimensions: a new funding focus area and the introduction of a new funding stage category. These shifts represent a strategic refocusing of our program toward impact, reputation-building, and sustainable pipeline development for high-leverage Token Engineering applications.

Focus Area: Real-World Impact (RWI)

Until now, our grant rounds have centered around a broad definition of Token Engineering public goods and more recently, ecosystem-specific themes like TE on Optimism. While these rounds have surfaced valuable contributions, they’ve lacked thematic cohesion and ecosystem-building capacities. The broadness of “Token Engineering” as a category has diluted synergy across projects, limited collaboration potential, and made it difficult to build a coherent public narrative around our work.

For H2, we are narrowing our focus to fund Real-World Impact (RWI) projects. These are initiatives that apply token engineering methods to solve concrete societal and environmental challenges. This shift not only aligns with the direction of our current initiatives but helps differentiate TEC as a mission-aligned grantmaker capable of moving beyond crypto funding cycles.

Key Characteristics of RWI Projects:
  1. Clear Societal or Environmental Benefit

Projects should directly address real-world challenges (e.g., climate adaptation, equitable resource distribution, commons-based urban infrastructure).

  1. Measurable Outcomes

Applicants must define quantifiable success metrics and propose a data-driven impact strategy.

  1. Stakeholder Engagement

Involvement of relevant non-crypto actors (NGOs, public agencies, affected communities) is highly encouraged.

  1. Scalability and Replicability

Solutions should be designed to scale or adapt across contexts, with clear documentation for others to build upon.

  1. Sustainability

Projects should address long-term viability whether economically, socially, or environmentally.

Qualifying Criteria for RWI Projects:

  • Problem-Oriented: A well defined real-world challenge and justification for why token engineering is an appropriate or novel solution for this problem.

  • Impact-Driven: A clear intent to create positive externalities and not just technical or financial innovation for its own sake.

  • Evidence-Based: Transparent methodologies for assessing impact, with clear plans for collecting and sharing data.

  • Ethical by Design: Awareness of legal, social, and ethical considerations (e.g., data privacy, fairness, inclusivity).

  • Collaborative: Preference for cross-sector partnerships and open knowledge-sharing approaches.

Funding Stage: 0 to 1 (Ideation & Early Development)

Alongside the new focus area, we are also introducing a new category of iteration: Funding Stage. In H2, we will prioritize projects that are in the 0 to 1 phase, meaning pre-launch or early-stage efforts that are developing foundational concepts, prototypes, or infrastructure. This allows us to occupy a valuable niche in the grantmaking landscape: the earliest ideation stage, where traditional grants often hesitate to engage and where we can conservatively create impact with the least amount of funding.

These early-stage projects require smaller amounts of capital, but more guidance, scaffolding, and trust. By supporting projects from their first steps, TEC positions itself as a steward of innovation by nurturing high-potential ideas before they become polished, fundable ventures in larger ecosystems like Gitcoin or Optimism RPGF.

Round Structure

TQF Discovery Round (10K Matching Pool)

This round serves as the entry point for RWI project ideation. Using our established TQF mechanism, we will facilitate a grant round through Allo Protocol and reward projects in their early conceptual or prototyping phases. The primary goal is to uncover, elevate, and nurture ideas that show strong alignment with the RWI criteria, but which may not yet be developed enough for traditional funding.

  • Who should apply: Individuals or teams with promising ideas for applying TE to real-world problems, which may include whitepapers, simulations, frameworks, or MVPs-in-progress.

  • Milestone Planning: Each accepted grantee will work with TEC to define a clear set of 2–4 milestones, which will serve as the basis for potential retroactive funding.

  • Evaluation Criteria: Projects will be evaluated on originality, clarity, alignment with RWI, feasibility of impact, and potential for further development.

The purpose of this Discovery Round is to cast a wide net, surface emerging ideas, and provide a low-friction onramp for new contributors to enter the TEC.

Retro Round 1 (XK Matching Pool)

Following the Discovery Round, grantees who successfully complete their defined milestones will become eligible for Retroactive Funding. This round will use a community-involved process to determine funding amounts based on actual progress, delivery, and alignment with stated RWI goals.

  • Milestone Verification: Grantees must submit milestone evidence, reviewed by TEC coordination team and trusted reviewers.

  • Eligibility Filtering: If the number of qualifying projects exceeds capacity, $TEC token holders will participate in a weighted voting process to determine top recipients.

  • Outcome-Oriented: This round will reward execution, not just intent, by encouraging accountability, follow-through, and thoughtful development.

Retro Round 2+ (XK Matching Pool – Optional)

From here, the program can evolve in one of two strategic directions:

  1. Repeat the Discovery + Retro cycle

Continue sourcing new ideas and helping them reach early development. This expands the breadth of our RWI ecosystem and strengthens TEC’s role as an innovation catalyst.

  1. Steward selected projects through continued Retro Rounds

For promising grantees who demonstrate momentum and alignment, we may offer follow-on Retro Rounds with increasing funding tranches tied to more advanced milestones. This creates a progressive development pathway within TEC, from concept to pilot, to adoption.

This modular structure allows us to experiment, adapt, and eventually converge toward a repeatable model for incubating early-stage public goods with real-world intent.

Why H2 Matters

This upcoming cycle represents a critical inflection point in the evolution of the TEC Grant Program. By narrowing our focus, aligning with a tangible definition of impact, and supporting projects at their earliest and most vulnerable stage, we can:

  • Build a stronger reputation as an effective grantmaker with a clear mission.

  • Develop a more synergistic cohort of grantees, fostering cross-pollination and peer support.

  • Set the stage for a sustainable and differentiated funding program that complements, rather than competes with, other players in the public goods funding ecosystem.

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