Shelling Point by Gitcoin Defines the New Playbook for Web3 Funding

Web3 funding is at a turning point. What began as an experiment in decentralised, community-driven capital allocation has grown into a complex ecosystem facing new challenges of how to scale funding effectively, measure impact beyond raw metrics, and ensure capital reaches the projects that need it most. From grants and quadratic funding to retroactive public goods funding and AI-driven capital allocation, the conversation is shifting toward more adaptive, accountable models.

At this year’s Schelling Point conference organized by Gitcoin, these issues took center stage. The event served as a forum for exploring emerging funding mechanisms, evaluating the role of governance in capital allocation, and debating the evolution of grant funding beyond its traditional structures. 

A Gathering of Brilliant Minds

Schelling Point has solidified its reputation as a destination where the newest ideas and best practices in grants funding and capital allocation are discussed and explored. This year, it was supported by Beincrypto as a media partner, one of the largest cryptocurrency news platforms worldwide. It’s also where major Web3 brands chose to launch their products. Holonym, Divvi, and Butter unveiled tools and mechanisms that promise to reshape capital allocation in the space.

The New Playbook for Web3 Funding

Gitcoin has become a key enabler of efficient capital allocation, facilitating decentralized, data-driven funding mechanisms that reward impact over mere metrics. At Schelling Point, Gitcoin’s vision for funding and capital allocation was at the forefront, shaping the discussion about how Web3 can evolve from static grant models to dynamic, impact-driven mechanisms.

Schelling Point’s programming revolved around scaling builder growth and exploring the mechanisms that could reshape the future of capital allocation. Speakers from across the Web3 ecosystem emphasized the need for innovation in how funds are allocated.

Vaughn McKenzie-Landell, CEO and Co-Founder of Butter, introduced Conditional Funding Markets (CFMs) and Futarchy as tools for aligning funding with measurable impact. CFMs offer an adaptive and accountable funding model, releasing funds based on continuous performance. However, the reliability of data remains a challenge—ensuring the inputs driving funding decisions are accurate is critical to maintaining fairness and transparency.

Meg Lister, General Manager of Gitcoin, echoed the need to redefine success in Web3 funding. She highlighted the limitations of current grant programs, which often fail to assess the real-world impact of projects. For Lister, success should go beyond outputs and include long-term outcomes such as adoption, sustainability, and public good creation.

Divvi’s Co-Founder and COO Denisse Halm explained why her company chose to launch at Schelling Point. She emphasized the importance of builder feedback in shaping evolving funding programs, contributing to the creation of “The New Playbook for Web3 Funding.”

Funding Models of the Future

The rise of retroactive funding models was a major topic of discussion. Panelists from Divvi, Filecoin, and Celo explored how decentralized mechanisms could scale retro funding models, rewarding impact after the fact. These models, which excel in areas like open-source development, face the challenge of defining “impact” clearly. Moreover, decentralized governance mechanisms are crucial to ensure funding decisions are fair and based on merit.

Prometheus, founder of Powerhouse, proposed an innovative model of “open-source capitalism,” which generates revenue through quadratic funding, stake-based governance, and revenue-sharing. This approach seeks to create sustainable incentives for contributors, reducing reliance on one-time grants and fostering more resilient ecosystems.

Transforming Capital Allocation

The afternoon session of Schelling Point dove into the future of capital allocation through artificial intelligence. In a panel contributed to by Anna Shakola, the discussion centered around how AI can automate grant evaluations, detect fraud, and optimize capital allocation at scale. While AI promises increased efficiency, the panelists emphasized that human oversight is still needed to prioritize projects that deliver real value.

Scaling Impact

Schelling Point’s exploration of Futarchy, CFMs, and AI-driven capital allocation revealed a clear consensus: the future of Web3 funding lies in dynamic, accountable, and data-driven models. These models are designed to scale, ensuring that capital flows to projects that deliver measurable and verifiable impact, not just the loudest voices.

The shift towards performance-based funding mechanisms represents a fundamental change in how capital is allocated in Web3. With on-chain metrics, decentralized governance, and retroactive evaluation models, the community is moving beyond static grants to mechanisms that truly serve the public good.

A Celebration of Co-Creation

As Vaughn McKenzie-Landell of Butter put it, “If there’s one area where Ethereum has always excelled, it’s community.” Schelling Point exemplifies the power of co-creation, where collaboration and knowledge-sharing are at the heart of the event. It’s not just about sitting back and listening—it’s about engaging, questioning, and collaborating. As Anke Liu from Stellar said, “It’s exciting to see Gitcoin launch a conference dedicated to sharing this knowledge collectively.”

Denisse Halm from Divvi echoed this sentiment, noting the value of hearing how ecosystems are taking feedback from builders to evolve their funding programs. Together, all these voices create the vibrant ecosystem that drives Schelling Point, a place where groundbreaking ideas are born, and the future of Web3 funding is shaped.

Schelling Point demonstrated that the future of capital allocation in Web3 is bright. With dynamic, data-driven funding models, AI-powered automation, and innovative governance mechanisms, the Web3 space is poised to scale, making funding more efficient, accountable, and impactful than ever before. As we continue this journey, we can be certain that the ideas and collaborations that emerged at Schelling Point will leave a lasting impact on the Web3 funding landscape.