DOT And KSM Have Grown After Attracting the Funding From Master Ventures
Prices for Polkadot (DOT) and Kusama (KSM) rallied in tandem on June 3 after venture capitalist Master Ventures announced the creation of a $ 30 million Polkadot ecosystem fund called Master Ventures Polkadot VC Fund.
In a press release released on June 2, it says the fund will “support and fund Parachain applications” of tier 1 blockchain projects that want to win a Parachain slot on the Polkadot relay chain. Master Ventures also noted that the allocated funds will help young projects launch on the Polkadot and Kusama ecosystems.
Traders took the announcement as a signal to raise their bets on the DOT and KSM pairs. This pushed the DOT up 27.91% to $ 29.21 from its opening on Wednesday. And KSM / USD rose 39.35% to $ 511.91 over the same period.
According to Master Venture, the $ 30 million investment in the Polkadot ecosystem will lead to a faster auction of “Parachain slots”.
Developers trading Polkadot and Kusama on Parachain slots will have to use the projects’ own assets, DOT and KSM, respectively. The Master Ventures Foundation intends to support and fund these developers and their first-tier projects.
This means that the venture capital firm will need to acquire DOT and KSM tokens in order to support bids for the Parachain auction. In turn, Polkadot and Kusama will lock the tokens until the developers want to launch their project on their parachains – from six months to two years.
If the Polkadot ecosystem succeeds, it will lead to an ever-growing number of DOT and KSM tokens locked for the duration of the parachain slot. Which, in turn, will lead to depletion of their total supply in circulation.