Flare’s earliest investors including Hong Kong and US-based Kenetic, US-based Aves Lair, and others, have doubled down on their investment in Flare, the leading Blockchain for Data, by extending token vesting, limiting token sales, and committing significant new capital to investing across the Flare ecosystem.

Today we announce an agreement with a group of Flare’s early backers, which will reduce excess FLR liquidity, increase capital inflows to Flare DeFi protocols, and generate new investment in Flare ecosystem projects. The backers are voluntarily extending their token vesting period from 2024 through to Q1 2026 and they have agreed to limit their token sales to a maximum of 0.5% of the 30-day daily average volume.

To support sustained ecosystem growth and provide additional incentives for builders thinking of developing on the network, the backers have also committed to reinvest at least 50% of the proceeds of all token sales over the next two years back into Flare ecosystem projects.  At the current market valuation, the potential reinvestment into the ecosystem comes to $35M.

Specifically, Flare’s early investor cohort have signed the following binding agreement:

• Extended Token Vesting:  Backers will receive the same amount of FLR as previously. That is 2,107,867,284.31 FLR, with 813,870,745.01 FLR distributed in February 2024. Early investors voluntarily extended distribution from 2024 to Q1 2026, easing market pressure and encouraging long-term network participation and alignment.
• FLR Selling Limit: Early investors committed to binding sales restrictions of FLR sales to no more than 0.5% daily volume (based on historical 30-day volume), providing clarity and reducing market volatility.
• FLR Ecosystem Reinvestment: 50% of all investors’ proceeds from FLR sold through January 2026 will be reinvested in the Flare ecosystem across applications, DeFi,TVL and liquidity-provision, bolstering the most critical value accrual mechanisms.
• Accountability:  The investor group agreed to full programmatic monitoring and accountability for binding adherence to the mission and commitments.

Early investors will receive their originally agreed total of 2% of Flare token supply, however these new terms represent a 68% reduction in upfront distribution, as well as a material lengthening of vesting, and demonstrate to the community of builders and token holders how founders can align with investors to responsibly support a game-changing vision for the Flare network.

The reinvestment of 50% of the proceeds of any token sales will support a wide variety of Flare ecosystem projects including:

• Lending protocols
• Perpetuals decentralized exchanges
• Decentralized exchanges
• Automated market maker protocols
• Synthetic assets
• Cross-chain bridges
• Minting native stablecoins

This reinvestment and investor support initiative is in addition to the October, 2023 announcement, where a separate group of backers agreed for approximately 2.1B FLR of an original 3.2B FLR allocation to be burned. Of this approximately 400M FLR has been burned to date, with another 66M to be burned every month until January 2026. The total amount of FLR to be received by all Flare backers across all rounds is now 3,100,811,195, representing little more than 3% of the total initial FLR supply. These changes have been applied to the updated tokenomics page on our website.

Source: Flare Network