Kaspa

PHANTOM

Industrial

Token

<a style="text-decoration:none" href="https://bsc.news/post/kaspa-blockchain-kas-token-guide" rel="noopener noreferrer nofollow">Kaspa</a> survived without venture capital because its 2021 mining launch severed the project from the funded startup behind its early research, leaving volunteer developers and community crowdfunding to carry the work instead of a corporate treasury.&nbsp;
In February, founder Yonatan Sompolinsky called the setup "absurd," since Kaspa is funded like a fair-launch coin but expected to innovate like a well-capitalized company. On September 21, 2026, KAS traded near $0.042, per Coingecko.
<h2 id="span-span-strong-how-did-kaspa-s-research-start-with-venture-money-strong-span-span">How Did Kaspa's Research Start With Venture Money?</h2>
Kaspa's technical roots predate its 2021 launch by close to a decade.
<h3 id="span-span-strong-from-academic-papers-to-a-funded-startup-strong-span-span">From Academic Papers To A Funded Startup</h3>
Sompolinsky's research career began with the GHOST protocol, a 2013 paper that later shaped how&nbsp;<a style="text-decoration:none" href="https://bsc.news/post/what-is-ethereum-eth-how-it-works-explained" rel="noopener noreferrer nofollow">Ethereum</a>i resolves competing blocks. He later worked with Aviv Zohar and Shai Wyborski on PHANTOM and GHOSTDAG, protocols for ordering transactions across a blockDAG, short for block Directed Acyclic Graph.&nbsp;
Unlike a normal blockchain, where blocks form a single line, a blockDAG lets multiple blocks be created and confirmed in parallel, then ordered afterward by a set consensus rule. In 2017 or 2018, depending on the source, Sompolinsky and Guy Corem founded DAGLabs to commercialize that research. DAGLabs raised $8 million, mainly from Polychain Capital, with smaller amounts from Accomplice and Genesis Mining.
<h3 id="span-span-strong-the-mining-launch-that-cut-the-cord-strong-span-span">The Mining Launch That Cut The Cord</h3>
Kaspa's mainnet launched through open CPU mining on November 7, 2021, with no premine, no insider allocation, and no pre-sale, according to Kaspa's own account of its history. DAGLabs dissolved shortly after.&nbsp;
Once mining began, the only way to acquire KAS was to mine it or buy it on the open market, so Polychain and the other early backers ended up with no special allocation of the asset itself.
<h2 id="span-span-strong-why-does-kaspa-call-its-own-funding-setup-absurd-strong-span-span">Why Does Kaspa Call Its Own Funding Setup Absurd?</h2>
The fair launch that made Kaspa credible also left it without a budget.
<h3 id="span-span-strong-no-treasury-no-salaries-no-marketing-fund-strong-span-span">No Treasury, No Salaries, No Marketing Fund</h3>
Kaspa's tokenomics rule out the tools most projects use to pay a team: no presale, no ICO, no coins set aside for a foundation, and no protocol-level treasury that collects a share of new issuance. All KAS enters circulation through mining rewards. That design is close to&nbsp;<a style="text-decoration:none" href="https://bsc.news/post/what-is-bitcoin-how-it-works-mining-digital-gold-guide" rel="noopener noreferrer nofollow">Bitcoin</a>'s, but Bitcoin has never tried to ship frequent protocol upgrades. Kaspa has.
<h3 id="span-span-strong-a-founder-s-account-of-the-strain-strong-span-span">A Founder's Account Of The Strain</h3>
In a February 2026 essay, Sompolinsky described himself as an "antifounder" who expected Kaspa to stay a hobby project for a handful of proof-of-work enthusiasts. Instead, CPU miners found it, hashrate climbed, and the project took on delivery expectations that resemble a funded company's roadmap. He wrote that ongoing development has depended on a Rust-language development fund, the willingness of core developer Michael Sutton to carry an unofficial CTO role, and grants from the Kaspa Ecosystem Foundation covering three core developers. He warned that leaning on a small number of volunteers is not sustainable indefinitely.
<h2 id="span-span-strong-how-does-kaspa-fund-development-without-a-company-strong-span-span">How Does Kaspa Fund Development Without A Company?</h2>
Two structures have grown up around the core protocol to fill the gap.
<h3 id="span-span-strong-direct-crowdfunding-and-a-multisig-treasury-strong-span-span">Direct Crowdfunding And A Multisig Treasury</h3>
Contributors fund specific initiatives through voluntary crowdfunding campaigns. One raised about 70.23 million KAS, then 0.24% of maximum supply, for research that became the DAGKnight consensus protocol, published as a formal paper by Sompolinsky and Sutton in October 2022.&nbsp;
A separate campaign raised 750,000 KAS to fund a community marketing effort. Ongoing donations sit in a public development fund controlled by four community-elected treasurers through a 2-of-4 multisignature wallet, meaning a withdrawal needs sign-off from at least two of the four before funds move.
<h3 id="span-span-strong-independent-foundations-with-outside-funding-of-their-own-strong-span-span">Independent Foundations, With Outside Funding Of Their Own</h3>
Two nonprofit organizations have since formed alongside the core protocol: the Kaspa Ecosystem Foundation (KEF), which funds grants, hackathons, and developer support, and the Kaspa Industrial Initiative (KII), a Dutch foundation focused on enterprise standards. Neither controls the KAS token or the protocol's code.&nbsp;
KEF's first phase of funding, according to its 2024 announcement, came from ICERIVER Ventures, a mining-hardware company, not from token holders' crowdfunding. Worth noting, Kaspa's base layer has no company backing, but the ecosystem groups built around it do accept industry money, just not equity-style venture investment tied to the token.
<h2 id="span-span-strong-what-has-this-structure-actually-delivered-strong-span-span">What Has This Structure Actually Delivered?</h2>
Despite the funding gap, Kaspa's technical roadmap kept moving.
<h3 id="span-span-strong-the-crescendo-hard-fork-strong-span-span">The Crescendo Hard Fork</h3>
Kaspa activated the Crescendo hard fork on May 5, 2025, raising its block rate from about 1 block per second to 10 blocks per second, with 100-millisecond block times. The upgrade depended on Rusty Kaspa, a Rust-language rewrite of the node software that improved processing speed, and KIP-13, a rule that caps block size so nodes are not overwhelmed by the faster rate. Sompolinsky's February essay noted Crescendo hit its original deadline without delay.
<h3 id="span-span-strong-native-smart-contracts-and-a-recent-security-test-strong-span-span">Native Smart Contracts And A Recent Security Test</h3>
Kaspa's base layer gained native smart contract capability through the Toccata hard fork, which activated on June 30, 2026, adding covenants, meaning programmable spending conditions, and zero-knowledge proof verification. That built on an earlier, more limited step: KRC-20, a token standard launched through Kasplex, a layer-2 indexer, in beta in June 2024 and on mainnet that September.&nbsp;
On September 20, an attacker exploited a signature-verification bypass in the Kasplex KRC-20 indexer, a layer-2 component, draining 94% to 99.6% of the KAS side of two liquidity pools. Kaspa's base layer processed every transaction correctly throughout; the flaw sat in the indexer software, not in the blockDAG consensus or the newer Toccata smart contract layer. Igra, the affected layer-2 project, suspended related withdrawals and bridging in response.
<h2 id="span-span-strong-conclusion-strong-span-span">Conclusion</h2>
Kaspa launched with no premine, no team allocation, and no protocol treasury, leaving volunteer developers and crowdfunded donations, managed by elected treasurers, to carry the work. The founder has openly called that setup unsustainable in its current form. It has nonetheless delivered a tenfold block-rate increase through Crescendo and native smart contracts through the Toccata hard fork, though the September indexer exploit showed the layer-2 tools built on top of that base carry risks the core protocol does not.
<h2 id="span-span-strong-resources-strong-span-span">Resources</h2>
<ol>
 <li><a style="text-decoration:none" href="https://messari.io/project/kaspa/profile" rel="noopener noreferrer nofollow">Report by Messari</a>: What is Kaspa? (DAGLabs funding history)</li>
 <li><a style="text-decoration:none" href="https://www.forbes.com/sites/tomerniv/2025/05/29/kaspa-the-israeli-answer-to-scaling-bitcoin/" rel="noopener noreferrer nofollow">Report by Forbes</a>: Kaspa: The Israeli Answer To Scaling Bitcoin</li>
 <li><a style="text-decoration:none" href="https://coinstats.app/ai/a/fundamental-analysis-kaspa" rel="noopener noreferrer nofollow">Analysis by CoinStats</a>: Kaspa (KAS) - Fundamental Analysis September 2026</li>
 <li><a style="text-decoration:none" href="https://hashdag.medium.com/in-which-it-was-never-my-choice-to-hold-the-fire-we-found-937314149402" rel="noopener noreferrer nofollow">Essay by Yonatan Sompolinsky (Medium)</a>: In which it was never my choice to hold the fire we found (February 16, 2026)</li>
 <li><a style="text-decoration:none" href="https://captainaltcoin.com/kaspa-founder-admits-kas-launch-was-messy-says-project-is-absurd-by-design/" rel="noopener noreferrer nofollow">Report by CaptainAltcoin</a>: Kaspa Founder Admits KAS Launch Was Messy, Says Project Is "Absurd" By Design</li>
 <li><a style="text-decoration:none" href="https://kaspa.org/publications/" rel="noopener noreferrer nofollow">Publications Page by Kaspa</a>: Publications (DAGKNIGHT and PHANTOM GHOSTDAG papers)</li>
 <li><a style="text-decoration:none" href="https://bitcointalk.org/index.php?topic=5490039.0" rel="noopener noreferrer nofollow">Announcement by Kaspa Ecosystem Foundation (BitcoinTalk)</a>: [ANN]KASPA(Kas) Introduce KEF: Kaspa Ecosystem Foundation</li>
 <li><a style="text-decoration:none" href="https://kaspa-kii.org/foundation/" rel="noopener noreferrer nofollow">Website by Kaspa Industrial Initiative</a>: The Foundation · Stichting Kii · Kaspa Industrial Initiative</li>
 <li><a style="text-decoration:none" href="https://github.com/kaspanet/rusty-kaspa/blob/master/docs/crescendo-guide.md" rel="noopener noreferrer nofollow">Documentation by GitHub (kaspanet/rusty-kaspa)</a>: Kaspa Crescendo Hardfork Node Setup Guide</li>
 <li><a style="text-decoration:none" href="https://news.bitcoin.com/security/kasplex-krc-20-indexer-signature-bypass-drains-two-token-pools" rel="noopener noreferrer nofollow">Report by Bitcoin.com News</a>: Kasplex KRC-20 Indexer Signature Bypass Drains Two Token Pools (September 21)</li>
</ol>

How Did Kaspa Grow Without a Traditional VC Token Sale?

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