FungyProof raises $1 million pre-seed to bring transparency

FungyProof creator and its parent studio, CR3 Labs has received pre-seed funding worth US $1 million to advance the development of its NFT quality assessment platform. The investors in the pre-seed funding round included Cadenza Ventures, Hypersphere Ventures, ZMT Capital, Red Beard Ventures, HanDAO, Branson Bollinger and Daniel Hwang, FungyProof editor Mike Roth said in a blog post.

CR3 plans to use the funds to further expand its product offering with a crowd-sourced token review system, support for additional blockchains and the release of an API, he said, adding the company was also looking to hire new talents to help it combat scams, counterfeits and poorly built NFT examples.

“We plan to use the funds to further simplify everyone’s search for high-quality NFT and hire people passionate about the future of Web3”, FungyProof tweeted. 

The NFT ecosystem is rife with scams, knock-offs and poorly constructed NFT, making it a challenging landscape to navigate and a big factor of resistance. The blog quoted NFT marketplace OpenSea to highlight that over 80% of the items created with the NFT creation tool were plagiarized works, fake collections and spam. 

In addition to scams and counterfeits, flaws in smart contract code and improper image storage may make NFT susceptible to breaking altogether, Roth said. In this context, he referred to revelations from FungyProof which said 15% of the NFT graded between November 17-24, 2021 were broken and 48% of the NFT graded used regular HTTP-based metadata. Moreover, NFT images of 14.95% of 2629 tokens graded across 529 collections were unreachable.

Hence, he said, filtering through the noise to identify high quality NFT is complicated and require significant time and technical knowhow. FungyProof, he said, aims to remove the complexity with an intuitive at-a-glance grade that makes it quick and easy for anyone to evaluate the quality of an NFT. 

FungyProof’s grade combines crowd-sourced reviews with technical data analysis to assess the credibility of a project’s team and community, as well as token attributes like permanence, tokenomics, energy efficiency and market integrity. Its unique algorithm covers over 30 datapoints related to code security, decentralization and energy. Since NFT are inherently social, FungyProof also factors in reviews and community insights to cover the metrics that cannot be automated. 

The team behind CR3 Labs is a brother trio who have been building Web3 products together since the inception of Ethereum. With FungyProof, they plan to apply their industry knowledge to help others in the NFT ecosystem, Roth said in the blog.

The team plans to merge the best of traditional company building practices with the current paradigm shift of decentralized governance, community and technology. “We recognize the challenges and opportunities of this space and understand the level of pragmatism required to build products with integrity and longevity”, he said.

FungyProof is joining forces with others in the industry to accomplish its goals, including NFT Storage, Ceramic Network, KlimaDAO, DeFi Safety, Bicowg and more. Together, they plan to focus on encouraging better NFT construction, renovating existing NFT and reducing the ecological impact of NFT.