The rapidly growing TON blockchain, originally started by messaging app Telegram, is getting its own venture capital fund with ecosystem leaders spinning out an independent, for-profit entity from the network's development foundation.

TON Ventures announced its formation on Wednesday, led by Ian Wittkopp, the former director of TON Accelerator, and Inal Kardan, former gaming lead at TON Foundation.

The organization has already raised $40 million and plans to invest in early stage consumer applications in the TON ecosystem with "mass appeal," the press release said. The investors in the fund are "mainly [composed] of individual, private investors, who want to support the long-term growth of the TON ecosystem," the founders told CoinDesk in an email.

The TON ecosystem has seen a rapid rise in popularity recently, with web3 games such as Hamster Kombat and Notcoin attracting many millions of users. These apps are built on top of The Open Network, or TON, a decentralized layer-1 blockchain originally developed by Telegram, but continued as an independent operation due to regulatory concerns after Telegram settled a lawsuit by the U.S. Securities and Exchange Commission (SEC) in 2020.

Digital asset investment firm Pantera Capital said earlier this year that it made its largest investment in its history in TON, and was reportedly raising funds for a second investment round. Crypto giant Tether introduced its USDT stablecoin to TON in April to boost peer-to-peer payments among Telegram users.

Read more: Hamster Kombat Says It Skipped VC Fund Offers, Bashes 'Exit Liquidity' Behavior

The network's native token, toncoin ( TON ) also exploded in price, gaining 339% over the past year, catapulting into the top 10 largest cryptocurrencies with its $16 billion market capitalization.

"TON and Telegram have created a paradigm shift for web3," Ian W., managing partner of TON Ventures, said in a statement. "With our deep experience in the ecosystem, we believe the highest leverage point is in capital allocation for TON."