Project Funds were introduced at block 88406 as a method to compensate those who help to make the project better in the following categories.
Project coding / protocol
Other impactful contributions to the project not mentioned
The way that project funds works is, 10% of each minted block reward is forwarded to the special Project funds address(NpryectdevepmentfundsGE). This special address contains no keys and is only accessed by governance directive. This means a majority vote must be held to release funds for each project contribution.