One possibility to raise funds for development is to do a secondary offering on ownership tokens once they are distributed. Obviously existing owners will need to approve (and will be diluted unless they buy more tokens).
Another possibility is in-game taxes. Though of course, blood-from-a-stone applies there and also high in-game taxes will probably depress (if that is possible) and retard the growth the in-game economy.
I don't know what other resources already exist within the game/town/admin structure.
Let's look at in from the perspective of a new player/investor. The project has a bad history. There isn't currently even a game. Why do I want to play/invest?
That is quite a good perspective. There better be a credible plan to increase the value of the game. Something that will convince investors to put in new money is a good test that the plan is credible and not just a circle jerk.
Alternately, dilute M and run an ICO with the new supply. The long history of the game and existing player base can be considered as adding value through bootstrapping, and the ICO proceeds used to further develop the game engine, hire writers for storyline, etc. and launch marketing.