The upside of quadratic funding for the Zcash ecosystem

https://electriccoin.co/blog/the-upside-of-quadratic-funding-for-the-zcash-ecosystem/

Kevin Owocki is CEO of the Gitcoin project whose mission is to “grow open source” and provide economic opportunities for developers. Gitcoin has doled out ~$4.6 million in funding for development projects.


Hi, everyone. While I’m primarily known in the Ethereum community, I have been following Zcash quietly for years. In 2016 I mined some ZCash and have been following the project since then, because I am a strong believer in the individual right to privacy against surveillance. Zcash is producing bleeding-edge innovation here.

This is why I’m excited to announce our first campaign for Zcash, to support a pilot of our quadratic funding program, Gitcoin Grants, with native ZEC support. More details and background are below, but here’s the latest on this new campaign:

So far we’ve raised 83.10503278 ZEC (or about $4,394.10). If we can raise ~$2,000 more, $10k in matching funds gets triggered and the project will be funded!

If you’d like to see this happen, you should consider donating BY JUNE 15.

  • To donate ETH/DAI: 0x5006DAa32c45d42dF0Ba4bD28e70A06f00304683
  • To donate ZEC: t1ZDfyfwNkyhYzQiRF7iE3wiob1vMp2VR1D  or zs17lcwdj7qlqs9wt04akhs4ytm7k8r65pns6jghh5cdp09qeem5wclvhxpy08ylrwq9ggw50rtkzl
    (Please make sure to include a refund address in the metadata so we’ll know where to return the funds if the project doesn’t reach the mandatory threshold.)

Gitcoin background

Gitcoin’s mission is to grow open source and help devs find new economic opportunities.

One of our products, Gitcoin Grants is being used to fund development in the Ethereum space in a way that’s decentralized + democratic + community-driven. In this program, we raise a matching pool (the last one in ETH was $250k). We then distribute the matching funds along with the community.

But here’s the rub: The breadth of contributors matters more than the amount funded. This is super powerful because a $1 contribution can yield up to $150 in matching funds (if the grant is popular with a lot of people).

Here’s what the UI of this system looks like:

Most crowdfunding campaigns don’t work because of the “free rider problem,” which basically boils down to: “Why should I contribute?“ Quadratic funding solves for this because the game theory of “donate $1, get up to $150 in matching” is what helps users get across this psychological barrier.

The Zcash community has seen this in action, and some believe the model could be a boon for funding development, charitable causes and programs, and more.  If you want to see native ZEC support, consider donating to the crowdfunding campaign.

Still on the fence? Read on to hear about Gitcoin Grant’s trajectory so far on Ethereum.

History of Gitcoin Grants on Ethereum, by the numbers

Gitcoin Grants Round 1, Q1 2019; 200 contributions and $38k raised

The social graph (nodes are users who contributed, edges are transactions):

Gitcoin Grants Round 2, Q2 2019; 2,400 contributions and $56k raised

The social graph (nodes are users who contributed, edges are transactions):

Gitcoin Grants Round 3, Q3 2019; 2,000 contributions and $270k raised

Round 3 we built a UI that estimated how many matching funds your donation would get.

See also: Vitalik Buterin’s review of Round 4

Social graph:

Gitcoin Grants Round 4, Q1 2020; 5,000 contributions and $344k raised

Round 4 included a Media Matching Fund (and plenty of controversy).

See also: Vitalik Buterin’s review of Round 4

Social graph:

Gitcoin Grants Round 5, Q2 2020; 8000 contributions and $475k raised

Round 5 included a Public Health Matching Fund, negative voting, flagging, round-over-round subscriptions, and of course, more controversy.

Vitalik’s Review Forthcoming

Benefits of the program

Our work in administering grant rounds has been an important part of scaling the Ethereum ecosystem because:

  1. It’s proven. We’ve given away $2 million in Gitcoin Grants already.
  2. Every round creates a signal about what projects the community cares about.
  3. It is more decentralized than running a centralized grants program.
  4. It is more scalable than running a centralized grants program.
  5. It serves as a marketing schelling point for people to make noise about — and support — each other’s work.
  6. It pushes power to the edges, because it, as Glen Weyl puts it, “is the mathematically optimal way to fund public goods that a broad swath of the public cares about.”

You can read more about our work funding the Ethereum space below

P.S. Fun fact about the history of QF: Quadratic funding used to be called “Capital-Constrained Liberal Radicalism,” and Zooko was the one who suggested to Vitalik and Glen Weyl that we call it “quadratic funding” instead.

More about me

If you’re in Boulder, Colorado, you may recognize me as the organizer of the Boulder Blockchain meetup. I’ve been in the space for a bit, launching adblock to bitcoin 1 and pytrader 1 back in 2015. I’ve also done some mining. I built a rig, which I used to mine on the ETH mainnet in 2017, and I actually ran it on the ZEC mainnet on launch day (but didn’t actually successfully mine a block – wahh!).

In 2017, I started work on Gitcoin 1, a double-sided marketplace that connects knowledge workers to people who want to hire them.

Find me online here:

More about Gitcoin

Gitcoin’s mission is to grow open source and help devs find new economic opportunities.

There are many ways to do this, and gitcoin offers a few different products to enable this:

  • Virtual hackathons: Online & worldwide. Sponsors post prizes, and people compete to earn them by building stuff to the specifications.
  • Grants: A better way to fund innovation in your ecosystem. Grantees can create a fundraising page for “the great work they’re already doing” in the space, then raise $$$ for that work.
  • Ethical ads via CodeFund: An advertising network that respects your privacy. Codefund allows you to monetize your audience without selling them out.

For more info on Gitcoin, checkout https://gitcoin.co/townsquare![round2|674×398]

Help us help the Zcash ecosystem grow!

We are close to meeting the $15k goal for this campaign, and remember, the power of this platform is that the breadth of contributors matters more than the amount funded. Even small contributions can have huge impacts.

If you’d like to see this happen, you should consider donating BY JUNE 15.

  • To donate ETH/DAI: 0x5006DAa32c45d42dF0Ba4bD28e70A06f00304683
  • To donate ZEC: t1ZDfyfwNkyhYzQiRF7iE3wiob1vMp2VR1D  or zs17lcwdj7qlqs9wt04akhs4ytm7k8r65pns6jghh5cdp09qeem5wclvhxpy08ylrwq9ggw50rtkzl
    (Please make sure to include a refund address in the metadata so we’ll know where to return the funds if the project doesn’t reach the mandatory threshold.)

 

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