Instead, I will give some perspective on my journey and what I will work on in the days and months ahead. What started as my bear market hobby has turned into something I didn’t expect, with new opportunities to focus on the places I find most interesting.

This is my story.

I’m a guitar player, playing metal in my early teens and branching into other styles, including blues, grunge, and jazz. I can’t read music and am entirely self-taught through hours of practice and perseverance. Music has taught me two valuable lessons:

• The ability to improvise.

• Even when you mess up, you must keep playing and never miss a beat.

I applied these lessons to my life, which have been invaluable in my work in crypto. They are the reason I am here today, writing this piece.

Where did this journey start for me?

In 2017, while I read Sapiens, I became fascinated by the concept of shared myths and that our oldest shared myth is money. Around the same time, I started to discover Bitcoin.

I don't know where or how I first found Bitcoin. Once I understood its potential (yes, I admit I am in it for the tech), I dedicated countless hours to reading, learning, and wrapping my head around cryptocurrencies.

I read everything I could find by Nick Szabo, Jameson Lopp, Andreas Antonopoulos, Vitalik Buterin, and many others. I also started to find my way into the strange world of CT, where I discovered vibrant (great adjective, I know) discussions on economics, politics, and the social implications of this technology.

I had found my place and was excited about what the future held in store.

In January 2018, I learned about gravity.

I woke up one day to the carnage of the market crashing; I was not ready for it. I bought into the hype and didn’t consider risk. I saw my portfolio fall through the floor. I stopped checking in on CT and my portfolio and lost hope.

I became disillusioned and found myself with a lot more time on my hands. I decided I wanted to use this time to focus on my music and to try and give back to my community.

I never had a consistent drummer, so I decided to train one. I enrolled my son, who (at the time) was six years old, in the local music school. One day, while waiting for him to finish practice, I decided to take a random walk across the parking lot to a dilapidated building that turned out to be the community food bank.

The food bank exemplified (not in a good way) the concept of “Broken Windows.” For many reasons, the organization had lost the community's trust and was withering away with each passing day. It had garbage and rotten food piled up everywhere, black mold throughout the facility, and generally exuded a sense of hopelessness and despair.

It was sad, and for some crazy reason, I wanted to do something about it.

“Broken Windows” Personified

I started volunteering regularly and eventually attended a board meeting. During this meeting, I discovered the organization had around $15K in the bank and was a few months from going under. I soon found myself as the Board President of this organization and facing some of the most challenging moments of my life in the winter of 2019.

Those lessons learned from music came into focus, and something incredible happened. Despite it looking like we were NGMI, we improvised and kept playing. Over the last few years, our team has turned that organization into one of the more innovative food banks in the country. With the wind at our backs, we are now moving into an exciting phase of building systems that are starting to change the dynamic of how a community approaches food security.

Our concept food bank looks like a Metropolitan Market. We see people visit this facility every week that don’t realize it’s a food bank.

Despite the success I saw with the food bank, one of my biggest regrets was not staying closer to crypto during the previous bear market. As DeFi Summer 2020 started to light up I promised myself I would find a way to remain connected to the space even when the market inevitably turns “down only” again.

I started to think about ways I could provide value in the space. In late 2021, as the bull market was in full swing, I started by developing Sov’s Compendium. The original idea for the site came from this tweet from Shual. Shual had so many resources listed that I thought it would be helpful to capture them all in a notion site.

Once I did that I figured I would just keep on going and add things as I found them.

Today, the site boasts over 1600 entries and attracts thousands of monthly visitors from the crypto community. While building the Compendium, I've forged numerous relationships within the industry.

In addition to Sov’s Compendium, I created this Substack in 2021 and committed to writing more. The first articles I wrote could have been better, and nothing unique or different about them. I didn’t want to be one more guy posting charts and his strong opinions on what dog coins you should buy.

Through my experience working with the food bank, I received a lot of exposure to grants as a 501c3 non-profit entity. It was through these grants that we funded rapid growth and innovation throughout the pandemic.

I noticed many announcements for grant programs and Ecosystem Funds. I thought, “surely there is a Dove Metrics, but for grants programs,” I looked and was surprised that no one was tracking them (outside of random spreadsheets and lists here and there).

I had collected a list of programs on Sov’s Compendium and realized that with minimal effort, my list was already one of the more comprehensive.  I saw this as an opportunity and started by consolidating the information across multiple sources on a Notion called The Common Good.

This was it.  A place I could play to my strengths and provide value.  Just as music taught me, I improvised and kept on playing.

I started to write research reports and I found common information across these grant programs and compiled them into reports that anyone could read and learn more about how they function.  My goal was to bring greater clarity to the programs and establish standards for information.

I started with a few reports around the ecosystems where I could find the information (something that was much more challenging than I originally anticipated).  Then, Amplice from LobsterDAO said I should dive into Uniswap’s Grant Program; this was some of the best advice I have ever received.

I started working on my report for Uniswap and received support from my LobsterDAO frens, including Nemo, Ivan, Cryptographic, Amplice, and ibis.  These guys helped me with various things, including advice, editing, reviewing, and promoting via the LobsterDAO Research Substack.  I can’t thank them enough for their early support.

Once the Uniswap report was published, things started to get interesting. Over the next few months, many interesting opportunities were presented around my work. These included:

• Ken Ng and Devin Walsh from Uniswap Foundation thanked me for my retrospective and mentioned my work in a retrospective Ken wrote.

• Grendel, from DAO Lead at Polygon Village, engaged with me to create a similar retrospective, Polygon Village Content, and provide services to assess their program and provide recommendations.

• I connected with Shreyas from Llama and worked with members of Llama to collaborate on a research report on Nouns DAO

• I had the opportunity to work with 0xngmi and the team to launch LlamaoGrants and heard from many of you how helpful a resource is for finding opportunities around grants in crypto.

• Aave Grants DAO gave me a grant to produce a retrospective published in The Defiant!

• Multiple projects contacted me to see if I could help with grant matching. One of the more notable I worked with was CryptoStats, where I was able to help obtain grants from Avalanche (for CryptoFlows), Uniswap, and the Ethereum Foundation.

• My work with Questbook. They have produced some amazing things, including Reclaim Protocol, ZeroWallet, and questbook.app, a dApp that enables grant programs to find and fund builders.

• And finally, starting my work with Blockworks, I am currently helping with our strategy around grants and governance.

The journey with Blockworks started with a connection over Twitter with Mike Ippolito (he reached out on my birthday, ironically enough). Mike and I had multiple conversations over the next few months, and after learning more about my background and experience, Mike and Jason decided to bring me onto the team.

My first task was to use the information I had gathered to create a comprehensive site that brings together data across all the active grant programs in crypto today. Sites like The Common Good and LlamaoGrants were well received by the community, but I had a different vision for what I wanted to build.  Blockworks gave me the resources to develop something I am very proud to announce today: Grantfarm

Grantfarm is a grant aggregator that aims to provide the most comprehensive and up-to-date list of grant programs, bounties, and RFPs, in crypto.

The platform will enable applicants, programs, and the broader community to search for and discover funding opportunities based on different criteria, including areas of interest, expertise, and adjacency to work done previously.  In addition to providing a place for these listings, we will use the reach of blockworks.co to feature content on grant programs, including research, reports, and announcements from active programs across the space.

If you build it…

Through this project, we’re looking to provide the knowledge and understanding needed for applicants to find opportunities for funding through grants and grant programs to have a platform to reach more users through blockworks.co (a site that receives millions of views a month).

I’m very excited to launch this platform, but I am honestly much more excited to start working with more users and programs to improve the quality and value provided by the site over time.

By providing a comprehensive, evolving list of grants, we can help give clarity to applicants and greater visibility and awareness to grant programs.

Grantfarm!

In some ways, this article might seem like an announcement of Grantfarm, but to me, it’s a story of how it all came to be. There were many times along the way I could have stopped my work and become discouraged, but, largely thanks to the lessons learned from music, I didn’t, and here I am.

My advice to anyone trying to do the same and building towards a vision is to find something that plays to your strengths, provides unique value, improvise when faced with challenges, and keep playing even when you feel like it’s time to stop.

Until next time ✌️

- Sov

https://questbook.mirror.xyz/

In the bull market, we had yield farming; in the bear market, we now have grant farming.

Why are grants significant?

Grants and grants programs have always had a place in crypto (or Web3, if that’s what you like to call it).  Many of these programs and initiatives started focused on base layer network infrastructure, software development, and developer tooling.

Today, these programs have diversified into many focus areas, including content creation, curation, and community building. Over the past year, these programs have increased and gained significant popularity in the broader ecosystem. So let’s dive into why that is and the trajectory of these programs we see in the days ahead.

First, let’s start with some basics to ensure we’re all on the same page.  A grant is “a sum of money given by a government or other organization for a particular purpose.” This sounds like free money to many, but the key phrase in this definition is “for a particular purpose.”  Because we don’t have governments (yay!) doling out the vast majority of funding as we see with grants in the more traditional sense, we instead have interesting new kinds of organizational models that have evolved or developed to take on the role of grants management (among other things).

So, why do these different kinds of organizations dedicate many of their treasuries to giving away money to builders and projects?

To understand this better, there are two concepts we need to comprehend:

1. The Fat Protocol Thesis

2. The Grants Flywheel

Fat Protocol Thesis

A seminal piece in the catalog of crypto knowledge, Joel Monegro’s Fat Protocols thesis states that unlike the walled gardens of Web2 where most of the value accrual happened at the application layer (Ex. Google, Facebook, Amazon) over the protocol layer (Ex. HTTPS, SMTP) the value accrual in Web3 will happen at the protocol layer over the application layer.

This will happen primarily due to two significant factors:

1. Complete transparency of data

2. The presence of a token to access the protocol that can accrue in value

The defensibility of Web2 projects lies in the data they possess and the tech IP. In Web3, when both the data and the code are open to the public, the only defensibility comes from network effects and the costs of switching to another product.

Network effects directly function the number of valuable products built upon a protocol. These beneficial products must also have a strong community with strong network effects to decrease user switching costs.

Now that it is well understood that protocols need practical applications built on top of them, how can a protocol incentivize valuable projects to be built on top of it? How can a value flywheel be created for an incentive program?

Enter Grants.

The Grants Value Flywheel

When we look at grants, the organization disbursing the grant has the underlying belief that the grantee will build something that will augment its value. Joel John explained the grants flywheel the best in an infographic from his piece “Grants & Web3” (another must-read from the catalog of crypto knowledge).

Source: Grants & Web3 by Joel John

While the image above is self-explanatory, it is clear that the primary goal of a grants program is to maximize the number of individuals and teams building value across the broader ecosystem and using that value to attract the most users. Additionally, the treasuries that support these programs are very limited in what they can do with their funds. Therefore, they must place their bets wisely regarding operational costs and grant distribution, especially in the depths of a bear market like we are currently experiencing.

Another interesting aspect of grants in Web3 is that these programs manage some portion of the treasuries for the respective protocol tokens. This means that the grant programs are tasked with spending money to increase the value of the remaining tokens; this is a never seen dynamic in web2. For example, imagine if Apple had incentivized early app developers with Apple Stocks. In this mental model, if Apple accrues value because of the apps, the developers have unbound upside too.

Now that we have shared with you a bit of our perspective on the way, let’s take a look at the how as we dive deeper into how these programs function today.

Component Parts

To understand how grant programs work, we must first understand the different moving parts. There are currently four pillars we will touch on in this piece to describe how these programs are structured today:

1. Organizational Structure

2. Capital

3. Participants

4. Workflows and Tooling

Organizational Structure

Sov recently wrote a piece titled Organizational Models, describing the different kinds of organizations common across Web3, specifically for grants programs.  These are:

1. Foundations

2. Ecosystem DAOs

3. Protocol DAOs

At a high level, you see a spectrum where on one end, you have more centralized entities (Foundations) that are, at times stepping stones to traditional VC funding, either through their Ecosystem Funds or VC Networks.  These organizations typically have strict regulatory requirements, like KYC/KYB, and oversight due to legal constraints of where they are headquartered and various other factors.

In the middle of this spectrum would sit Ecosystem DAOs.  These are organizations that were created to help bolster support for a specific community or purpose.  These organizations can be formed from a Foundation or Protocol DAO and exist in many respects to help the parent organization move closer to the middle in engaging with the community and broader ecosystem. For example, organizations like Aave Grants DAO were formed to manage and disburse grants. At the same time, others see grants as a primary function but also support other aspects of the community, like Polygon DAO.

On the far end of the spectrum, we have Protocol DAOs.  These organizations espouse the core ethos of decentralization and make every effort to drive engagement and governance from their communities.  Typically you see these organizations having prominent players that are active in governance functions. These stakeholders work to steer conversations and community sentiment towards goals and objectives that they feel would be best to help steward the sustainability and growth of the underlying organization. Prominent examples here would be MakerDAO and Compound.

Capital

Capital across the treasuries of organizations is managed in many different ways with varying levels of transparency in their flows and processes based on the type of organization they are.

On one end of the spectrum, you have more decentralized organizations like Protocol DAOs and some Ecosystem DAOs.  Most of these are all on-chain and can be seen at sites like openorgs.info at a very high level. Others have further taken this commitment to transparency by developing their sites that provide dashboard-like views of how the funds are being used (like Polkadot’s Dotreasury or NounsDAO’s Governance).

Capital for these more decentralized organizations is allocated through open governance processes managed in forums like Discourse or Commonwealth or by dedicated teams that oversee the grants process and are responsible for budgeting, etc.  Typically the entity would state core areas of focus based on the needs of the protocol or ecosystem, and it would be the responsibility of community teams to steward funds and resources for those goals.  One of our favorite Twitter followers is DAO Research Collective, and they recently went into great detail regarding this topic in their piece, Treasury Management, if you want to learn more.

Other organizations on the more centralized end of the spectrum are typically more opaque in their processes. For example, they may have funds distributed across many on-chain wallets or in traditional bank accounts.  Capital is sometimes allocated and managed by grants teams, but you would typically see Business Development or Foundation Leadership playing a heavy role in oversight.

Participants

Participants encompass both internal to the organization and that outside that participates across the grants lifecycle.

Internal participants include all the individuals and teams that work directly for the organization in some capacity.  These roles can be full-time, part-time, on a contract basis, or as an appointment by the community (this usually occurs in protocol DAOs).  Depending on the organization's size and level of focus, they may have dedicated grants teams, typically with roles like grants analysts, managers, and committees with specific focus areas.  Other parts that are sometimes responsible include business development, developer relations, leadership, and protocol development.  These teams may play supporting roles or, in the case of the organization not having a dedicated grants team, be directly responsible for managing the grants lifecycle.

These internal participants work on tasks across the grants lifecycle that include driving awareness review of applications, engaging with applicants, keeping current documentation, approving applications, and ensuring follow-up or follow-through once applications are accepted with things like funds disbursement, progress tracking, and ongoing support of projects and their stated goals and objectives.

External participants include those who have requested funding (applicants), those who have received funding (grantees) along with active community members (typically within the Protocol DAO structure that participates in some form of governance).

If we start by looking at both applicants and grantees, they typically fall into a few broad categories:

• Developers

• Marketers

• Researchers

• Curators

The lion’s share of programs today are looking for qualified developers to help build infrastructure, tooling, and interesting applications on top of their network.  Recently Alchemy released a report detailing Web3 Development that offers some interesting insights into the current state of development across the broader ecosystem, and it’s apparent that even though we currently sit in the depths of a bear market in terms of price action, the amount of development happening is scaling at an incredible rate.

One point to consider is that even though this report shows a fast accelerating growth trajectory, it doesn’t show the scarcity of competent developers, a problem that many different ecosystems and their programs are dealing with.

In addition to developers being the main focal point for many of these programs, we are starting to see them open up to alternative skillsets, including content creation like marketing materials (blogs, newsletters, and social media) along with research that helps with building greater awareness, diving into complex topics that need further review or explanation, and even expanding into new frontiers like Decentralized Science (DeSci) like we have seen recently with Polygon DAO or the Ethereum Foundation.  In addition to these types of content creation, we also see opportunities arise for curators that specialize in gathering and organizing information for wider consumption using tools like Notion or Obsidian.

One of the more significant challenges faced by many programs in the space today is finding qualified applicants that can fulfill the promise of building valuable projects that can help to grow the ecosystem. We joked a bit earlier in this piece about the phenomenon of “grant farming,” but its impacts can be seen in programs that are only disbursing to a tiny double-digit percentage (typically 10-15%) of the applications they receive. This low rate of application approval can be for various reasons, including the applicant’s lack of vision, doubts about its ability to execute, or the applicant doesn’t fit the areas of focus the program is looking at for growing its ecosystem.

Tooling and Workflows

Tooling and workflows refer to the process and supporting infrastructure these organizations use to grow and manage their grants program. While traditional non-profit organizations (what many people think of when they hear the word “grants”) often have a more established process for seeking and receiving funding along with a vast network of products and services, the Web3 space is just starting to develop mature tooling and workflows to address this emerging need.

Across Web3, there is a wide variation of tools and workflows that are being used today by teams, including traditional Web2-based tools like Google Sheets, Notion, Salesforce, and others with more and more Web3 native instruments, like Questbook, that are being developed specifically for the needs of these new kinds of organizations that crypto is enabling. The tooling type can be influenced by several factors, including the type of organization and its approach to building and managing its programs, the focus of its programs, the capabilities of its team, the complexity of its processes, and the specificity of its needs.

Many programs have a simple process for soliciting grant applications, especially for smaller grants (typically sub $30K).  Usually, the steps will include submitting the proposal details on a form, in Github, or directly in the community governance forum. For more extensive proposals, the process can be much more involved with detailed explanations, including a project plan that explains the milestones for the submission.

Once applications have been received, the review process starts for the grantor. Depending on the kind of organization, the review process can involve internal team members that sit on a grants team or committee, typically with Foundations or Ecosystem DAOs. An excellent example of this kind of structure exists with Aave Grants DAO and their Grants Committee. Sov wrote more about their program in his Aave Grants Retrospective. Aave Grants DAO has multiple part-time members involved in the review process, all known and respected community stakeholders.

In the case of Protocol DAOs, the review process typically involves community discussions through governance forums, with community members providing their thoughts and opinions on submissions and using mechanisms like Snapshot to vote on the proposals. The goal is to ensure that there is a proper process to ensure the review process is fair and transparent and that those involved in making the decisions are qualified to make those decisions. The challenge with this model is that it can be cumbersome, not a good fit for more minor proposals seeking grants, and can often preclude smaller grants.

After a grant has been reviewed and approved, the monitoring and evaluation of the project's progress start. The grantor may monitor for grants that involve multiple milestones to ensure the work is progressing and provide feedback or resources where needed or escalate issues depending on their process and bandwidth. For more direct grants that involve a few specific tasks or objectives, the grantor may elect to payout upon completion or half down when work commences and the rest of the payment when the grant has been completed.

One area that many programs researched struggle with is measuring impact. The challenge is that different programs consider different areas of impact, and the tools they use, including custom-built tools, often aren’t built to capture various factors. As a result, many organizations are trying to learn more about impact after the fact. The hope is that new tools can be built to help organizations evaluate and get actionable insights on the effects and usage patterns for projects, developers, and organizations.

Closing

If it’s not apparent already, we believe grant programs and innovative new approaches to funding great ideas will continue to play a significant role in the Web3 ecosystem.

If you are building a Web3 grant program and are interested in how Questbook could help, we would love to hear from you. DM’s are open.

Peace!

- Sid Rao & Sov

https://thedefiant.io/aave-grants-retrospective

Well, hello, anon; great to see you here again for another of my grant program retrospectives! It’s been too long since I wrote one of these, and I hope to get back in the saddle again in pumping out more of this kind of content in the days ahead (famous last words, I’m sure).

This time around, we’ll be looking at Aave, including a brief origin story, the history of their grants, and a deep dive into the current state of their programs.

Without further adieu, LFG!

Origin Story

So what is Aave, and where did the idea for the project initially come from?

At its core, Aave is (according to their docs site):

a decentralized non-custodial liquidity market protocol where users can participate as depositors or borrowers. Depositors provide liquidity to the market to earn a passive income, while borrowers can borrow in an overcollateralized (perpetually) or undercollateralized (one-block liquidity) fashion.

Founded by a Finnish Law Student named Stani Kulechov, Stani came up with the idea for Aave after encountering Ethereum while at university and learning about the potential offered by smart contracts. Stani realized there was an opportunity to provide alternatives to centralized lending, especially as decentralized networks like Ethereum started to mature and take shape.

The project officially launched in January 2017 and was initially called ETHLend. At first, Stani encountered resistance to his idea, with the initial feedback from Reddit forums being there was no need for a service like ETHLend. The fact that Stani received this kind of feedback early on is a testament to how important it is for founders to trust their instincts and not the wisdom of crowds (especially mid-curves on Reddit forums), as many times true potential isn’t always apparent to many early on, that’s the nature of true innovation.

ETHLend underwent an Initial Coin Offering (ICO) in late 2017 (end of November, to be precise) and received ~$17.8 million in funding. While most ICOs were vapor and didn’t stand the test of time, ETHLend had something special and was one of the few projects that made it to the other side of the chasm. I did have fun revisiting the ICO sites that I haven’t looked at since late 2017. That period was Sov’s introduction to crypto and let’s say I wasn’t fortunate enough to find a diamond in the rough like ETHLend.

Following the ICO, ETHLend rebranded to Aave (meaning “ghost” in Finnish) and continued its focus on being the defacto decentralized lending platform. The project has continued to be a success despite the long winter that befell our space in 2018, and in the years since their ICO, Aave has raised over $49 million in private funding rounds to help them grow and sustain.

Over time Aave has continued to innovate on its core offering (such as Flash Loans and the soon-to-be-released $GHO), built a thriving ecosystem of partnerships, and diversified into other areas like Web3 Identity and Social with Lens Protocol.

The Generalist recently wrote an extensive piece with more details of Aave’s history, current state, and roadmap for what is to come. For this piece, I just wanted to give you a bit of the high level on the background of Aave before we jump into the details of their grant programs, so if you’re going to dive into more of the details, please check out their most excellent write up from the thread below.

Now that we have covered Aave’s origin story let’s dive into the history of Aave’s Grant Programs.

Aave Ecosystem Grants

Aave grants started in the same way that Ethereum did: with the founder (in this case, Stani) giving funds to individuals and teams that he felt were growing the protocol and surrounding ecosystem. Information on grantees from those days is not publicly available, but the growth of Aave is probably a testament enough to the success of his early efforts.

Aave decided to formalize the process of grants a bit more when they launched Aave Ecosystem Grants in April 2020. The program was intended to grow support for the protocol by engaging the community to update their governance and focus on developing various applications beyond smart contract development. Aave Ecosystem Grants were run by David Truong, an early member of the Aave Team. David worked to build the structure (seen in the medium posts here and here), reviewed incoming applications and managed the lifecycle of grants from submission to disbursement.

David was kind enough to help me with some background and information for this article. In our discussions on Telegram, he noted:

Grant programs need to make many early bets that may not turn out, but out of a few there will be some good ones. Similar to a VC, but the goal isnt profit maxi, it is network / growth maxi. E.g. Aavegotchi, Push protocol (aka EPNS), DeFi saver, 88mph, GoodGhosting all were awarded grants from the first 2 rounds.

Well done, ser.

The Ecosystem Grants went through two rounds and successfully funded dozens of applications. I created a page on Notion that details the publicly available recipients list if you want to look at them.

Many recognizable projects came through the Ecosystem Grants Program, including DeFi Saver, Rotki, Mero, Jarvis Network, and NFTs with Aavegotchi. The program helped to support many recognizable names in the space as they were just getting started and was eventually sunsetted with the formation of the Aave DAO.

Early Forum Discussions

The first mention of the term “grant” in the Aave Forums was in September 2020; the forum discussion centered on introducing transaction fees to reward $AAVE holders. During this time, the original $LEND (from ETHLend) was being used for governance and dealt with concepts of staking rewards that today are all too familiar across DeFi. In this post, Stani mentions:

One important feature the v2 will have is a Reserve Factor which means that Aave Protocol will be able to collect protocol fees into the Aave Reserve and distribute them accordingly to the Aave tokenholders, builders, grants, liquidity providers and liquidators depending on what the governance wants.

The early forum discussions are a fascinating walk down memory lane with notable personalities like monetsupply, Dydymoon, Marc Zeller, and Stani discussing concepts that would eventually become mainstays across many projects that dominate the space today.

Around this time, many other early DeFi projects (most notably Uniswap) were contemplating similar grant programs as their treasuries came online. Before this moment, projects like Uniswap, Aave, and others, saw funding through ICOs, venture raises, or from academic institutions or early foundations like Ethereum Foundation (The OG: Original Grantor) for ongoing research and development.

These early discussions and the formation of the Aave DAO were a realization for the team that they needed to take steps to decentralize the process of grants better and think through ways to evolve how community-run grant programs could operate. These drivers were the catalyst for one of the first Sub DAOs created to focus on ecosystem growth through community-focused grants.

Enter Aave Grants DAO (AGD).

Aave Grants DAO

Aave Ecosystem Grants Program was transitioned to the now Aave Grants DAO in May 2021 via AIP-17. What initially started as a two-quarter pilot has become one of the more successful and well-structured grant programs in Web3 today. The mission of the Aave Grants DAO states:

To provide grants to projects, ideas, and events that benefit Aave and its ecosystem.

AGD is effectively a sub-DAO of Aave DAO that focuses on empowering a more comprehensive network of community developers. The program has been renewed from its initial pilot twice now (November 2021 and April 2022) and has continued to scale over time and support Aave and create a rising tide of sorts that has helped foster growth and innovation across all of Web3.

Budgets

Regarding budgets and approach to proposals, AGD took their queues from other programs such as Compound and Uniswap. For example, Aave DAO allocated an initial budget of $2 million and a maximum operating budget of $250k. The operating budget was to be used to pay the lead, reviewers, legal counsel, and other administrative costs related to the setup of AGD.

The program has continued to grow over time regarding budget and supporting resources. For example, the renewal of the initial pilot passed in November 2021 and grew the grant budget to $2 million with an operations budget of $2 million per quarter. Another proposal was passed In April of this year to expand the total funding to $5.8M across two quarters (bear markets are for building, anon.)

Oversight

The initial proposal (written by Aleks Larsen and Shreyas Hariharan) lays out a vision for AGD as a community-led program that appreciates the difficulty of decentralizing grant programs.

One of the more difficult parts of developing this kind of structure lies in the alignment of people to oversee the different functions of the program while still allowing for proper community involvement and overall transparency. For example, AGD formed a grants committee of eight members to address this challenge, including one lead and seven reviewers. This initial team of eight included:

1. Lead: Shreyas Hariharan

2. Aleks Larsen

3. Jose Maria Macedo

4. Imran Khan

5. Maggie Love

6. Corbin Page

7. Nick Cannon

8. Calvin Chu

The description for these roles from the initial proposal is as follows:

The job of the lead is to serve as the organizational backbone of the program and ensure that things move smoothly and efficiently. The lead will likely dedicate a significant amount of time to the program.

Reviewers will process applications, ensure that the lead is acting in good faith and is effective in their role, and will operate a 4 of 7 multisig which disburses funds to grantees. The reviewers will also hold the program accountable to its goals and objectives and return any excess funds to the Aave Ecosystem Reserve. Reviewers are likely to dedicate a smaller amount of time to the program.

Both the lead and the reviewers will serve for a period of two quarters. After two quarters, the grants program and the committee member positions will be up for renewal. This will be put up on the governance forum for a discussion and subsequent on-chain vote.

With the subsequent renewals of the program that have happened over time, this team of reviewers has changed its makeup, with some committee members stepping down. The makeup of the grants committee currently consists of the following:

1. Lead: Shreyas Hariharan

2. Corbin Page – Paymagic, ex-ConsenSys

3. Calvin Chu – Impossible Finance

4. Aleks Larsen – Blockchain Capital

5. Francis Gowan – Flipside Crypto

6. Kakashi – Symphony Finance

7. Lawrence Mosley – Omni Analytics

8. David Truong

9. Andrew

10. Ernesto

In addition to the rotation of committee members, new roles to support the program’s growth. These roles and the current individuals that fill them include:

• Designer: Laura Sinisterra

• Operations lead: Neil Shroff

• Community manager: Bill

• **Events Coordinator: **Cree

• Analyst: 0xMigi

The compensation for the current team is public knowledge and well-defined. It has changed slightly in terms of hourly rates for some members since the initial proposal and is reasonable compared to similar roles and rates I have seen across other programs. Currently, this compensation structure consists of the following:

• Lead: $150 an hour with a 30-hour/week cap

• Review committee: $150 an hour with a 10-hour/week cap

• Designer: one-off based on specific design engagements

• Operations lead: $3.5k/month

• Community manager: $6k/month

Shreyas led the initial recruitment of the team, set up the structure of how grants needed to be reviewed, and improved the speed of responses and quality of reviews. The result was a program that functions smoothly and is on track to create the path to long-term contributions to Aave.

Proposals

AGD broke up the kinds of grants they would fund into two categories: Rapid and Community. The details, as outlined in the initial forum post, describe these categories:

• Rapid grants: <$100k

  • Simple process to apply for a grant to AGP

  • Grant decision expected within ten days

• Community grants: $100k-$500k

  • Applicants post a proposal on AAave’sgovernance forum

  • Based on feedback and discussion, the committee can decide to approve these grants

There are allowances for contributors to ask for larger grants over the $500K mark, but these needed to be posted to the Aave governance forum and approved through an on-chain vote of the Aave DAO.

Over time the categories of grants have changed slightly and now consist of four types that are separated based on the size and scope of the grant request. You can find more in-depth details here on their Notion site describing how these are to be submitted, reviewed, and approved.

• Rapid Grants (<$20k, faster process, smaller grants)

• Grants ($20K – $100k, quick process, bigger grants)

• Community Grants (>$100k), just a slightly slower process, substantial grants)

• Grants Above $500k

AGD accepts applications on a rolling basis, with the grants committee determining how funding is, disbursed (e.g., milestones, upfront, etc.) on a case-by-case basis.

Areas of Focus

As budgets and resources to support the program has grown, so have AGD’s focus areas. Like with the Ecosystem Grant Program before it, AGD started with a primary focus on protocol development to now supports a much broader scope that has allocated funds and resources in support of:

• Events, Hackathons, and Sponsorships

• Applications and Integrations

• User Protection and Protocol Security

• Community and User Growth

• Increasing Liquidity

• Protocol Analytics and Development

• Oversight and Transparency

In addition to the stated focus areas, AGD’s Notion site has a page that inspires builders and potential applicants. This page is very detailed and a valuable tool to help guide potential applicants on the work that AGD is especially motivated to fund and support. On this page, AGD currently lists its top priorities as follows:

• Stablecoin Growth: projects and integrations that bring more stablecoin deposits into Aave

• Governance UI: the development of an Aave-owned front-end for governance and voting

• Credit Delegations: allows a depositor to deposit funds in the protocol to earn interest and delegate borrowing power to other users

Metrics

The initial proposal outlined quantitative and qualitative metrics that AGD measures over time.

Their team members produce regular reports on progress towards these objectives and general updates on the program (specifically 0xMigi and Bill). They also provide information on the performance and progress made by granted contributors and projects.

0xMigi recently published an update on Aave’s Governance Forum detailing the performance through September, which you can find here. Migi is a total chad and was kind enough to update those numbers for me through the end of October so that I can share them with all of you here.

In addition to his role as a reviewer, 0xMigi has been working with Omni Analytics to create automated transparency reporting to provide running monthly updates on the forum along with a progress metrics dashboard. The dashboard is still a work in progress, but thanks to 0xMigi, I was able to get a sneak peek that I have below.

Overall, the team does a great job of keeping a detailed list of the grants given and publishing a regular newsletter that keeps curious minds abreast of all the latest happenings with AGD and the more comprehensive Aave Ecosystem.

Aave has built an awesome developer community. Even though the AGD team is somewhat lean, they have had an outsized impact on their contributions to Aave and the broader ecosystem.

How to Apply

Applying is a straightforward process. You can head to this page on their Notion and complete a simple form that requires standard details requested by Web3 grant programs, including a project description, goals, milestones, funding request, and a budget breakdown.

In addition to their standard application process, the team at AGD is also partnering with Questbook to pilot the use of their product for community grants. Questbook has a platform that allows for the management of Web3 grants across their lifecycle and is provided a grant in a recent round from AGD. You can head over to the application on Questbook if you want to check out that route.

Once your form is submitted, the typical turnaround time to hear back is within a week or two, which is relatively fast, considering the volume of applications. The team reviews each application and will want to set up a meeting or interview to understand more about your proposal if they consider moving forward. If your application is declined, you will receive an email that may or may not describe why AGD denied the application.

In addition to the form, AGD has a dedicated Telegram Channel where applicants can pose questions to the team and get feedback regarding submitted applications or general questions regarding the process.

Ecosystem Grant Programs

In addition to the AGD, which serves as the primary Grants DAO for Aave, I wanted to include some details on the Aave Team’s Web3 answer to social media, Lens Protocol, and their grant program.

Lens Protocol

Lens Protocol is a composable and decentralized social graph built on Polygon. Lens isn’t technically part of Aave Grants, BUT it was created by the same development team (and it’s awesome), so I thought I might add it here for the culture.

The protocol is user-owned and open and allows any application to build on top of it. Lens Protocol is Web3 Native and has features and functionality that enable creators to own their content wherever they go.

Lens Protocol is from the same development team that brought us Aave Protocol. Initially teased by Stani at LisCon in late 2021, there was quite a bit of buzz around decentralized alternatives to today’s social media giants for apparent reasons.

An open letter started circulating in January of 2022 describing the project, and Lens Protocol launched shortly after. In the Mirror Post announcing Lens Protocol, the team details a few topics, including why they built it, what it is, and how the various functions work.

Since its launch, the project has been a smashing success, with many different projects building interesting applications on top of it. For example, 0xJuanicito curates a list that you can check out detailing projects, resources, libraries, and tools for Lens.

Lens’ grant program focuses on supporting open-source projects that generate public goods for the community. The program launched parallel to the protocol in February of this year and has since granted multiple recipients (you can read the threads here and here announcing recent grantees).

They have many categories under which they accept grants, and the application process is simple. You can check out their Notion Site to apply or for more details.

Closing

That’s all for now, anon.

I hope this piece was informative and helped provide some perspective on Aave and its associated grant programs. Big thanks to Aave Grants DAO for funding this piece and sponsoring my Crypto Grant Wire series.

If you like my work, follow me on Twitter and check out my blog, Sovereign Signal, if you found this by some other means.

I also curate Sov’s Compendium, a collection of curated information sauces, research, and valuable tools that might help your journey toward sovereignty.

Peace,

Sov

https://questbook.mirror.xyz/

When building a product, the best feedback comes from working directly with your clients and partners to understand what’s important to them. One of the best examples of this we have seen in our journey is our work with the team at Polygon DAO.

We were fortunate enough to have the opportunity to work with the Polygon DAO team on their initial launch, and we continue to work with them on an ongoing basis. Today, we’ll cover a bit of our shared history and how we have taken their feedback over time and improved our platform.

History

I wrote previously about some of Polygon’s History in my retrospective a few months back. In it, I described their origins from Matic and some of the different iterations they have seen over time with their grant programs, including the Matic Developer Support Program (launched in 2019) and #DefiForAll (established in 2021). At the height of the 2021 bull market, many ecosystem funds and grant programs were launched, like #DefiForAll.   Many of these ended up folding due to unrealistic expectations and oversized fund valuations that were not sustainable for the long term.

Polygon knew that Polygon DAO and its grant program needed to be different. It had to be a sustainable program that could support projects over the long term by providing more than just funding but a holistic support framework.

Polygon approached this challenge by considering the best approach to structuring how it could onboard 1000+ new projects onto Polygon (a mission statement they continue to work towards even today). They realized that grants would be a critical part of this story but not the only answer. During these early stages, the vision for what was then known as the Polygon Ecosystem DAO started to take shape.

One of Polygon’s first (and most important) initiatives was to delegate the flow of grants to the newly formed Polygon Ecosystem DAO (later, their name changed to just Polygon DAO). Early on, this was a key area of focus for the DAO Genesis Team in developing a more extensive governance model. The team realized they needed to build a platform that enabled and supported them. Thus, they launched the Polygon Village: A one-stop shop that could help guide builders in all the ways they can engage with and request support from Polygon and its vast ecosystem.

Today, Village is a robust and thriving community where builders can access not only grants but Jobs, Bounties, Welcome Vouchers, and Village Wonders (their accelerator program). In addition, Polygon Village has demonstrated the DAO Team’s thought leadership in going above and beyond a simple grants program to a comprehensive suite of support that can meet projects wherever they are in their journey.

Now that we have given you a bit of the background let’s dive into how we initially engaged with Polygon and how that partnership helped us to develop our Grants Management Platform.

Getting Started

Our team started to engage with Polygon in Q2 of 2021. At the time, Polygon was already one of the more active grant programs in the space, with Developer and Ecosystem Support Programs in full swing. They had a relatively high volume of grant applications. In addition, Polygon asked our team to help meet and interview different community members and grant applicants to garner feedback on their experience. Our goal in this was to see how Polygon could evolve its program to meet the needs of builders better.

We started the engagement by setting up many different individual Telegram groups to interview them and learn about the experiences, good and bad; they had in working with Polygon. We quickly discovered that feedback expectations were not always well aligned, confusing the process and causing misunderstanding of how grants were decided on and distributed. We also learned that, sometimes, just as important as the funding was the desire to work with Polygon to create greater brand awareness through their social media and ecosystem.

This feedback proved invaluable and helped us understand how we could better develop a workflow to optimize their current process and what steps we could take in developing Questbook’s Grant Management Platform better to meet the needs of grantor programs and applicants alike.

Workflow Assessment

In addition to engaging with applicants and community members directly, we looked at the workflows that supported the application process. For example, applicants needed to fill out a form, join the Polygon Discord, write a proposal in a dedicated channel, and wait for DAO Team members to provide feedback. In addition to the front end of the workflow with application intake and review, the team struggled with manual entry and tracking of applicant data which also proved challenging.

These processes took time and effort to manage as volumes increased, and things like success metrics or milestones were not well defined. Ultimately, this workflow didn’t meet their desired outcomes for improving SLAs and grantee satisfaction, and they were looking for options on how to improve but stay true to their goals and ethos.

We saw this as an opportunity to improve their experience by developing an optimized workflow and accompanying platform to support. This feedback helped us tremendously early on in developing our platform and tailoring it to the needs of grant programs across Web3.

Questbook Platform Launch

When Polygon DAO launched and added dedicated team members for managing the grants lifecycle, we went live with our grants management platform. The insights from working closely with Polygon DAO proved invaluable in building a platform that helped tie all parts of the grants management process into one seamlessly integrated tool.

*“Our product is all about making the process of Web3 Grants Management seamless. We tie together all the different parts of the grant lifecycle in one open-source platform.”

- Harsha, Co-Founder of Questbook*

With Questbook, the Polygon DAO team can now create, receive, review, track, and disburse grants all in one place. Without their insights and feedback, we would not have fully appreciated the importance of these kinds of problems and may not have correctly prioritized our time and resources. Instead, we thank them for their partnership in helping us to build a platform that delivers real value.

Some examples of this value are:

• Time spent reviewing and approving applications went from 2-3 months to now, on average, 15 days. Turnaround time is an excellent indicator because it relates to many aspects of the process flow (from intake to disbursement).

• A monthly application window where grants are submitted by the 10th of each month and targeted for disbursal in the last ten days of the month. This change allowed the Polygon DAO team to segment their budget and see what metrics, like applications received and total funds disbursed, would look like month over time.

• The ability to delegate review and approval of applications across different members. Our platform allows them to assign reviewers to proposals so the Grant Management team can monitor the review's progress through the grant lifecycle.

• Development of the evaluation rubric, a feature allowing programs to define custom criteria for evaluating proposals (helpful for grants teams with multiple members).

• A batch payment feature allows for grants to be allocated and disbursed efficiently across multiple applicants without heavy manual entry and one-by-one approval of funds sent to individual addresses.

"If not for Questbook, we would not have come up with this new structure. Community insight docs were the key to setting up the process.”

- Marco Grendel, Polygon DAO Lead

Closing

Thanks to the efficiencies gained from Questbook, Polygon has identified many innovative new projects they wouldn’t have caught otherwise. As a result, the grant process has become smoother and more decentralized for both the protocol and the applicants. However, we still see much potential with all the success we have seen. As Joel John mentions in Grants and Web3:

“The end state for ecosystem grants will be to tackle problems traditional financing cannot fix. These are usually public goods that require time and years of commitment.”

We couldn’t agree more, and that’s why we wake up every day excited to build. We talked to various programs and thought leaders across the Web3 space daily. We would welcome the opportunity to develop partnerships with others as we have with Polygon DAO.

Until next time,

- Sov

-=-

One of the more interesting aspects to crypto (or Web3 if you like to call it that instead) is the concept of organizational models and how decentralized networks have the ability to enable new kinds of coordination and collaboration across individuals and teams (some doxxed, some anon or pseudonymous).

As I have researched various grants and incentives programs since late last year I have started to understand some of these models better and thought it would be interesting to dive in a bit to some of what I have learned as it applies to a few different kinds of organizational models.

As I started to brainstorm on writing this article I thought back to The Sovereign Individual.  I know the book is really overplayed, especially in our space, but bear with me here.  In Chapter 5: The Life and Wealth of the Nation State, the authors discuss the work of Frederic Lane who developed a mental model for understanding where the control of government lies.  Lane believed there were three basic alternatives in the control of government, each with different sets of incentives: proprietors, employees, and customers

1. Proprietors: run for the benefit of their masters.  The Sultan of Brunei is mentioned in the book.  I think a good example for our space would be some of the cults of personality we see in crypto or highly centralized NFT projects where one or two founders hold all decision making authority (and keys to the treasury.)

2. Employees:  USG is the example mentioned in the book, for our purposes I think the corollary would be project teams and holders of the native governance token (assuming they are actively participating in the functions of governance.)

3. Customers:  Merchant era Venice is used as an example in the book.  In our example this could be users of the protocol or project or a specific L1/L2 network or project that the DAO helps to support.  A bit more on this concept a little later.

Like many of the concepts in the book this model holds true today decades after it was authored.  As I review the different approaches to organizational models prevalent in our space today I find that all of the different examples I have come across fall into one of these three camps.  In this article I will review a few of the more prevalent models including Foundations, Ecosystem DAOs, and Protocol DAOs.

I’ll attempt to contrast each of these structures against the different examples from the Sovereign Individual mentioned above and look at how these organizations decide on their goals, solicit and review proposals, allocate funding and ultimately make decisions on who to fund and how they will measure success.

Let’s start with Foundations.

Foundations

One of the reasons I originally became interested in grants and incentives programs was my background as a board president for a regional food bank.  The food bank is a registered 501c3 non profit in the US and, since the beginning of the pandemic, we have seen critical funding come in through grants from both government (federal, state, and local) along with different foundations.

Many times these “traditional” foundations are created through an endowment or initial seed fund and they have specific goals and objectives defined for how their funds should be used.  These goals and objectives are usually defined by the creators of the foundation and stewarded over time by a board of directors or fund managers who have a fiduciary responsibility.

The makeup and structure of these organizations in crypto is not much different from traditional foundations with some key differences:

• Initial funding for their treasury usually comes from a native token creation event that underlies the network or protocol they steward and support.

• They are focused on the development and sustainability of their ecosystem versus a public good like feeding people or building roads (though, sometimes these things can intersect across the metaverse/meatspace)

In looking at what kind of organization these foundations would most closely resemble from my Sovereign Individual example I think it would probably be an organization that runs for the benefit of its employees (namely the largest token holders, of which the Foundation and their stakeholders are usually part of.)  These organizations typically decide on their goals in alignment with what they believe will bring the best ROI for the token holders and drive activity on their network or protocol, specifically incentivizing developers and builders to create systems and applications that will drive up overall network value (a la the Fat Protocol Thesis by Joel Monegro.)

In terms of how these foundations solicit proposals it can vary.  Many of them have opted to use various kinds of submission methods and management platforms including Notion, Google Suite, Salesforce or crypto native apps like Questbook (yay!).  Overall, there is a lack of standards in this realm today and that is why at Questbook we believe there is an opportunity to learn what is working and not for many of these groups and see how we can purposely build our product to better fit the needs of the wider Web3 Community.

Funding allocations can vary as well and, at Questbook, we have definitely seen a decline in allocated funding amounts since onset of the bear market.  On a very positive note we have also seen many of our partners step up due diligence in review and overall allocation of funds.  Due to the centralized nature of many foundations, it is a relatively small group of stakeholders within the Foundation that makes that decision and is ultimately responsible for the results.  This can make the job of allocations fairly easy in terms of making a decision but those that have to live with the decision after the fact can feel that weight over time if things don’t go the way they had hoped.

“Everyone has a plan until they get punched in the mouth”

– Mike Tyson

Another aspect to foundations and more centralized grants programs is sometimes they can be stepping stones to more traditional VC opportunities.  There are many foundations today that maintain strong relationships with a network of VC’s and use this network to help broker introductions to these VC’s in addition to their own ecosystem funds that back early stage projects.

At Questbook, we have seen success with teams that set funding goals month to month or quarterly and work to align those funding goals to specific outcomes where there is also buy-in from the wider community.  Even if the decision making process for foundations is centralized that doesn’t mean getting feedback and learning from your community through engagement in forums, social, or events is off limits, quite the contrary.

We have found that foundations may vary in their desired levels of transparency (especially if they are more of the stepping stones to traditional VC as mentioned before) and, because of this, we have implemented privacy controls into our platform that allow for grants and bounty programs to mask application data in a way that is encrypted where even our teams are unable to see applicant and disbursement data.

Now that we have taken a high level look at foundations let’s dive in a bit to a more varied type of organization: Ecosystem DAOs.

Ecosystem DAOs

Ecosystem DAOs are interesting organizations that have started to pop up more and more since the last bull market.  If you are wondering what exactly an Ecosystem DAO is, it is a DAO that was created to help bolster support for a specific community or purpose.  Some examples of Ecosystem DAOs today would be MetaCartel and MolochDAO for Ethereum, Polygon DAO for Polygon (a Questbook Partner) Aave Grants DAO (also a Questbook Partner) for Aave, Climate Collective (also a Questbook Partner) for Celo, or Uniswap Grants Program (UGP) for Uniswap.

Usually these organizations were founded (and initially funded) directly from a grant or initial disbursement from the organization or community they were intended to support and their purpose can vary from functions like specifically managing grants and bounties for the community (like with Aave Grants DAO) and other times grants and bounties might just be one of the functions they help to provide.

As I compare these organizations to my Sovereign Individual example I think these mostly align with an organization that is run for the benefit of their customers (ultimately the project/protocol and their wider community).  Because of this their ethos is very much community first and many of them start with heavy community discussions and involvement to form their goals and areas of focus as they form and start to build their structure.  You can see examples of this in the initial forum post defining Polygon DAO or in the initial forum post defining UGP.

Ecosystem DAOs are similar in many ways to foundations in how they solicit and review proposals in their use of tools like Notion, Google Suite, Airtable and Questbook (yay again!) but we have seen them be more innovative in how they build systems and workflows around these toolsets that support collaboration and community involvement when compared to other types of organizations.

Examples of this innovation I could point to would be how Polygon DAO created Polygon Village as a one stop shop where builders can come to engage the community and find all the ways that Polygon DAO can support them.  Climate Collective and Polygon DAO have also seen success in adopting our platform to improve management of their grants workflows while driving down SLA’s in terms of response, review and approvals of their grants.

For funding allocations usually these groups have set budgets for some period of time like with Aave Grants that is approved and allocated from Aave Treasury or Polygon DAO was formed with an initial amount of funding from the previous DefiForAll Fund.  It is ultimately up to the DAO Lead or Grants Manager (if the Ecosystem DAO is specifically for management of grants) to decide on budgets and work within those constraints across the budget term.

In terms of the decision making process these groups usually operate by having analysts and reviewers that are responsible for ensuring the applications coming in meet the qualifying criteria set forth by the DAO and may have a process of peer review for larger or more complex applications.  An aspect of our product we have built thanks to feedback from Ecosystem DAOs like Polygon is features like evaluation rubric (used to help define evaluation criteria) or customizable reporting dashboards that can help to show trending metrics like disbursements, application flow, submission queue and more.

We have found that most of the teams we would group as Ecosystem DAOs want to be transparent and open in their approvals process including exposing the names and approval status of their applicants.  Whether it be full transparency or some level of privacy as mentioned before with Foundations our platform can help to provide the level of transparency desired.

Now that we have reviewed Ecosystem DAOs let’s take a look at Protocol DAOs and compare them using some of the criteria we have applied for the previous two types of organizations.

Protocol DAOs

Protocol DAOs are a more classic representation of the original “DAO” model (minus the mega hack and rollback that brought us $ETC).  These organizations tout decentralization and make every effort to drive engagement and governance from their communities using mechanisms like forums for discussion (Commonwealth and Discourse being the most popular) and governance token voting (using tools like Snapshot).

While these DAOs look to fulfill crypto’s ultimate promise of decentralization and further our efforts in the battle against Moloch they are incredibly hard to govern at scale and face unique challenges with driving balanced community engagement and fair consensus across all holders of the native governance token.  Some of the more prominent examples of these kinds of organizations would be Compound, Balancer, and MakerDAO.

First, let’s compare one last time against my Sovereign Individual example.  For these organizations I think that they would fall most into the camp of an organization that operates for the benefit of its employees (i.e. the native token holders participating in governance). This can create challenges in balancing governance with the largest token holders teaming to ensure their interests are met while minority holders that may have less weighted equity per wallet address (but may outnumber in quantity) are at a disadvantage in being able to have their voices heard or interests recognized without the ability to coordinate.  I think because of this and a certain percentage of these minority token holders being pure speculators we don’t see a balanced form of governance across many of the Protocol DAOs that are operating today.

In looking at how these kinds of organizations define their goals it is usually started in much the same way Ecosystem DAOs approach, through forums.  With these protocol DAOs many times there are respected community stakeholders (usually founders and/or core developers) that start these conversations and ask for other respected members of the community to weigh in and share their thoughts and opinions.  These discussions can move to Discord and other collaboration tools until proposals are formed and eventually voted on using systems like Snapshot.

These proposals can range from things like changes to the protocol, funding decisions, human resource decisions and a variety of other topics.  Whereas Foundations and Ecosystem DAOs many times have a more centralized form of decision making (more akin to traditional organizations) Protocol DAOs look to drive these decisions all from the community and its stakeholders.

Sometimes these proposals are focused on development activities, marketing or other community objectives that bleed into grants and bounties and that’s where our platform can come into play.  At Questbook we have created integrations with both Discourse and Commonwealth that allow for on-chain updates to be pushed between platforms allowing for tighter integration between platforms that Protocol DAOs use for governance and grants managements.

A major innovation we have helped to build at Questbook is the concept of Delegated Domain Allocators (DDA).  We developed this governance model as we witnessed some of the challenges (and opportunities!) present in the Protocol DAO model. At a high level the DDA model allows the community to select a grants manager (this can be outsourced to Questbook or one of our partners) or can be done “in house”, that is the choice of the DAO.  The Grants Manager would be a highly visible community stakeholder that is responsible for oversight and management of the overall grants and bounties budget.  Under the Grants Manager we have Domain Allocators, these are other highly visible and respected community stakeholders that have a specific area of expertise (security, SDK, etc.)

Delegated Domain Allocator Framework

Each of the domain allocators are given a specific budget that they have discretion to approve and disburse but all of their actions would be done in a way that is visible and open to feedback from the wider community.  We believe that this model cuts down on the amount of overhead and time wasted by the community delegating on items that could be quick approvals but still forces oversight and community awareness on the decisions being made by the domain allocators.

We recently started to work with Compound on CGP 2.0 on this approach and have received positive feedback and are in active conversations with many other protocol DAOs that are evaluating this model for their purposes.  While this model is not required for Protocol DAOs to use the Questbook platform we believe it offers a great option for those that are looking to either revamp their existing grants program or look at developing one anew if they have not yet created one formally as of yet.  We also believe that DDA could offer opportunities for Ecosystem DAOs and Foundations that are looking to launch parallel community funds to their more centralized grants programs as an option versus building a new structure from scratch and going through the pains of deciding on how to manage and steward them over time.

Closing

I hope you found this article informative.  We are still very early (yes, I said it ... we’re still early) in the development and growth of these organizational models and it’s an exciting time to be paying attention as things develop.  I have been told bear markets are for building and there is no better way to get exposure to building than working with these grants programs and seeing how they are contributing to the decentralized future that all of us know is possible.

Until next time, frens.

Sov

TLDR: Nouns has allocated 14,835 ETH since inception across 292 proposals via on-chain governance, Prop House, and small grants. 61% of these proposals have been completed, 37% of them are in progress, and 2% were incomplete*. While the ROI of specific allocations is difficult to measure, Nouns’ bid price, number of unique bidders, and treasury growth has held up over the past year.

Number of proposals and ETH allocated by category:

Completion rates of proposals by category:

*Incomplete includes abandoned/canceled/uncertain projects

Introduction

The Nouns community continues to fascinate us at Llama. We have published a couple of pieces focused on their unique model including Extending Nouns Through Invisible Traits by Austin Green and Designing a Nounish DAO: Analysis of Auction Frequency by gumfather. We will now dive into how effectively funds are allocated.

To date, ETH 26,695 has been amassed in their treasury (as of August 4, 2022) that are being allocated to community projects and special initiatives through three separate allocation mechanisms: small grants, Prop House, and on-chain governance proposals. We will review the efficacy of this segmented grant structure by answering the following questions across their allocation programs:

• How do Nouns’ funding mechanisms work?

• How effective has Nouns' allocation structure been in facilitating project completion?

• How can Nouns improve this structure as it continues to grow?

How is Nouns funding structured?

The primary source of funds for Nouns DAO are the auctions that take place every 24 hours. The Nouns treasury receives 100% of the proceeds from these auctions (denominated in ETH). Governance of the DAO is based on the Compound Governance model and is the main governing body of the greater Nouns ecosystem.  Each Noun is an irrevocable member of the Nouns DAO and entitled to one vote in all matters of DAO governance. We will dive more into the topic of Nouns governance in future reports so, for now, let’s stay focused on the topic at hand: how grants funds are distributed.

To allocate these funds, Nouns DAO has elected to manage allocation governance through three different programs: Small Grants, Prop House and Proposals. Each grant program is aimed at allocating funds for projects of a certain size (denominated in ETH) and tackle a specific set of DAO requirements.

As someone who has spent a fair amount of time researching grants and incentives programs across Web3, the different funding bands were an interesting approach and gave some segmentation in terms of types of projects and overall level of governance needed for review and approval.

As someone who has spent a fair amount of time researching grants and incentives programs across Web3, the different funding bands were an interesting approach and gave some segmentation in terms of types of projects and overall level of governance needed for review and approval.

How effective are each of these programs in facilitating project completion?

Small Grants

The Small Grants Committee was created through Nouns Proposal 13. The Committee controls a flexible pool of capital for smaller projects, provides retroactive funding for completed projects, and funds projects where the ask is too small for an official proposal. These grants are anywhere from 0.1-10 ETH. The capital used to fund these proposals is controlled by a funding committee consisting of four Nouns and the Nouns DAO itself (who is mostly there as a backup and symbolic owner). Disbursement of funds requires two of the members to sign a multisig transaction.

The program was originally provided 20 ETH as a pilot and immediately used some of those funds to retroactively reward a few of the community members to the tune of 2.75 ETH. Over time Nouns has passed more proposals (85, 43 and 31) to provide additional funds to the Small Grants Committee. These proposals added 50 ETH in January, 100 ETH in March, and 200 ETH in June (all in 2022).

The process to request funding for small grants is straightforward. All one needs to do is open a post on the Nouns Discourse forum with the prefix “Small Grants” and include some basic information including a project overview, how it will grow Nouns (or how it has already) and how much funding is needed (or retroactively owed).

Small grants example

Nouns Small Grants (like all Nouns grants) are relatively transparent with the projects and the amounts disbursed available both on this Notion page along with the the small grants funding page on Nouns Center.

The total number of grants that have been completed at time of writing is 105 proposals or ~95% with ~226 ETH disbursed from the treasury. There are currently 5 active projects with ~22 ETH in funding, all of which are on schedule. The Small Grants team does a good job of keeping projects on task and completing them based on the timelines agreed upon in each of the proposals.

The projects are tracked across a few different categories including Art, Charity, Community, Marketing, Operational, Physical, Staking and Tech. Some of the categories do overlap (meaning some might be called both Operational and Tech, for instance) so it is a bit difficult to give exact totals related to each category. Overall, Art and Community are the most active with a combined total of 74 (again, some of these overlap) while others like Physical, Marketing and Tech accounting for lower single and double digit totals.

Both Charity and Staking had no projects listed; that may be an area for Nouns to consider funding or focusing on.

Prop House

Prop House is an interesting model that looks to have creators submit their ideas to win auctions ranging from 2-10 ETH. In some ways, this functions a bit like Gitcoin Grants, where funding rounds are launched and anyone can create a proposal for community members to vote on and express their support. Where this differs a bit from Gitcoin is in that the amount for each round is predetermined versus an open bid where the amounts can change based on the number of contributions coming in.

The original auction house, known as Nouns Launchpad, was started in late March 2022 and has had seven separate rounds with anywhere from 2-5 ETH in funding allocated for each round. After the success of this model, separate community prop (short for proposal) “houses” have been created as a means to decentralize the applicant pool and boost the number of proposals that are receiving funding. This approach was formalized in proposal 62 where the concept of these independent houses was introduced. At a high level, these houses would all include different and distinct NFT communities that are focused on specific types of auctions that all serve the greater Nouns Ecosystem.

An interesting quote from the information available that sums it up quite nicely:

“If the ERC-721 standard is thought of as the social graph, Prop House may be looked at as the permissionless power source that communities gather around. Akin to reddit, I believe we will see NFT communities for every niche imaginable.”

At the time of writing, there were a total of 84 projects with 278 ETH total granted. The projects had the same categories that were present in Small Grants (Art, Charity, Community, Marketing, Operational, Physical, Staking and Tech) with a similar funding makeup; Art and Community carry the lion’s share of funded projects. There were a couple of entries for Charity totaling around 4 ETH with Staking still being at zero.

There are 84 total projects to date on Prop House, out of which 22 are completed (26%), 35 are on schedule (41%), 3 are behind schedule (4%), 3 abandoned and uncertain (4%) and 21 that currently do not list a status (25% - these are mostly Lil-Nouns projects with a few from NounPunks). Overall it seems that they have still done a good job of ensuring progression of these projects considering they are larger and more intensive than what is being proposed with the smaller grants.

On-Chain Proposals

The last area we’ll examine in terms of grants is their on-chain Proposals. This category consists of larger funding requests ranging from 10-1,000 ETH. For this category, only Noun Owners (“Nouners”) are able to request funding. If someone would like to make a request for funding without owning a Noun, they can seek sponsorship from a Nouner by posting their idea in the Discord or Discourse or by contacting groups like Nouncil or any of the numerous Nouns’ sub-DAOs to see if they may be willing to help.

In looking at the requirements for a proposal it does ramp up a bit in terms of details needed including a detailed breakdown of how the funds will be allocated and what are the success metrics in play for the project. Nouns does ask how these proposals are structured to provide both a high level overview of the task and then be very specific in follow-on sections to detail out.

Once the proposal is submitted it will undergo what is known as a “Voting Week” which is a minimum of seven days. There is a visual overview of this process is shown below:

Nouns voting process

The categories for these proposals mirror those previously mentioned with a couple of additions: Investment and a more broad category termed “Other.” A total of 123 projects at time of writing were brought to proposal, with 98 of those passed for a total of ~14,309 ETH. The projects that didn’t pass were either defeated (voted down), expired, vetoed or canceled.

As we review further, the mix of projects funded shows more diversity in terms of category spread versus previous programs. As many of the projects are spread across multiple categories it is hard to break down specifically the funding and count for each. Marketing and Community seemed to lead the way with mid double digit counts and 4,000 to upwards of 5,300 ETH respectively. This seems consistent with what the community believe is the goal of Nouns governance (as per the inaugural Nouns survey) - to ‘proliferate the meme’. Other categories such as Art saw lesser numbers in terms of overall funding versus previous categories while Charity and Staking saw increased amounts relative to previously reviewed programs.

50 of the 98 granted projects have been completed (51%) with another 38 on schedule (39%), 6 behind schedule (6%) and 4 either uncertain, canceled or abandoned (4%). Like the other programs it seems there is a relatively high success rate for the on-chain Proposals even with the added overhead of governance that is introduced.

Concluding Thoughts: Path to the Future

The allocation mechanisms at Nouns are set up to fund interesting experiments quickly, reward talented contributors, and proliferate the Nouns meme.

Proliferating the Nouns meme is a difficult goal to attribute ROI for specific projects. However, Nouns’ bid price, number of unique bidders, and treasury growth has held up over the past year. Allocations have been relatively successful in facilitating project completion. 61% of the 292 projects have been completed and 37% are in progress.

The Small Grants program has allowed 100+ grants to be completed in the past year. The program has created as little friction as possible for builders and creators to charge ahead with their ideas. When completion rates on smaller grants start to tail off (e.g., with proposals on Prop House), Nouns team appear engaged on key forums and aware of the progress on these, with support being offered to ensure progress.

With Nouns continuing to grow, it is inevitable that the size of funds requested, and complexity of on-chain proposals for which the funds are being requested, will continue to grow. Nouns community would benefit from requiring proposals to define success metrics in advance, so the efficacy of the funds distributed can be monitored with greater rigor, and the treasury can move forward with active insights. Where proposals are complex and involve a lengthy development phase, Nouns should consider introducing milestone based payment structures so that the community can be rewarded for ongoing efforts.

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Artwork credit: 0xEFRA.

Here again for another research report. My last report on the Uniswap Grants Program was very well received by the community and I would like to thank all of you that sent me DM’s and commented on my work - very encouraging!  I’m still a bit surprised at the response to this bear market project of mine and very much appreciate all of the kind words and support.

In addition to my research reports I have just kicked off a monthly Crypto Grants Wire series, previewing the latest news on the various grants and incentive programs around web3.  If  you want to keep up with big-league grants and their long term impact on our industry, check out the first edition below:

Today, we’re going to dive head first into the magical world of Polygon and take a look at how their incentive programs have evolved over time - from their Matic origin story to the multi-headed hydra they have become today.

We’ll start with a bit of history on the early days of Matic, breeze through their transformation to Polygon, and finally, highlight the current state of their ecosystem fund, partner funds and the one and only Polygon DAO.

Alright, anon. LFG.

Polygon: Origins

So what is Polygon?  Well, in writing this piece I came across a great summary of the Polygon protocol by Messari and thought I would just quote it here since I couldn’t have said it better myself:

“Polygon is a platform designed to support infrastructure development and help Ethereum scale. Its core component is a modular, flexible framework (Polygon SDK) that allows developers to build and connect Layer-2 infrastructures like Plasma, Optimistic Rollups, zkRollups, and Validium and standalone side chains like the project's flagship product, Matic POS (Proof-of-Stake).”

Polygon has evolved over time into a broad and diverse ecosystem that ties into many different “decentralized” networks. It was originally launched as the Matic Network in 2017 and co-founded by some seriously big-brained individuals: Anurag Arjun, Jaynti Kanani, Mihailo Bjelic, and Sandeep Nailwal.  The founders recognized the potential of Ethereum scaling solutions and set their sights on addressing that need instead of arguing about the Bitcoin block size or salivating on the plethora of ICO ponzis that some of us (raising my hand high) were enamored with around that time.

When they started on this journey, the Polygon team was very much at the forefront of scaling solutions and primarily focused on Plasma and Proof-of-Stake sidechains as their prerogative.  Plasma was initially discussed by Lord Vitalik and Joseph Poon in this late 2017 paper that described a framework for building scalable applications on top of Ethereum. You might recognize Joseph as the guy that also introduced the topic of scaling to Bitcoin (via Lightning Network) circa 2016 along with Thaddeus Dryja.

I’m definitely not the one to ask for deep analysis on Plasma (unless you’re actually looking for a good laugh) so check out this entry on EthHub (gud resource, ngl) if you want to learn more.  

In 2017, the Matic network was one of the only players in the scaling game and by far the most prominent,  this allowed them to gain quite the head start as the demand for Ethereum rose.  On February 9th, 2021, the Matic team decided to rebrand as Polygon, as they felt the name was better suited for global recognition as their popularity started to grow.

… and oh, has it grown.  At the time of writing, Polygon is ranked in the top 20 by market capitalization and top 10 by TVL for different blockchains. Even in the bear market they continue  to grow their team and strategic partnerships, and tout thousands of different applications and projects now running on top of their network.  

Most interesting to me (if you care) is their doubling down on investing in new focus areas  rather than just resting on their laurels. With the success they have seen in their ongoing approach to scaling, Polygon’s future plans include adding support for Validium and ZK Technology to their existing architecture, along with building a strong ecosystem of new partnerships.  

I also appreciate their commitment to being environmentally conscious at a time when Nobel Prize-winning economists seem fixated on that aspect of our industry -  probably since they can no longer push the narrative of all of our tokens going to zero (even though a few high profile coins certainly have as of late!)

Alright, enough ancient history.  Let’s dive deep into the current areas of focus for Polygon, then head into the main event: grants and incentive programs!

Read on, anon!

Polygon: Areas of Focus

With the onset of the bear market and many alternative L1/L2’s struggling (don’t take my word for it - check out DefiLlamai), Polygon continues to position itself as the leader in both cross-chain interoperability and scaling innovation. Here’s a (somewhat) recent tweet from the CEO of PolygonStudio, Ryan Wyatt, explaining their current position  on hiring, cashflow and their high-level roadmap for the next few years.

As you can see from Ryan’s slides, the Polygon team is  doubling down on their initial thesis and sure seem to have the treasury, partnerships and momentum to keep things moving in the right direction. Only time will tell, but it definitely seems the future is bright for Polygon, especially compared to some other high-profile projects  we have recently seen fall from grace due to mismanagement, bridge drains, stablecoin depegs and a host of other interesting reasons - each worthy of future zachxbt investigations or spots on the legendary rekt leaderboard.

One area of particular interest to me is Polygon’s investment and development in the fast-growing ZK roll-up space. In fact, Polygon launched a $1B fund last August with  a strategic focus on ZK (zero knowledge) technology, and have so far put that money to good use with their acquisition of Hermez in late 2021.

Not only was the Hermez acquisition a huge step forward for Polygon in terms of continued development and growth of their platform, but it also marked the first token merger in the history of crypto. M&A is definitely on the rise across the industry and is a fascinating topic in and of itself, and I predict we will only see more of this kind of activity and consolidation  throughout the current bear market.

In addition to their acquisition of Hermez, Polygon’s ZK roadmap  also includes their in-house work around Nightfall, Miden and Zero.  Just this week they made a huge announcement with the release of zkEVM. Future of France is coming together quite nicely, anon...

In addition to their focus on ZK roll-ups, we are seeing Validium-based solutions like Avail progressing through development. There was also a recent announcement around PolygonID, a scalable blockchain ID solution developed from the ground up using ZK-based privacy. This could have all kinds of interesting implications for DAO Governance and a host of other use cases, and will be exciting to watch as they continue to build out their USP. 

 If you are interested in exploring the landscape of Identity and Social further, some guy named Sov has a Notion Site where he curates all projects in that niche that he’s found, with links to sites and short descriptions. He definitely needs better hobbies.

To close out the multiple areas of focus across the Polygon portfolio, I would be remiss if I didn’t mention the massive premium they put on gaming.  As a guy that has been a gamer my whole life and even managed a Gamestop store in another lifetime (circa release of the original Nintendo Wii) this is a topic near and dear to my heart.

This, evidently , is an interest that I (and lots of other blockchain nerds) have in common with Ryan Wyatt.  Ryan was the guy that led YouTube’s gaming division for eight years prior to coming on board as CEO of Polygon Studios. There’s a great recent video of Ryan from Radio City Music Hall (linked below) talking about how he thinks Polygon is going to change the game (pun totally intended) in this emerging niche, and why their tech stack provides a robust infrastructure for blockchain gaming. 

I hope I have provided enough information here to give you a jumpstart on the areas  that Polygon is doubling down in terms of development and growth.  There’s plenty more to explore across their ecosystem and you can always head over this site if you want to learn more.

Alright … it’s time for the main event.  

Now that we know what Polygon’s all about, let’s take an extensive look at their grants and incentive programs. We’ll start with a bit of history then dive into a deep review of the different programs (and value-added services they offer to Polygon’s partners) currently available via Polygon Village and their Ecosystem funds.

Polygon: Legacy Programs

Matic Grants

I did some research and found the first Matic grants program that was launched way back in March of 2019, known as the Matic Developer Support Program (DSP).  

This program focused on helping with technical issues (Scaling, UI/UX, Developer Tools), financial sustainability, talent sourcing and brokering relationships with investors once projects made a viable MVP and were ready for the next step. You can read a bit more about the program in this medium post that the Matic team released.

The TL;DR is that $500K was allocated to fund grants for dApps and other DeFi/Ecosystem projects accepted to DSP.  Under the DSP, any project being built for the Ethereum ecosystem which directly supported Matic was eligible for a grant.

The governance of the DSP was under the purview of a small group internal to Matic which was responsible for review and approval of all incoming grants requests.  This group included some of the original founders along with key stakeholders responsible for business development and protocol governance  in those early days.

With the apparent success of this program, Polygon (then still Matic) upped the ante in total funding available in July of 2020.  There was a Coindesk article published here that describes some of those updates. In short,  the amount of funding was raised significantly along with  the focus shifting to dApps building directly on Matic versus projects also building on Ethereum, as was laid out in the initial announcement.

I wasn’t able to find specific details as to the recipients of DSP grants other than various blog posts which mention projects here and there, but nowhere a comprehensive list.  I think the evolution of Polygon from 2019 to now is probably testament enough to the success of their early efforts to grow the ecosystem and incentivize developer participation. Seems like things worked out for them, eh anon?

#DeFiForAll

After the initial success of the DSP and the Polygon rebrand, the team kicked things into high gear with their #DeFiForAll (DFA) fund.

The DFA fund was launched in April of 2021 and was one of the first in a long line of these kinds of programs, touting huge amounts and even higher hopes in how it might contribute to continued development and adoption of Polygon. There’s a great infographic from the good folks at Coin98 Insights of the larger funds like DFA and the timeline of their announcements     

(You can also check out LlamaoGrants for a list that I curate myself and try to keep current with all the open grants and incentive programs I have found throughout my research and network of sources. Some more details on that below in a thread I sent out on the bird app a few months back.)

DFA was initially launched with 2% of the total $MATIC supply (roughly $150M based on value of $MATIC at time of launch) with the mission to bring the next million users to DeFi.  The fund included both a grant component and an incentive program.

I find these two terms get interchanged quite a bit in crypto so I took a stab at separating their definitions, as I think they are two different things (though the funds to support both may come from a single source).  You can also find my definition of these and other related terms on LlamaoGrants (sorry, shameless plug again).  Anyway, here’s how I see the difference between the two:

Grants: Grants are defined as “an award, usually financial, given by one entity to an individual or an organization to facilitate a goal or incentivize performance. Grants are essentially gifts that do not have to be paid back, under most conditions.

Incentive Program: Incentive programs are defined as any collection of funds that are awarded based on development of new ecosystem projects, current project ports, or weighted performance (usually measured by TVL).  Incentive programs typically have an expectation that there is some kind of return on investment or equity given as part of the funds being disbursed.

For the grants portion of DFA there were numerous projects that were granted. I did create a notion list that you can find here listing all of the projects that received grants that I was able to find through various sources.  This list is by no means complete and amounts, dates grants were given or other specifics were not available based on the information I had.  This is the best you get anon.

The governance of DFA functioned much the same as its DSP predecessor, with decisions being made by a group internal to Polygon that was responsible for review and approval of all submissions.

Gitcoin

In addition to their own internal programs, Polygon has been an active participant of the legendary Gitcoin Grants since 2019.

Polygon has also been a regular contributor to the matching funds pool and has participated in multiple Ecosystem Rounds alongside the likes of ENS, Radicle, Open Gaming and various ZK Technologies.

Now that we’ve covered Polygon’s previous grants and incentive programs, let’s  review  their status quo,  including funds under the direct purview of Polygon and their various partnership funds.

Polygon DAO

Polygon DAO (sometimes referred to as “EcoDAO”) was first announced in August of 2021 and was formed using some of the funds and resources from the DFA fund. The main driver for the creation of Polygon DAO was the desire to decentralize and drive the ecosystem to be more builder-centric. I think Polygon also wanted to move from a more marketing centric approach as seen with many of these grants programs at the time to a more sustainable model that could be around for the long term and focus on quality over quantity.

The program rationale is described in further detail in an October 2021 forum Post by the current DAO Lead, Marco Grendel, outlining many of the core goals and objectives along with early processes for engagement in terms of grant submissions.  

These goals and objectives (or “growth steps”) include:

• Form a heterogeneous team capable of founding a new DAO and managing it from different angles 

• Create increasingly decentralized procedures for the analysis, approval and issuance of grants

• Progressively open up to projects and to all communities

• Create the dynamics of value creation within the DAO, building meeting points between creators and projects

• Progressively evolve the concept of governance, decentralizing it more and more and using new support tools

• Become one of the most important poles for the organic development of the crypto ecosystem

Areas of Focus

Polygon DAO’s initial areas of focus - based on the initial forum post mentioned above - are listed below:

• DeFi and NFT projects on Polygon PoS, SDK and Hermez chains. This now also includes PolygonID.

• Tools for DeFi protocols on Polygon.

• Tools for data analysis on Polygon.

• Educational projects related to the world of DeFi present on Polygon - in line with the #DeFiForAll vision.

• Decentralized editorial projects that have an informative and educational function related to the world of DeFi on Polygon.

• Frameworks,development and support tools for DAOs on Polygon.

• Tools for managing and reporting treasury funds from projects and DAOs on Polygon.

In addition to the areas mentioned above, Polygon DAO will continue to offer the support for builders and developers in areas such as IT development, branding, marketing and community, as Polygon had been providing prior to the launch of Polygon DAO.

Programs

Next, we’ll dive in a bit to the various programs that Polygon DAO has launched for builders, developers and creators. They have a very intuitive website called Polygon Village, that can help guide the interested parties in all the different ways they can engage with and request support from the DAO.

These different types of support that Polygon DAO  provides include:

Welcome Vouchers

This is a concept that I found quite interesting. Vouchers are very similar to AWS Credits (minus the drab corporate overlord) and allow access to preferred Polygon partners for services including hosting, auditing, marketing, liquidity, hiring, API services, education and their job board, to name a few. These Welcome Vouchers will be free and available to projects based on certain criteria. There is a google doc available here that explains the concept and mechanism of Vouchers in more detail.

Grants

A topic near and dear to Sov’s heart (I know, I need better hobbies). This includes grants given directly from Polygon DAO as well as  any shared grants like the ones they have done with mStable and Idle DAO.

Currently, the grants are given month-to-month and have averaged around $50K available for disbursement over the last few months. I was able to obtain a list of all the recipients through June and have created a simple notion site listing all grant recipients as well as which month they were granted funds for their project.

The amounts given to individual projects are  not publicly available but grants average anywhere from $5K-$10K depending on the size and scope, according to the Polygon DAO Team.

Grants are managed via the Questbook platform (a seriously interesting project unto itself, anon) where potential grantees can view and select grants that they may be interested in and apply directly.

You can check out Polygon DAO’s grants profile on Questbook here to see what grants are available, or head over to their Discord and find the #grants channel where you can ask questions and interact with the team responsible for this program.

Village Wonders

The term ‘accelerator’ is used quite a bit in our space and describes an organization or program that helps early-stage tech projects develop their product, hone their business model, and connect with users or investors. You might also be familiar with the term ‘incubator’ and wonder  about the difference between the two. Incubators usually help projects refine business ideas and build their company from the ground up.

In comparison, Polygon is forming up something called Village Wonders that acts as a pre-accelerator providing a limited number of projects that already have a minimum viable product (MVP) with support like education, resources and mentorship needed to grow and promote their work. Polygon will be presenting more on this in the week ahead along with some really exciting announcements that have already been teased a bit on Twitter so you’ll want to stay tuned to official channels to learn more.

As it relates to Polygon DAO, they have already been providing projects with help in the form of educational calls & Discord AMAs with various web3 experts, along with a forum to pitch their offerings to the wider Polygon community and receive feedback.

Of note on this topic is the fact that Polygon itself was recently added to an exclusive accelerator program with the one and only Disney. This was a pretty big announcement and validates their investments in areas like gaming and NFT’s where Disney has a keen focus on.

Job Board

It doesn’t take much time on CT (that’s Crypto Twitter for those of you that are NGMI) to see that basically everyone claims to be hiring. The “always hiring” tagline is a bit misleading in most cases, as many of these projects only want temporary work or freelancers or really just want to *look *like they are hiring.

Aside from this narrative you are starting to see more anons, projects and DAOs host their own hiring boards via platforms like Pallet and Notion, along with HR Telegram alert channels (LobsterDAO and Daily Ape HR I’m looking at you). Some guy named Sov even took the time to list all job boards he could find on his compendium if you want to see a comprehensive list.

While many talk about hiring, the folks at Polygon are pretty serious about it. You can look no further than messaging from the top down by Polygon Studios CEO Ryan Wyatt in the thread below to see they mean business, with 100+ open roles across their portfolio.

Polygon DAO has built a robust jobs board that details all the open opportunities across Polygon and their partners, and has even partnered directly with Devfolio to launch WAGMI JobDrops and host virtual job fairs. You can check out more on this in the thread below or head over to the jobs board directly here.

Whether it be Sov’s Compendium or WAGMI Jobs, if you’re looking to opt out of your boring day job and go all in on the future of France , these are some good places to start looking. The grass is not always greener and honestly it’s mostly weeds, so at least be in the weeds that you love.

Bounty Board

Like I mentioned before there’s actual jobs (full time / part time) and then there’s freelance work and tasks that are honestly better termed as “bounties”.  Polygon has (thankfully) separated these two categories and partnered with Dework (one of Sov’s Favorite DAO Tools!) to host open bounties that are available for anyone to pick up and run with.  You can check out the board here and see if any of these might be things you want to help with, anon.

Polygon: Funds

Today, Polygon has a diverse ecosystem of funding channels that are both managed directly - like the Ecosystem Fund and Polygon DAO - along with partnerships with Wintermute, 776, Outlier Ventures and Stable Node.  

From here, we’ll take a look at the funds that are managed directly by Polygon first and round out this section with some high-level deets on relevant  partnerships.

Ecosystem Fund

According to PitchBook, the Polygon Ecosystem Fund is a venture capital fund managed by Polygon and headquartered in Bangalore, India.  The fund is dedicated to growing and supporting the shared Ethereum and Polygon Ecosystems with a focus on   DeFi, Web3, infrastructure, NFT’s, metaverse, and gaming.

The Ecosystem fund is quite active in investing through much of their portfolio and investments are not public (as typical with many funds of this kind). One area related to the fund that is quite public has been Polygon’s In addition to the size and scope of the fund it is growing in terms and has multiple job opportunities open 

Partnership Funds

In addition to the core Ecosystem Fund, Polygon has four other partnership funds that are focused on specific areas of the wider ecosystem. They have partnered up with some pretty heavy hitters including Wintermute, Stable Node, Outlier Ventures, and 776. 

Not many details for these programs are available but I have provided  a brief explanation below (mostly copypasta from the Polygon Funds page) to give you an idea of what they are all about.

Wintermute

$20M fund targeted at helping to build web3 native dApps on Polygon. This includes support for development, liquidity provisioning, exchanges and business development. Wintermute is one of the leading algorithmic market makers and has also partnered with other major protocols like Ethereum, zksync, and Optimism. You can read more about them here. 

Stable Node

Amount not disclosed. This fund is aimed at early-stage ventures and offers a range of value-add services like fundraising, token design, liquidity provisioning, marketing and governance.  Stable Node is primarily a node validator service that has partnerships with Ronin, Hashport, and Klaytn (to name a few) in addition to their relationship with Polygon.  They provide a broad range of value-add services next to their core offering.  You can read more about them here.

Outlier Ventures

Amount not disclosed. This fund aids in fundraising, community growth, token design, business development, and governance, along with offering access to Outlier’s network of mentors and leading web3 founders. Outlier’s website looks like a Nascar jacket with the number of partnerships they have in their portfolio (sorry, it’s true), and they offer accelerators and scaling programs in addition to their partnerships with various other organizations.

776

$200M joint fund focused on boosting support for web3 technology, social media and blockchain compatibility. One of 776’s founding partners is Alexis Ohanian who also founded a small site none of you have probably heard of called Reddit. They too have an array of partnerships listed on their website spanning  all kinds of different organizations. You can read a bit about Alexis’ perspective on why he started 776 on this recent blog post here.  

While Alexis isn’t leading Reddit these days and sold it for much less than its current valuation, the platform has been making some moves related to crypto hires and recently announced they would be launching an NFT marketplace (and guess where it’s landing?)

Closing…

Alright anon, that’s all I got (for now…)

Hope that you found this report informative and mildly entertaining. I try to inject my terrible sense of humor here and there so I don’t bore you to death too much with my weird hobbyist writings.

I’ve got a few more research reports that I’m starting to look into t so you’ll want to make sure to stay tuned to Sovereign Signal for these as well as my new monthly Crypto Grants Wire series.

Aside from my newsletter you can always stop by LlamaoGrants to see the latest list of grants available (and updated, like, all the time) or follow me on Twitter to keep up with new things I am doing or find interesting. I promise not to tweet too much or fill your feed up with bull/bear musings or charts. This is mostly because I really have no idea what I am doing there and I still can’t draw a line.

Peace,

Sov

Uniswap Grants Program

Back again.

For those of you that are joining us here for the first time my bear market project has been analyzing grants and incentives programs across crypto. I have a background in working with traditional non profits (I’m Board President at a food bank) and seeing all of these programs piqued my interest.

After a bit of initial review I realized no one was really tracking them so I figured I might as well try. I maintain a list of all the active programs at LlamaoGrants and you can find my research right here on my blog, Sovereign Signal. I think these programs are important to growth and sustainability of our space given we don’t have central authorities (see: governments) providing funding like with traditional grants and figured with my background working in and around these programs and my OCD nature I could start keeping a list and doing some research to uncover more details on what is working and not. You can read a bit on how this all got started on a previous post I did here called The Common Good.

In this report we’ll be diving into the Uniswap Grants Program (UGP), it’s my most comprehensive to date. I’ll start off by reviewing the history of both Uniswap and UGP, and then dive into some details on the current state of the program and  - for those looking for further reading - outline main information hubs for a number of UGP-related topics.

Uniswap: Origins

Uniswap was publicly announced by its founder, Hayden Adams, on November 2, 2018 and (roughly) two years later  their treasury was online.  Late 2018 was really the first time anyone had heard of the project, but for Hayden it represented the culmination of months of work towards something that was, at the time, poorly understood and fairly underappreciated in terms of its potential impact  - not only on the crypto space, but the global financial system.

You can hear Hayden’s story from the horse’s mouth in this post that he published on the Uniswap blog back in February of 2019.  If you want the TL;DR, I’ve penned a relatively brief overview below; if you already know this ancient (but important!) history, feel free to skip down to the next section for the main course

Hayden was laid off from his first job out of college back in 2017 and felt pretty down and out. His friend, Karl Floersch, was working for the Ethereum Foundation and mentioned to Hayden that he should bone up on things like smart contracts, proof of stake and trustless computation, because there were not many people focused on these issues at the time, and the upside for anyone that crossed this chasm could be huge.  I personally found it hilarious that Karl mentioned to Hayden  that he was “early”, because - next to verbiage like “HODL”, “diamond hands” and “institutional demand ” - this has been one of the better psyops we have seen emerge from our space over the last few years.  Back in 2017/2018, guys like Hayden working on these kinds of problems really *were *early, whereas today all of us just seem to be exit liquidity for our favorite bird app influencers.

Luckily for us Hayden immediately got to work on a “real” project (his words not mine, anon) by putting his efforts into building a first-of-its-kind AMM, as described by Lord Vitalik in this post from his blog.  You can actually still check out an early version of Uniswap here if you want to feel some nostalgia for the good ol’ days. Uniswap wasn’t the first DEX (that was Etherdelta) but it marked huge improvement in terms of UX and design, and was eventually featured by his friend Karl at his  Devcon 3 talk.  Thanks to this presentation,Hayden was introduced to another key member of the story, Pascal Van Hecke, who brought some new ideas to the table and helped with a grant to fund Hayden’s ongoing research and development of the project.

From there, things continued to progress for Uniswap, but the market was changing under Hayden's Feet.  The stack of crypto that he was living off of eventually went down 75% from its high (sound familiar?), and he needed additional funding to continue his work.

Hayden eventually found his way to meeting with more key members of the Ethereum Community (including Vitalik), and was able to continue the development of Uniswap thanks in large part to a grant from the Ethereum Foundation.  When you look back through the history of grants given by EF, this was probably the one that had the biggest impact on the community, especially considering that the Uniswap Protocol recently passed a total of $1trn in transactions and was in many ways the catalyst for the  2020 DeFi Summer (oh those were the days, anon).  All in all, a pretty incredible return on investment from the initial $100K grant.

Some other notable projects that originated from the EF grant program include ENS, Starkware and Gitcoin.  EF has also been highly focused on enabling underlying technologies that support scalability, security, usability and privacy improvements to the underlying Ethereum Network.  I’m planning on doing a comprehensive review of the Ethereum Foundation and their programs in a future edition so you’ll definitely want to stay tuned for that.

Through determination and perseverance, Hayden was able to finally release his project to the world at Devcon 4 and the rest, as they say, is history.  Now, onto the main event: a review of the Uniswap Grants Program (UGP).

UGP: History

Like pretty much all grants and incentive programs, our story begins with a treasury to fund further development, which in the case of Uniswap was established in September of 2020.  Many of us primarily remember this as the time of the $UNI airdrop ,but with airdrops usually come grant programs, as they are funded from the same source.

The Uniswap grants program was originally discussed on their governance forum all the way back in December of 2020, in a thread initiated by Jesse Walden of Variant Fund and co-authored by Ken Ng.  The program was formally voted on and started accepting applications on January 15, 2021, and was intended to leverage Uniswap’s treasury for further development of the protocol, as well as to help raise awareness and access to the magical world of decentralized finance that Uniswap was at the forefront of.

The original proposal targeted a max cap of $750K per quarter with the ability to reevaluate twice a year at each epoch (two fiscal quarters).  Some  more details can be found on that initial governance forum post describing the grant program.

The program operates via the concept of “waves”, although so far there has not been a strict cadence (predefined start/end dates) established for said waves, as the volume of applications and approvals varies according to the UGP team.

Areas of Focus

UGP’s initial areas of focus - based on the initial governance forum post - are listed below:

• General Ecosystem Funding

• Key Components and Integrations

• Core Protocol Development

Upon further review of the program, the information available online and on their Airtable/Notion Site, Wave 9 (the most recent wave) lists the main areas of focus for UGP as:

• Usability - improving the user experience

• Community - growing the ecosystem

• Tooling - improving the developer experience

In addition to these areas, it is also possible for applicants to pursue specific RFP/Challenges or “other” areas that will be reviewed and ultimately approved at the discretion of UGP.  Some of these RFP/Challenges include pretty interesting topics like UNI Treasury Management, Inclusion & Access, as well as Security, and might be worth checking out if you are looking for ways to contribute to the protocol.

I tallied up the totals across the different categories listed on their notion site, and here’s what the cumulative funding looks like for each category, across all waves, at the time of writing:

In addition to the places UGP directly focuses on, they have been contributing to matched Gitcoin Grants since Wave 9.  These are passively matched funding rounds with decisions and disbursements coming directly from Gitcoin contributors/donors, according to the Quadratic Funding rule.

UGP: Disbursements

There is a publicly available notion site along with the project’s Twitter where disbursement announcements are posted; this is where I tallied up the amounts mentioned above from.  I also created my own notion site to consolidate the information gathered  from the UGP Notion site.

If you add up the sums from that Notion site it shows ~$6.4M in distributed funds across a total of 121 separate disbursements.  This total does not include the DeFi Education Fund which was passed as a standalone governance proposal (which means it technically wasn’t even a part of the grants program), or the individual allocations for the Community Analytics program, both of which I review a bit further down in this piece.  Those excluded, here’s the breakdown of UGP allocations for each Wave to date:

The assets and distributions are typically denominated in fiat ($USD) but disbursed in $UNI tokens only (following the market rate around the time of disbursement), as UGP   exclusively holds and disburses $UNI tokens.

Top UGP Recipients

I thought it might make sense to dive in a bit deeper into some of the top recipients of funds from UGP, so I took a look into all grantees that received $150K or more in funding (9 total), with more  information  on them below:

Other Internet - Governance Experiments: $1M

• This grant was focused on funding a series of governance experiments and research within the Uniswap community, presenting reports with generalized insights on Decentralized Governance.

• There’s a page that is separate from the UGP site here, and it describes the finer details of this program.  If you want the TL;DR, it lists the overall operating principles for this initiative as:

  • Focus on increasing the quality (rather than the quantity) of governance proposals

  • Create more off-chain affordances for UNI holders to contribute to the ecosystem

  • Ensure that each Uniswap entity (Labs, Grants, Governance, working groups, and any future teams) has a clearly defined mandate, which describes its scope and responsibilities

  • Help community members who have a wealth of good ideas but not a lot of UNI participate meaningfully in on-chain governance

• In addition to the outline provided on the home page, there are quite a few formal research entries that you can find here.  Many of these are very detailed and would have taken considerable time, effort and brains to compile.  Definitely worth taking a look.

Ethereum Execution Layer Support: $250K

• This was an interesting proposal where Uniswap partnered with Compound Grants, Kraken, Lido, Synthetix and The Graph to support the Ethereum execution-layer client teams.

• The funds allocated were meant to supplement a significant amount of funding that was already being provided towards this initiative by EF.  You can read a bit more on this topic here.

Unicode hackathon: $250K

• This grant was used to fund UniCode, a virtual hackathon focused on the Uniswap Protocol.  There’s a blog post here that talks more about the grant and describes the importance of this initiative as an opportunity to bring community members together, so that new projects can be formed that benefit the ecosystem as a whole.  You can find more details on the UGP Notion Site Blog.

• All in all it looks like $125K+ in prizes were given out across 96 projects and 351 “Staked Hackers” (their words, not mine anon).  There is a blog post on the EthGlobal Medium here with more of the nitty gritty details if you are into that kind of thing.

The Stable Subcommittee: $414K (3 different grants)

• "The Stable" Subcommittee helps  provide rewards in the form of increased influence in UNI governance for contributing individuals.

• There are a few pages on their notion site (here and here) with details pertaining to these grants.  It was originally established in Wave 2 and they also have a Twitter Account, but it hasn’t been very active since 2021.

• I discovered a YouTube Video with some great information and discussion on this and other topics if you are interested in that kind of thing (like me!)

Unigrants Community Analytics Program: $250K

• Mentioned below in more detail.  This seems to be a key area of focus for the UGP program today and looks to continue in future waves.

Rabbithole - L2 quests: $220K (2 grants)

• These grants were created to fund ongoing development of their platform and focused on the creation of many new Layer 2 quests, along with the onboarding of Uni v3 for the Rabbithole.gg platform.

• There isn’t much information available on this grant aside from it being listed on the UGP Notion site.

DeFi Alliance: $150K

• The DeFi Alliance was founded in March 2020 by a team of crypto veterans in partnership with top-tier trading and venture firms that include CMT Digital, Cumberland, JumpCapital, Volt Capital and Coinbase.  You can read more about DeFi Alliance’s roots and the team on their website here.

• DeFi Alliance launched their own Grants Aggregator in May of 2021, where builders are able to submit a request and apply for multiple grants from one simple google form.

• The list of projects that have been funded through DeFi Alliance is a proverbial ‘who’s who’ across the space.  The program offers Deal Flow, Service Opportunities and Networking Opportunities for builders.  You can apply at their website here; the next cohort starts on 9/6/22.

Team Secret: $225K (2 grants)

• Team Secret is an eSports team that has received two grants from UGP totalling $225K.  The partnership was aimed at Team Secret creating educational content around Uniswap as well as developing eSports industry activities for the partnership.

• There’s some high level information about the partnership  on Team Secret’s blog here, along with various posts on their twitter feed (you can see them using this custom search I created), some mentioning of various Team Secret players as the  “Uniswap MVP”

• I wasn’t really able to find much educational content on Uniswap that was created by Team Secret other than the above Twitter posts. They do currently have a banner ad on their site (along with Corsair, Secret Lab, and Tumi) but it just links back to the main uniswap.org page.

Scopelift: $150K

• Scopelift is a software engineering consultancy that specializes in crypto.  Their grant focused on various governance upgrades, including spinning off the Uniswap governor as an independent community group.

• This team has a history of design and implementation of governance deployments with their Seatbelt tool, a test suite for governance proposals.  You can find more details on this specific grant and the work that Scopelift helped with here.

Community Analytics

One key area of focus that has seen quite a bit of activity is Unigrants Community Analytics.  This was an initiative that was originally funded in Wave 7 to the tune of $250K and was intended as a way to help produce analytics that educate the community and drive growth.  This program is overseen by a group of five individuals that are listed on their notion site (separate from the main UGP Notion.)

The high level on how this program works is that, typically, the top three submissions get $1500, $1000, and $500 respectively. A capped number of submissions receive participation prizes of $100 each. For "beginner" bounty, a single ‘best submission’ gets $500 (instead of top three), with a higher cap reserved for participation prizes. All prizes are disbursed in $UNI tokens.

There have been a total of 10 bounties rewarded to date, and two are currently open that focus on DEX Analysis and Gas price impacts.  Even with the price depreciation of $UNI, the Community Analytics program still has about a $100k budget (in $UNI tokens), and thus will not need a new funding extension just yet.  In talking with the UGP team, it sounds like they are hopeful the program can continue past the initial funding allocation as it has been a great way to engage the community around shared objectives that focus on providing better visibility and insights.

DeFi Education Fund

Another Uniswap that received quite a bit of attention was the DeFi Education fund (DEF).  It is important to note that this is completely separate from UGP and was voted on as a standalone initiative.  Still, I thought it was important to touch on this a bit  and provide some context (and ensure everyone realizes it is separate from the work being done with UGP.)

If you are not familiar with the history of DEF, it was an initiative voted on in this Governance Proposal, where 1M $UNI that was given to a 501(c)(4) nonprofit entity based in the United States would provide grants for political, educational, and legal engagement.  The vote closed on June 29, 2021 with ~79M UNI voting in favor and ~15M  voting against.

The amount given was put into question by many in the community, especially after the fund decided to sell off half of their allocation to sustain operations and fund strategic initiatives.  There was quite a bit of back and forth going on between different community members after the initial vote and the subsequent sell off.

In my research on DEF, it seems they have been fairly transparent in regards to their focus and how the money is being allocated to support stated objectives and initiatives.  You can find a list of their grant recipients on DEF’s website, along with allocation info on their Medium (which they are transitioning away from) as well as their Substack.

If there is enough interest from the community I could look at digging on this topic  a bit more in a future article, and would be happy to engage with DEF  if they would be interested.  For the sake of keeping the focus on UGP (which again, DEF is outside the purview of) I’ll be moving on.

UGP: Governance

Governance is described in the initial governance proposal in the following way:

• Of 6 committee members: 1 lead and 5 reviewers

• Each committee has a term of 2 quarters (6 months) after which the program needs to be renewed by UNI governance

• Committee functions as a 4 of 6 multi-sig

The initial committee had quite a few names that those familiar with our space would recognize, including Robert Leshner (Compound), Kain Warwick (Synthetix), Monet Supply (MakerDAO), Jesse Walden (Variant Fund) and Ashleigh Schap (Uniswap).  Another name that might not be as well known - but should be -is Kenneth Ng.

Ken has been a driving force behind many of the early grant programs and initiatives for the Ethereum Foundation, and someone I personally respect quite a bit as  someone who brought his experience from working in the traditional world of grants, including nonprofit and biomedical research.  Ken was named as the program lead with other members acting in more of a reviewer capacity.  If you are boring (like me!) and enjoy reading through governance posts you can find some really interesting nuggets of wisdom from Ken on his vision for this program, including structure for treasury management, reviewer compensation, and governance.

The committee saw some changes in July of 2021 with Robert, Kain and Ashleigh stepping down due to time constraints.  They were replaced by John Palmer, Ariana Fowler, and Callil Capuozzo, with Ken still acting as the program lead.  With those changes enacted in July of 2021, this is what the makeup of the committee looks like today (Twitter profiles linked for those I could find):

• Ken Ng

• Jesse Walden

• Monet Supply

• John Palmer

• Ariana Fowler

• Callil Capuozzo

Updates to UGP Governance Over Time

You can see which proposals have been submitted for on-chain governance here.  Since the initial 0.1 proposal, there have been only two proposals passed relating to governance function changes (here and here).

The first of these reduced the proposal submission threshold from 10M $UNI to 2.5M $UNI while keeping the quorum requirement static at 40M votes.  The community discussions  about reducing the amount started in September of 2020 with this in-depth analysis that you can check out if you are into that kind of thing.

The second proposal focused on an upgrade of the core governance contract to Compound’s Governor Bravo from the original Governor Alpha model.  Monet Supply wrote a great article that goes into  the finer details of this upgrade - or, for the TL;DR, you can just check out the image below (also from that blog post.)

Personal Assessment

I’ll take a bit of time here as we wind this article to a close to give my own personal assessment on the program across a few different areas.  These are just thoughts from some guy named Sov so take them for what they are worth.  Hopefully I have provided enough information (or at least starting points) in the article for you to draw some of your own conclusions as well.

Program Structure

It is apparent that the overall structure and program mechanics were well thought out from the start.  UGP was an early grants program (relatively speaking) for our space and seemed to follow some of the best practices and lessons learned from both the Ethereum Foundation (thanks to Ken’s influence) and more traditional grants programs with roots outside of crypto.

Stewardship of Funds

It does seem like Uniswap had well-defined objectives in terms of where the money was to be spent and how that related back to building the ecosystem and maintaining the protocol.  In some places, it appears that quite a bit of funding was given and you do have to dig  a bit to find the finer details, as these aren’t necessarily directly linked to the grant awards in the Notion Site (as with the Other Internet site not being directly linked to their grant).  As you dig deeper you can find quite a bit of effort and thought going into these programs, and I would think that’s  something that UGP would want to celebrate and share - perhaps a bit more than I found them to do.

I was also surprised to see some of the amounts given for sponsorships, including $108K to Bankless (3 grants) and $225K to the eSports group Team Secret (2 grants) that was mentioned above.  While I get that you have to pay to play  in the attention economy, it still seemed to me like quite a bit of coin (or $UNI) relative to other, more aligned sponsorship opportunities like Hackathons that probably had more impact on growing the Uniswap Protocol and its community, where less funding overall was received.

Finding the Information

I found the UGP contact I was able to work with very accommodating and responsive in helping answer my questions.  I was able to work with yj (@uniyj1) after being connected in the Uniswap Discord and they were very helpful in providing me with detailed information you can find throughout this article.  Aside from working directly with UGP team members, I found their Notion site, Twitter, and blog articles had almost all the information, even if I had to search here and there to connect the dots or find  the finer details.

How to Apply

You can apply at their site linked below or hop into the Uniswap Community Discord and look for the #uni-grants channel if you have questions.

https://airtable.com/shrWrSFRs6t1q1s9v

Closing

That’s all for now anons.  I hope that this piece was informative and helped provide some perspective on the program.  Please stay tuned for more of these kinds of research pieces and please follow me on Twitter and check out my blog, Sovereign Signal if you found this by some other means.

- Sov

Fantom: Grants and Incentives Programs

Hello again.

I have had quite a few new subscribers to the newsletter since my last post on NEAR.  It’s great to see all of you and I hope you will stay awhile.

Today we’re going to take a look at the Fantom Ecosystem and their grants and incentives programs.  I did a quick review on their 370M FTM Incentives Program for my introduction piece, The Common Good, but Fantom has a few programs in the mix including both legacy and newly revamped grants program in addition to their liquidity incentives so I thought it would be good to circle back with a more complete review of the programs and performance to date.

Early Grants Programs

For starters let’s take a look at Fantom Foundation and cover a bit of their history and how the grants programs got started.

I did some digging in a few places and found that Fantom Foundation Grants actually have their roots in a partnership done with University of Sydney way back in December of 2018.  That partnership looked to focus in on these four key areas of development across the ecosystem:

• Programming methodology for smart contracts

• Programming language for smart contracts

• Verifying compiler

• Virtual machine

If you look back into the history of other similar foundations in our space many started with educational partnerships and eventually evolved as their market cap (and foundation treasury) grew.  This is a bit of a natural cycle as cryptocurrencies and interest in developing these networks of value grew from tinkerers and technologists to the other side of the chasm with attention gaining from the early majority.

I wasn’t able to find a ton of information on how successful this program was as recipients and such were not publicly announced and the approach of partnering with educational institutions was closed in favor of ecosystem specific grants via the Fantom Foundation.  I think the growth of Fantom from 2018 to now is probably testament enough to the success of their early efforts.

Enough ancient history, let’s now take a look at the Fantom Foundation and their native grants and incentives programs.

According to CrunchBase, Fantom Foundation has less than 50 employees working for them across the globe.  The organization was founded in 2018 by Dr. Ahn Byung Ik, and the Foundation's current CEO is Michael Kong.

I wrote a bit about the Fantom Foundation in one of my earlier pieces, Fantom Powered, back when the market was more kind to anons than it has been as of late.  This article predates my research and gives a quick overview of Fantom and some of the projects (a few of which received grant and incentive funding.)

Fantom Foundation was created to steward the development of the Fantom Blockchain (known as Opera) and foster an open ecosystem of developers and partners that could build towards their ultimate goal of solving the Blockchain Trilemma. For some background on the Blockchain Trilemma and more technical information on Fantom you can check out the FAQ section of their site.  Messari and Nansen also have some really good information that do a better job of explaining it than I ever could.

Ecosystem Funds

Since the establishment of Fantom Foundation and their grants and incentives programs there have been three major ecosystem funds announced.  We’ll take a look at each of them and review based on details I was able to find.

Grants Program (Legacy)

First up, their initial grants program was launched in late 2020 and ended up awarding 9 projects total.  No totals in amounts given were publicly available anywhere I could find.

You can find some of Fantom’s more well known projects as recipients including Spooky, Spirit, APY.Vision and ZooCoin (a personal favorite of Sov’s for charting on FTM) on the list of recipients.

Another notable mention was Coordinape as they stood out a bit in terms of what they do (allowing decentralized teams and DAO’s without top down management or HR to autonomously allocate and reward funds to contributors) in comparison to the mostly DEX or Analytics projects in the crowd.

You can find all the information on this topic on this card at my notion site.  Next up let’s take a look at the 370M FTM Incentives Program that was launched.

370M Incentives Program

First, let’s start with some definitions as I think these things get a bit muddied in crypto.  Many of the programs across the space interchange the terms “grant” and “incentives program” but there’s an important difference.

Definition: Grants are defined as “an award, usually financial, given by one entity to an individual or an organization to facilitate a goal or incentivize performance. Grants are essentially gifts that do not have to be paid back, under most conditions. In the crypto space these grants can be for a variety of purposes, some of which might serve The Common Good.

Definition: Incentive programs are defined as any collection of funds that are awarded based on development of new ecosystem projects, current project ports, or weighted performance (usually measured by TVL).

An example of this is found within the incentives program for Fantom as it rewards projects based on their time-weighted average TVL.  This metric was measured using DefiLlama and paid out monthly based on performance.  I have been in contact with Fantom for the last few months and they have honestly been really responsive and helpful in my research.  I was provided a .CSV file with totals shown below:

In total more than 100 applications came in for the program and over 35M+ FTM was paid across 26 projects total.

Again, like with the grants program before, you can find Fantom’s well known DeFi projects in the list as recipients.  Curve was incentivized to port over and more native Fantom projects like Spooky, Spirit and Geist were rewarded for those heavy TVL’s they have seen since mid last year.

I found interesting the growth in RenVM.  It has gone from a smaller player to seeing 500K+ in rewards for February.  Tomb, Spooky and Spirit have all seen similar strength in the latter half of funding (through Feb is all data I have currently available).

The development of incentive programs like this in crypto is interesting because you can measure performance in terms of on-chain activity and then programmatically reward projects and contributors based on predefined metrics.  This is an interesting option when compared to traditional governance methods requiring some level of human intervention.

We’re starting to see a change in how funding can work for The Common Good, especially in some of the work Gitcoin is doing, but that’s a whole ‘nother conversation anon (that I will eventually try to write about).

335M Grants Program with Gitcoin

Fantom just announced this program at the end of Q1.  It is a partnership with Gitcoin that will allow all Fantom projects to apply for matched incentive rewards using Gitcoin’s Quadratic Funding mechanism.  Ultimately it will be Fantom’s users who decide on the allocations, with greater FTM matching rewards going to the projects that are most supported by the community.

The program states these three areas as it’s core focus:

• Better support a wider variety of project types

• Empower Fantom community in the allocation process

• Support smaller teams that are just getting started building on Fantom

To kick off this program Fantom will participate in the immediate next Gitcoin Grants round, scheduled in June, and the Fantom Foundation will match user donations up to 3M FTM in the first round with subsequent rounds receiving 1.5M FTM in matching funds.

It should be noted that with this program coming online Fantom is closing previously announced incentive programs mentioned above and asking pending applicants to apply for Gitcoin grants in the upcoming rounds.

Finding The Information

Overall the information I have above wasn’t too hard to find and the Fantom team was pretty accommodating in working with me directly to gather specifics.  If you watch their announcements channels and blog they do a pretty good job of keeping information current and available so I would say nice work and keep it up.

How to Apply

As mentioned above the only open program at this time is the 335M FTM Grants in partnership with Gitcoin.  If this is something you are interested in you’ll want to make sure you have a profile created on Gitcoin that is active and be watching for updates on the next funding round that takes place in June.

Closing

We’re at the end here, anon.  Be back with more in the days to come.

Please make sure you are subscribed to my newsletter (if not already) and that you are following my work at the Notion Site I created where all of this research is tracked (linked below.)

www.thecommongood.xyz

- Sov

NEAR: Ecosystem Fund Review

Progress continues moving forward in documenting more and more of the Grants and Incentives Programs in the space.  I have made some nice strides (at least, I think) in building out my public database and starting conversations with a few more of the larger Ecosystem Funds that I will be reporting on in the days ahead.

This time we’re taking a look at NEAR with some analysis on their Ecosystem Fund that was announced in October of last year to the tune of $800M.  We’ll take a look at the current rate of distribution and highlight some of the projects that were granted.  We’ll also review a bit on how governance works and talk about where you can look to learn more about NEAR.

Let’s dive in…

Background

NEAR was founded back in 2017 by Illia polosukhin and Alexander Skidanov with a mission to develop a highly scalable network that could build upon previous innovations but take it one step further in terms of performance and overall scalability.

According to CBInsights they have raised ~$521M to date in funding including the most recent $350M that was announced just a few days ago.  Looking through the list of backers it reads like a who’s who of prominent traditional and crypto VC’s and that isn’t too surprising when you start to look under the hood of what NEAR is doing.

NEAR touts itself as a performant, highly efficient layer one network that uses sharding to achieve relatively high transactions per second (TPS).  It is a delegated proof of stake requiring validators to stake $NEAR to participate like many other POS networks.

NEAR’s secret sauce, Nightshade, is a dynamic re-sharding mechanism that allows the network to be readjusted based on utilization allowing for reduced cost of use while maintaining high TPS.  Total big brain stuff.

If you want to learn more about these kinds of details in addition to bridge options, network comparison and tokenomics you can check out the this post from the good folks at Nansen who will do a much better job of giving you that info than me.

Organizational Structure

NEAR describes its structure online as a collective, a foundation and a blockchain.  For the purposes of this research we are looking specifically at their foundation as that is the entity that is responsible for governance and oversight of their ecosystem fund and grants programs.

The NEAR Foundation was created in 2019 to help steward and develop the ecosystem that would start to form.  Reading through their documentation and site their vision seems well laid out.  I also appreciated the fact that they state their purpose, which is something that seems missing all so often in our highly transactional world of today:

“Our purpose is to enable community-driven innovation to benefit people around the world.”

We are seeing building support for the NEAR Ecosystem not only in the charts (number going up) but in recent funding rounds like the $350M that was just announced that included big names such as Tiger Global, FTX Ventures, Dragonfly Capital, and a few others.  I have the Twitter announcement linked here for some additional details if you are interested in checking it out.

Now that you have a bit of the background on NEAR including technology and their foundation let’s dive in a bit to their ecosystem fund and how things have been progressing since their initial announcement in October of 2021.

Ecosystem Fund

Overview

NEAR’s founder Illia polosukhin announced their ecosystem fund at their conference (NEARCON) back in October of 2021 to the tune of $800M in total incentives available to anons that want to help build out the ecosystem.

If you take a look around on NEAR’s wiki you can find some details on the grants program. At a high level it states these three main objectives:

• Provide funding to accelerate the growth of the NEAR ecosystem and broader community

• Support the development of necessary and value add infrastructure / tooling to support continued innovation

• Attract and reward a diverse set of open source driven projects and developers that build on NEAR

The program is structured to allow for funding across these four main categories.

• Open Source & Public Goods (yay!!)

• Startups

• Education Initiatives

• Bounty Awarding Initiatives

Aside from the NEAR Foundation there are also funds available through these sources all with additional details on the site mentioned above. I wasn’t able to find any details or lists of projects or initiatives funded through these entities that were directly tied to NEAR so you’re on your own there, anon.

• NEAR Community Fund

• Open Web Collective Fund

• NEAR Asia Fund

• Cypherpunk Guild

• DAO Ecosystem

Distributions

The incentives for these programs are paid out in $NEAR, but accounted for on a $USD cost basis, meaning recipients would be granted an amount equivalent to $NEAR based on current market price at time of allocation. It will be interesting to see if this changes and they start to use their newly announced stable, $USN, to provide funding moving forward.

Unfortunately, not all the allocation consumption totals for the program are not publicly available like others I have reviewed,  however, I was provided a link to a public Notion site where you can view the name of the grant recipients who have publicly announced along with some other relevant details:

Projects Granted by NEAR/Aurora

The current process for fund governance is driven by NEAR Foundation and explained to me to have a due diligence and evaluation process prior to allocation.

Funds are distributed on a milestone basis once agreed upon goals for project success are met or progressed.  The success criteria for each of these differs between the projects and would be at the discretion of decision makers at NEAR Foundation to define and ensure alignment to overall ecosystem goals and objectives.

The address where it was indicated to me that these funds are paid from is located below:

https://explorer.near.org/accounts/nf-payments.near

It should also be noted that prior to the $800M ecosystem fund announcement, NEAR had already spent $45M across more than 120 projects, including Core Protocol Infrastructure Grants.

Funding Breakdown

As mentioned not all the allocation consumption totals for the program are public so only partial information is available.  At time of writing there were 85 total grants listed with 16 of them showing funding totals that amounted to ~$845K.

The amounts granted range from low 5 digits all the up to $150K but I have to believe some higher amounts have been given out under the $800M allocated for the program.  I have a snapshot below of the projects where funding amounts are available.  You can see the entire list on my notion site if that kind of thing excites you.

Keep in mind that NEAR doesn’t list the total amounts for all projects so the monetary totals listed only take into account projects where funding totals were public.

NEAR is breaking up their funding allocations into a few different categories based on the Notion page that I shared above.  I took some time to sum a bit of the information in their site and have below a breakdown of these categories and current totals.

Keep in mind that NEAR doesn’t list the total amounts for all projects so the monetary totals listed only take into account projects where funding totals were public.

NEAR seems to be investing the most in building the core infrastructure and investing in DEX’s, yield aggregation, and NFT’s which makes alot of sense as you create a foundation (pun intended) for long term growth and sustainability.

I also really enjoyed this thread on some of the more promising projects in the ecosystem that I think is worth checking out if you want to dive a bit deeper on that front.

Finding The Information

I will say I was very pleased with the help I received from the NEAR Team. I asked some questions in the Discord and quickly found my way to someone that was willing and able to help. One of the most enjoyable parts of this entire project I underestimated was meeting anons that are contributing and stewarding these systems. If I had to give any suggestions it would be to be more detailed with the data available and to have some kind of trail linked to the notion site that shows the approval process. I would also recommend some kind of success metrics that these grants are tied back to that can be measurable over time.

How to Apply

If you might be interested in applying you can hit the links below for more details.  If questions arise during that process make sure to check out the Discord and they can help.

• Open Source & Public Goods (yay!!)

• Startups

• Education Initiatives

• Bounty Awarding Initiatives

Closing

Progress has been picking up and I feel I am hitting a stride (famous last words, I am sure) in building out my my research site, The Common Good. I even got a RT and follow from the legendary Gabagool.Ξth after sharing my site on the this post … won’t lie totally made my day.

The research will continue with a few more funds in the hopper that I hope to publish in the coming weeks. Thanks to all of you for the support!

Until next time frens,

- Sov

In this article I will dive a bit into my work thus far, lessons learned from the road and a view into The Harmony Foundation and their corresponding ecosystem fund and grants programs.

Background

Harmony is an open and fast blockchain built using the Ethereum Virtual Machine (EVM) compute model.  It touts super fast transactions along with low transaction costs relative to some other chains.

In addition to the base protocol layer Harmony also touts themselves as a strong Layer 2 scaling on Ethereum.  This is becoming a bit of a crowded space as more and more projects vie for a juicy piece of the pie that is the white hot decentralized finance ecosystem. Harmony can connect with Proof-of-Work and Proof-of-Stake chains. Their FlyClient architecture touts being fully trustless and efficient with gas compared to other solutions.

You can find a pretty extensive write up on Harmony that was done in Oct ‘21 by Rasheed Saleuddin from Messari that will give you far more information than I can provide here if you want to dive deeper into those kinds of details.

For the purposes of this article let’s move on to the main event and my review of the Ecosystem Fund and their incentive program.

Ecosystem Fund

Harmony seems to be $ONE of the more mature ecosystem funds I have encountered in terms of its structure, transparency and overall community engagement since starting my research.

Harmony announced their $300M+ ecosystem fund back in September of 2021 (seems like so long ago, I know anon) with a really well done Notion Site explaining the program structure, areas of focus and how to participate.  Their CEO, Stephen Tse, discusses his vision for the program a bit in the thread below:

The Notion Site is a bit dated and hasn’t been updated much since the initial launch but you can see quite a bit of activity in the Harmony Forums related to governance and funding of proposals.

At its core the ecosystem program is focused on driving investment across 7 key areas with specific amounts and allocation quantities assigned to each.  The program has high weighted funding for the first year of ~$180M and then looks to sustain with ~$200M from treasury reserves for years 2-4 for a total of ~$380M allocated to be distributed over a four year time span.

In terms of governance the foundation has established some guidelines based on the chosen track a would be sovereign individual may want to take.  Per the response I received from my post on their forum this is how governance works today for the program:

“Provided the proposal meets the criteria, the proposal is then reviewed by a grants committee. The committee is made up of Harmony core team members and community contributors. The committee also relies on feedback from the broader community who can participate from the Harmony public forum, where proposals are posted.”

This process will be further decentralized shortly via the Launch DAO, moving the governance over to the community.”

Funding from the ecosystem program is paid out via $ONE with funds being sent from the Harmony Foundation’s wallet to the grantee’s multisig wallet. Having a 5 out of 9 multisig wallet is a requirement for funds to be distributed and all transaction details are posted on the proposal post publicly. You can check the recipients, amounts and stage of the process the funding proposal is in at an Airtable site that Harmony shares out. I found it an interesting document to explore, some brief observations:

Funding Breakdown

As of writing close to $37M of the $300M+ fund has been approved or funded. Here’s a snapshot for you of the top projects that all have either been approved or funded for $1M or more:

The projects are divided up into these categories (definitions linked below.) I took some time to break down the numbers a bit on each as well to give you an idea of what they are looking like across the categories at time of writing:

• Ports

  • 18 Projects for ~$1.7M

  • MAI and Synapse (a personal fav of Sov’s) plus Warena funded for top spots with $250K each.

  • Average of ~$94K per project with some in the $10-$20K range for funding. All sitting in approved or funded status.

• Investments

  • 31 investments at ~$7.75M total in funding

  • Harmony/StakeDAO and Project X at EthDenver showing for $1M. Not sure why these wouldn’t fall into partnerships/launch or hackathon.

  • Average of ~$250K per project with some on lower end in the $10K-$25K range.

• Launches

  • The largest category by a wide margin. 130 proposals for a whopping
    ~$13.2M in funding.

  • AAVE taking home top spot for their launch on Harmony. $5M committed and sitting in approved status.

  • Curve taking down an honorable 2nd spot with $2M in funding for their launch on Harmony.

  • Outside the top two all others were ~$100K or less. Average size was $101K and all of them sitting in various stages of approval and review.

• DAOs

  • 38 DAO proposals for a total of ~$6.2M

  • Blu3, Sustainable Development DAO, and zkDAO taking down $1M

  • Average of ~$178K per with some on the lower end hitting $35-$50K. All but a few sitting in funded status.

• Hackathons

  • 6 Hackathons for $360K funded

  • Dystopia Labs took the top spot for $250K

  • Average ~$60K spent per hackathon. All in approved or funded status.

• Partners

  • 15 Partners funded for ~$6.5M

  • Bringing Abracadabra Money into Harmony took the top spot with $2M in funding back in NOV ‘21 (again, seems like so long ago.)

  • Poolz and an interesting approval to fund their incubator projects came in with $2M.

  • Everyone’s favorite DFK was in the mix with a cool $1M

  • Average across the 15 was ~$466K with some on the lower end receiving $50K-$100K in funding. All in approved or funded status.

• Bounty

  • 21 Projects funded for ~$777K

  • Top spot goes to Harmony<>Cosmos Bridge in taking down $95K. This project focuses on building a bridge between Harmony and Tendermint based ledgers using the IBC. Probably nothing.

  • Amounts varied pretty widely across the bounties. Average was around ~$37K with all of them in approved status.

• Events

  • 17 Events for ~$323K

  • Most events seem to be happening in 2022 with more than half happening in just the last month.

  • All events in approved/funded status

  • Most events were $12K or less. ETHRio/World Summit/DreamerDAO all approved for $50K. Also a developer bootcamp in Sierra Leone with Princess Sarah Culberson that was an interesting find.

• Project Y (no definition)

  • 7 Projects total for $60K

  • All in Approved Status (recently approved - 3/28/22)

  • All requests seem to be for the same amount - $10K

I will mention I did find a few in the mix that seemed to me incorrectly categorized so just keep in mind that the totals I list below is purely based on the categories that are listed in the sheet, just keeping it real with ya fam.

I also took a bit of of time to break down the category amounts in Notion and posted them to my site, The Common Good, where all of my research related to this project is being kept. You can see below the totals and how the foundation is currently tracking against the original goals that were established (pictured above from their Harmony Notion Site) when the ecosystem fund launched:

Finding The Information

I did have to do some digging to find this information and bounced around a little bit between their main Telegram and Discord before being directed to join a Grants Telegram Group that is focused on answering questions and helping with any questions on the process.  All in all I found the Harmony Community Team very accommodating in answering questions and genuinely trying to help. 

As I move forward with my research I think it will be important I document not just the metrics themselves but how open and transparent the different funds are. From my perspective, Harmony did a good job here and they pretty transparent system for tracking the information if you are a guy like me that obviously needs better hobbies.

How to Apply

If you might be interested in applying you can hit the tweet below for more details.  If questions arise during that process make sure to check out the Telegram Channel I mentioned earlier and they can help.

The Road Ahead 🛣️

As I started my research I started to review the list of incentives programs and grants in my compendium that have been gathered over time and build a backlog of those that I would like to learn more about on The Common Good site that I set up.  

In this list there were a few major incentive programs that jumped out at me as they had advertised pretty large sums upon the launch of the program (circa ‘21 and early ‘22) so I naturally thought finding information regarding these would be a bit easier than I ended up encountering.  I won’t name these programs that continue evading my simple questions (for now) but I have to say it’s a bit concerning that you are advertising 9 figure sums of money to grow your little slice of heaven yet don’t really want to provide much details on the governance, distribution or overall oversight of these funds.

I will do the best I can to eventually find metrics to report. Just don’t be surprised if some of the ecosystem programs you would think I should be evaluating don’t appear here anytime soon…

With that being said, I am gathering information from a couple more funds and will be back in the days ahead with another update from the road to share what I have learned.

You can always check out my research as I compile it at The Common Good or head by Sov’s Compendium anytime you are in need of information sauces, useful tools and research that might help on your journey towards sovereignty.

- Sov

My background in the non profit space and recent experiences with grants in the traditional sense got me thinking on how I would like to learn more about this topic from the crypto perspective. Like many of you I have been seeing one announcement after another over the last year around “Ecosystem Funds” and was curious as to how these programs work in comparison to some of the programs I have had personal experience with. Many of these Ecosystem Funds are backed by VC’s or other for-profit interests and, upon first glance, are a bit opaque in explaining how the funds will be managed and allocated so I thought this might be a great opportunity for me to learn a bit more on how they operate (and share my journey here).

I won’t lie. I think these funds and their movements could be a valuable source of alpha that would-be sovereign individuals could do better to educate themselves on.

Philanthropy: Origins 🌱️

First, I thought it might be interesting to look at a brief history on the origins of grants and philanthropy and what their original intent (at least outside the Metaverse) was. If history bores you probably best to skip ahead, anon.

A good definition can be found here:

The word "philanthropy" derives from the Ancient Greek phrase philanthropia, meaning "to love people." Today, the concept of philanthropy includes the act of voluntary giving by individuals or groups to promote the common good. It also refers to the formal practice of grant making by foundations to nonprofit organizations.

If you search around on the web for a history on topics like grants and philanthropy you will find a bunch of decades old PDF docs detailing the topic all from different points of view or on specific areas that grants were applied or used … super boring honestly. The site I find the most helpful to learn a little bit on the topic is from the National Philanthropic Trust as it has a visual timeline you can navigate on the site starting in the 16th century all the way to the present day. An interesting quote that greets you on the site I think sums it all up pretty well:

“Wealth is not new. Neither is charity. But the idea of using private wealth imaginatively, constructively, and systematically to attack the fundamental problems of mankind is new.”

- JOHN GARDNER

The more I looked into this topic the more I found parallels to crypto, especially in how the concept of philanthropy started to take hold in the 16th century. During this time of change and great progress for the individual, humanity saw the medieval world fading away including its economic, political, and social structures. For any of you anons that are familiar with The Sovereign Individual (one of my favorite books of all time) you will probably start to see some of the parallels to our world today as digital infrastructure lessens the returns to violence in the physical realm thereby diminishing the power of nation states and corporations.

I know I am hitting you with all kinds of quotes, apologies in advance, here’s another:

Globally, the Age of Discovery spurred an unprecedented exchange of people, goods, ideas, and culture. All of these changes had a profound effect on the rise of modern philanthropy, centralizing need in urban centers, changing who gave and who received, shifting the locus of giving from religious orders to the state, and enabling a global exchange of philanthropic acts and ideas.

Sound familiar? Well, history doesn’t repeat but I have heard that it can often rhyme.

I won’t bore you with all the details but I will close this section by saying the theme I continued to see over centuries when looking into the topic was this: technology and innovation created new opportunities and with that some that benefited decided they would help those that were being left behind in the process.

As the trend (and our society) became more global in nature over the years the divide has only increased and the need for innovative solutions to help contribute to “The Common Good” are needed now more than ever.

“Nothing vast enters the life of mortals without a curse.”
― Sophocles

So what does this concept mean? Well, in the traditional sense it can be described as:

In ordinary political discourse, the “common good” refers to those facilities—whether material, cultural or institutional—that the members of a community provide to all members in order to fulfill a relational obligation they all have to care for certain interests that they have in common.

In the Metaverse (I think that’s the appropriate term currently for crypto?) we don’t have a centralized governing body (yay!) so that means there’s no Big Brother handing out grants like we see with Nation States and levels of local government underneath. Because of this, the majority of funding is not coming through government entities and instead are made available through foundations, Ethereum Foundation being one of the most notable, or directly through projects like with Uniswap Grants (which ironically enough is a stellar example of success from the Ethereum Foundation Grant Program). Aside from these you are also seeing some interesting new approaches to funding including quadratic funding mechanisms, like GitCoin, and some other interesting approaches including DAO Treasuries starting to enter the arena and offer their own programs.

The criteria for these grants varies widely based on who is offering (and their agenda/where their money comes from) and I was very surprised that there is not a great centralized place where you can track grants other than visiting all of the different websites. The best list I have found is from some guy named Sov and it’s pretty bad and tracking proactively where the money is flowing and who’s in the pipeline for approval is even more challenging than just finding where to go for information.

You also don’t have to look very far to see things that make you start to wonder who is actually making the decisions on how many of these funds are allocated. A very visible example of this is the $20M that Uniswap gave for their “DeFi Education Fund”

Examples like the above make you wonder how much progress we are actually making towards “The Common Good” here in The Metaverse. While we sometimes like to throw stones at governments and “centralized” entities and talk nonstop about how we’re going to change the world with our promise of decentralization the honest truth of the matter is that those “centralized” entities have contributed much more, thus far, to advancing the common good than any of our well meaning dApps. Additionally, much of the funding and growth evidenced in “grants” across the crypto space relate to building of new projects or protocols that don't necessarily help increase equity or access but more perpetuate the current mode of speculation and competition present today.

My hope is that we can figure out a better way to leverage programs like these Ecosystem Funds to address the challenges of access that exist outside our corner of the Metaverse. Don’t get me wrong, there are some great projects that are starting to form and make a real difference and that’s exciting to see happening. We can’t make crypto's answer to philanthropy and the common good “donate with crypto” as that is very much selling ourselves short on what we can actually accomplish. This thread from Vitalik years from the last cycle might be a good reminder of how far we have come (mostly in TVL) and how far we have yet to go…

Next Steps 🔍️

So, where do I take it from here?

Well. Given the amounts on these ecosystem funds and grant programs can be enormous and the details are a bit scattered I thought I would take a first pass at trying to compile some information on the current landscape including:

• What are the most prominent Ecosystem Funds that have been announced to date?

• How are each of these funds being governed?

• What kinds of projects (if any) are they funding currently?

• How much of the allocated funding has been used or consumed to date?

• Are any of the projects or initiatives contributing in some way to developing public goods that, in some way, benefit “The Common Good”?

I’ve started up a Notion site that you can reach at the link below where I will be keeping track of my research and building information over time. I haven’t found many places where this information is tracked today so thought I would chip in and start to build something in addition to writing for my blog.

Keep in mind it’s totally a work in progress and pretty sparse at this point but I will be building it out over time into something that is (hopefully!) useful.

With that disclaimer, here it is:

www.thecommongood.xyz

A Strong Foundation 🏗️

We have seen some huge numbers announced in terms of liquidity incentives from foundations for developers to build on their respective L1’s/L2’s. This has led to a hyper competitive environment for developers and massive upside for those that can bring successful products to market. I’m going to start by taking a look at one of the more notable ecosystem funds that were announced last year: Fantom!

Fantom Foundation

Fantom announced their liquidity incentives back in Aug ‘21 with a committed total of 370,000,000 $FTM to the cause. Depending on the day and market conditions the value of that can change so check out CoinGecko and do the math if you want on how much that actually is.

This program is not considered a community grants program as it is fully programmatic in how the rewards are paid so there is no decision making by the Fantom Foundation meaning if projects meet the requirements then they receive the incentives. The requirements only apply to TVL of $FTM locked in projects on the Fantom network and have nothing to do with project focus or goals.

I was able to reach out to Fantom Foundation and get an update on the status of the program and incentives distributed to date that I have below:

Fantom does have a community grants program that is governed by the Fantom Foundation but it seems to have lost a bit of steam since the announcement of the incentives program. This article mentions a few grant recipients (some nice projects in here) and on their site they also mention here the grants program is “ongoing”. When I reached out to the team via email to check on the status of the program I was told:

“For the grants, we do give grants to selected projects, mostly infrastructure builders. Grants can go from 5k to 100k, but they're very rare and selected.”

While Fantom seems to have some nice incentives and a working grants program I didn’t really see any projects that are actively contributing to the common good by producing a commodity or service that is provided without profit to all participants of the network. The closest I was able to find to this would be examples like CryptoKek, ZooCoin, and Millennial Finance (all of which received grants from Fantom) as they offer some sort of base level “free” service in the form of charting, data analytics and portfolio tools. I wouldn’t fully consider any of them a public good per se as they all have a native token model and, in some cases, gate access to different tiers of their product based on users holding those tokens. Outside of these few examples, it seems everything else receiving incentives or grants is in large part decentralized exchanges (thanks to the focus on TVL metrics) and then a grant for Coordinape.

Closing

Thanks for tuning in and hope that you found this info valuable. More to come in terms of research into this topic so please stay tuned anon! If you have questions or comments please hit me up on Twitter!

- Sov