DAO Drops: A retroactive public goods funding that directly empowers Ethereum users

Public Good Projects Discussion
1

DAODropsMark

Project Name:

DAO Drops - https://daodrops.io/

Project Description and why it’s classified as a Public Good:

DAO Drops is the public goods arm of dOrg, an OG services DAO that builds dApps and other web3 infrastructure. The aim of DAO Drops is to Drop open source tools for decentralized communities.

In 2023 we launched DAO Drops first iteration, a pilot supported by the Ethereum Foundation to empower Ethereum users to allocate ecosystem funds to underfunded projects. If you want to know more about how we built this first drop, visit https://daodrops.io/

We received a tremendous amount of positive feedback from the community, especially from groups that were interested in running their own rounds. As a result, we released our second drop: PairDrop. PairDrop is a reusable primitive that allows communities to intelligently allocate funds. It is designed to avoid common pitfalls of funding mechanisms like cognitive overload and favoritism, while making the process fun and painless.

Our upcoming public goods tools drops include a privacy-preserving DAO, a bot for public goods projects to answer common questions, assist with DAO onboarding, and help write grants based on past applications, and a forkable version of dOrg Passport to manage builder reputation and Snapshot voting.

The value we aim to add to the public goods ecosystem includes creating reusable, useful and intelligent tools, fostering innovation and community empowerment, and continuously developing scalable and transparent mechanisms for decentralized communities.

What public goods tools would you like to see DAO Drops develop next? Share your ideas with us at daodrops@dorg.tech, DM us on Twitter, or message us in the Octant forum. We’d love to hear from you!

Main Project Funding Sources:

DAO Drops Round 1 was possible thanks to a grant from The Ethereum Foundation. Allocation Update: Q1 and Q2 2022 | Ethereum Foundation Blog

Seeking project-specific funding or funding for general operations:

Both: We are seeking funds for the grants pool as well as funds for operations for the team to improve the mechanisms and execute the rounds.

Project Roadmap and Milestones (only for project-specific funding):

Here is our roadmap for Round 2, including details about how we plan to iterate DAO Drops over time to experiment and improve our mechanisms and interoperability with other RPGF programs.

Design & Implementation:

  • Create tech stack and new scoring algorithm.
  • Improve curation, voting, and mechanisms.
  • Streamline KYC and enhance UI.

Execution

  • Nominate and validate candidates.
  • Evaluate and vote.
  • Distribute funds.

Round 2 Survey & Blog Post

  • Measure success.
  • Share results.
  • Next Steps
  • Plan for future rounds

For nominees’ outreach we are further emphasizing reaching out to and elevating the influence of under visible areas of the ecosystem, including contributors in the Global South. We plan to evolve DAO Drops into a continuously running funds distribution mechanism.

Funding Request and Budget (only for project-specific funding):

$1m+

Team Information, including backgrounds and roles:

DAO Drops team for Round 2

Social Credibility (development progress, awards, notable GitHub commits, referrals):

Since the project was launched, we’ve been featured in different podcasts, newsletters, twitter accounts and articles, here’s a few:

Features:

If you want to keep diving into our social credibility, please take a look at our Twitter account: x.com and feel free to explore the full use case of how we built DAO Drops Round 1: https://www.dorg.tech/#/case-studies/dao-drops

Discord contact:

  • Magenta: magemagenta
  • Ori: orishim

Eligibility Criteria

Do you have a commitment to open-source (i.e. every open-source license accepted by the Open-Source Initiative) technology and sharing results publicly?

Yes. Our Github repository is open source and visible here: GitHub - dOrgTech/DAO-Drops: Full stack MERN app for the DAO Drops Project Round 1 results are here (as of 10/19/2023), https://daodrops.io/. When we switch to Round 2, the previous results will be publicly archived.

Have you provided transparency about how exactly funding will be used?

Absolutely! We’re committed to full transparency. Starting in Round 1, we provided a clear overview of how DAO Drops operates:

Nomination Phase: During this stage, anyone in the Ethereum community can submit information about projects or individuals they believe deserve funding. The eligibility of these nominees is then determined, allowing them to proceed to the allocation phase.

Allocation Phase: Here, Ethereum users play a pivotal role in deciding which nominees receive funding. Voting power was calculated based on their past on-chain activity. A total of $250,000 DAI was distributed to nominees in proportion to the votes they accumulated.

Voting power was allocated based on three primary types of on-chain activities, with a maximum of 100 points available per address in each category. These activities included:

  • DAO Participation, fueled by Deep DAO.
  • Ecosystem Event Attendance, supported by POAP.
  • Smart Contract Deployments, powered by Galxe.

Round 1 voting addresses are listed on our Github at DAO-Drops/scripts/scoreSheets at main · dOrgTech/DAO-Drops · GitHub. We remain committed to enhancing transparency and refining our processes in each subsequent round.

Are you advancing values of freedom and privacy (no surveillance and handling of personal data)?

DAO Drops embodies these values by creating a system that offers more control and privacy to Ethereum users, ultimately advancing the principles of freedom and privacy within the community by letting them choose how to distribute the funds without needing to reveal any personally identifiable information.

Are you supporting decentralization in various fields (for example building Web3 projects)?

Here’s how DAO Drops contributes to decentralization in various fields:

Community-Driven Fund Allocation: DAO Drops allows anyone from the Ethereum community to nominate projects and individuals for funding. This decentralized approach ensures that the decision-making process is not controlled by a single entity or organization, promoting decentralization in allocating funds.

Transparent and Inclusive Voting: Ethereum users participate in the allocation phase by voting on the nominated projects. Voting power is calculated based on past on-chain activity, promoting transparency and inclusivity. This decentralized voting process ensures that a diverse range of community members has a say in funding decisions.

Emphasis on Open-Source Principles: DAO Drops is an open-source initiative. Its code and operations are visible to all, promoting a decentralized ethos of open collaboration. GitHub - dOrgTech/DAO-Drops: Full stack MERN app for the DAO Drops Project

Targeting Overlooked Areas: By involving a diverse range of ecosystem participants, DAO Drops can effectively target areas often overlooked by centralized allocation bodies as well as those left behind by popularity contest dynamics. This commitment to supporting underserved areas within the Ethereum ecosystem contributes to decentralization by spreading resources more equitably.

Have you provided social media channels to the extent that we can confirm social proof of your project?

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Hello everyone, this post is to share our latest updates!

1. What you’ve worked on in recent months and what do you have coming up (e.g. goals/plans).

The DAO Drops team has been focused on shipping our newest public goods funding primitive, a decentralized capital allocation mechanism that allows a community to engage in co-budgeting of a set of funds, distributing money to projects that best meet the community’s goals. The mechanism leverages random sampling and pairwise comparison to enable large sets of voters to allocate funds across impactful projects while avoiding popularity contests.

We have completed the designs, algorithm implementation and started the backend build. Next up we will be developing the frontend, creating documentation, publishing and promoting the primitive for use amongst different crypto ecosystems.

We have also developed a reusable address scoring script to allocate voting power in a sybil-resistant manner. The script checks a wide array of on-chain data sources to assign different voting weights to hundreds of thousands of addresses.

It is designed to distribute power across a diversity of knowledgeable individuals in the EVM ecosystem, including developers, event attendees, governance participants, dapp users, public goods donors and more!

2. What you’re spending the received funding on and what you’re planning to spend potential future funding on.

The funding to date has been spent on research, design, and development efforts for the pairwise primitive and address scoring script described above. The funding will also be spent on related operational expenses to launch the primitive, such as user testing and promotion of the primitive.

We plan to allocate future funding towards developing and releasing future public goods funding primitives, that enable communities to pool and allocate funding intelligently and sustainably.

3. Did you receive any other sources of grant funding since the previous Octant epoch? For example, RetroPGF, Gitcoin, etc.? If so, please include how amounts of funding.

No.

4. Did you receive sources of non-grant funding for your project, such as user payments and donations, staking or LP providing treasury funds, VC funding, or others?

No.

5. Fundraising

In the future, we plan to apply to Gitcoin, RetroPGF and other public goods funding rounds.

6. Next steps/roadmap

We plan to do our second DAO Drop in February, and then begin development of the third drop. “Drops” are public goods funding primitives that we release in partnership with different ecosystems.

7. Community Support:

For any questions, feedback or if you want to get involved in any way, join the dOrg Discord or reach out at daodrops@dorg.tech.

We look forward to working closely with the Octant community to advance public goods funding tech for the whole ecosystem!

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Hey Octant community! Here are our latest updates:

1. Achievements since the last Octant Epoch

After months building this open-source community driven tool, we successfully launched PairDrop, a reusable primitive designed to help communities allocate funds intelligently. It sidesteps common pitfalls like cognitive overload, bias and favoritism while making the process fun and painless.

You can check more information about PairDrop here.

2. Upcoming milestones on your project roadmap

We plan to start developing our third drop: forkable DAO passport like what we build for ourselves at dOrg?, a privacy-preserving DAO, forkable V1 of DAO Drops with candy colors? If you’re fiending to have one of these please let us know!

“Drops” are public goods funding primitives that we release in partnership with different ecosystems.

3. How funds from the previous Epoch were utilized and plans for any funds raised from Epoch Two

The funds from Epoch Two have been spent on the research, design, and development efforts for PairDrop, which we released in February 2024! Remaining funds will be used for the next Drop.

One thing to note is that in this process, we identified that using Scouts for the curation process would be more effective at achieving geographic and topical diversity in nominations. Scouts are hand-selected, diverse representatives who would make project nominations that fit the goals of the round. Similar to other public goods funding rounds, we concluded that specific, targeted round are also more effective at funding specific areas of innovation.

We shared our learnings via Gitcoin’s EasyRetroPGF training.

4. Grant funding received since the last Epoch (e.g., RetroPGF, Gitcoin, etc.), including funding amounts

We have not received any other funding apart from what we got from Epoch 2. If you want to contribute to funding another round of the first DAO Drops or its improved kin, PairDrop, please do get in touch!

5. Other non-grant funding sources (like user payments, donations, staking or LP contributions to treasury, VC investments, etc.)

None.

For any questions, feedback or if you want to get involved in any way, reach out at daodrops@dorg.tech.

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Thanks for sharing @anitacaldera
I like the idea behind PairDrop, I wonder if it might be something we could implement into Octant if/when we get too many projects. But then we might run into issues where individuals don’t get to vote on the projects they like since they’re just getting a small sample size. Perhaps it could be a ‘Simple’ and ‘Advanced’ voting option. That’d solve that part. Anyway, very cool!

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Hey Mattias! That setting is indeed easy to customize.

This link drops you straight into the documentation of how to do it! :slight_smile:

Implementing PairDrop into Octant is absolutely something you can do and we would be very excited about!

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One of the reasons you might want to stay with a low-ish number of pairs is to reduce the “popularity contest” dynamic common in retroactive public goods funding, where those with the most active community and/or marketing power have an advantage. For example, marginalized projects or utility projects where builders are not loud on social media. Depends on your goals!

That was one of the goals of our research anyway, to give folks some more optionality with the mechanisms available to them for how to distribute available funds.

We’re here if you have any questions if you go ahead with implementing it or otherwise want to reach out! Thank you for making Octant and for making PairDrop possible!

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DAO Drops Update for Epoch 5:

  • Total Funds Received from Octant so far: $ / ETH - We have raised USD $107,760
  • Funds Spent: $ / ETH) We spent (USD $31,578) to build PairDrop.

Milestones and Deliverables

  • Milestone 1: PairDrop Project Initiation and Setup

Goal: build an adaptation of DAO Drops that uses pairwise comparison voting, as a forkable app.

Activities:

  • Meetings and syncs to define project scope, user flow sketching, and initial project setup. A goal here was to maintain the video game like, fun, simple UX of DAO Drops V1.

  • Setting up Next.js project structure, adding fonts, colors, and assets.

  • Implementing wallet connection, developing components and pages (Home, About, Explore, My Votes, Vote & Modals).

    • Immediate Outcome: Completed scope design, user flow, and initial project setup in Github.

    • Funding Used: $ [USD $5,718]

  • Milestone 2:

    • Description: Voting and DAO Drops Development, including Data Sources and Algorithm Development.

Activities:

  • Development of vote pages, results table, modals, count page, backend integration, and sign message authentication.

  • Enhancements including API caching, responsiveness updates, style improvements, and bug fixes.

  • Finalizing voting UI/UX, implementing WebGL performance enhancements, and incorporating Three.js ripple effects.

  • Researching data sources, developing data miners scripts, and testing data acquisition.

  • Implementing backend improvements, score normalization, and deploying MongoDB Atlas.

  • Development of pairwise algorithm, generation of new backend API, and code improvements.

    • Immediate Outcome: Data miners and data sources completed, to generate the on-chain voting history points that are used to calculate voting power. Data Sources include Gitcoin Project Owners, Mirror, RossDAO, UkraineDAO, POAPs, Gitcoin Passport, Gitcoin Donations. Forkers of the app can customize this with their own data sources, to fit the type of expertise needed to intelligently distribute their fund. Voting flow logic is coded in the app.

    • Funding Used: $14,540

  • Milestone 3:

    • Description: Finalization, Deployment, and Release Communications

Activities:

  • Testing and deployment of final features, including voting completion UX/UI.

  • Finalizing GitHub documentation, client config files, and metatags.

  • Preparing for public launch with user testing, issue writing, and coordination with accounting.

  • Copywriting, Twitter promotions, organizing workshops, and release communication planning.

  • Handling budgeting, worklog payouts, and interfacing with stakeholders.

    • Immediate Outcome:

The app is now available for forking at GitHub - dOrgTech/PairDrop, with a demo at https://pairdrop.daodrops.io/

The differences between PairDrop and Optimism or General Magic’s pair voting apps are:

  • Voter points are distributed using a dynamic, adaptable script to scrape on-chain data that demonstrates addresses have various types of expertise and experience in Ethereum. (The algorithmic governance innovation from DAO Drops V1).

  • Round operators can customize how many pairs are selected. As few as five pairs, even with a low number of voters, successfully determines preference average.

  • It uses BudgetBox by Colony, a trusted machine learning model for generating a “preference graph” to normalize funds distribution based on voter choices. We believe this mechanism is an underutilized way for communities to harness their collective intelligence in an efficient and unbiased manner.

    • Funding Used: $ 11,320

  • Karma GAP:

Challenges

  • Previous Challenges:

    • Description: Definitely reaching the minimum threshold is crucial for us. We are currently exploring ways to overcome this challenge, particularly since we were the last project to reach the minimum threshold in Epoch 2.

    • Updates: It is definitely going better, not only because we are continuing being selected to be part of Epoch, but because we have a loyal community interested in what we build and a set of planned drops based on what we’ve found missing in their larger cooperative of dOrg.

    • Resolution:

  1. We did a more aggressive reaching out process to all members that had GLM tokens.
  2. Then, we saw an opportunity within all Octant community and encourage their support showing our own support to other initiatives
  3. We started posting more frequently about our next drops
  4. We started engaging more with the Octant community through discord

How did you resolve these challenges? Describe the steps and strategies used.

  • Lessons Learned: Trust the process! and the team behind Octant really listens to our feedback and comments about the allocation and distribution process, so we must keep sharing our thoughts on it to improve Octant.

Outputs and Outcomes

Outputs (Last Epoch):

Output 1:
Developed and shipped over 5 major features including voting flow logic, accessible, easy to review project profile, WebGL performance enhancements, forkable voter points script integrating multiple data sources like Gitcoin, Mirror, and POAPs, and BudgetBox algorithm for intelligent fund distribution even with a small number of voters.

Output 2:
Implemented the BudgetBox algorithm for intelligent fund distribution.

Output 3:
Developed and tested a Voter Scoring Script pulling from on-chain data sources, allowing customizable voting weights for different communities.

Output 4:
Released the PairDrop app, now available for forking on GitHub with a demo available online.

Output 5:
Organized release communication through Substack, Twitter, and key stakeholders and contributors to engage the community.

Short-term Outcomes:

Outcome 1:
Completion of Core Development:
Successfully developed and deployed the PairDrop app with all planned features, including the voting mechanism, BudgetBox algorithm, and Voter Scoring Script.
Established a solid foundation for future user engagement and adoption by ensuring the app is fully functional and ready for use.
Released 3 composable tools within PairDrops that can be implemented by other RPGF communities.

Outcome 2:

  • Internal Process Improvements:
  • Refined internal processes for forkable app development, from initial setup to final deployment, which can be leveraged in future projects.

Long-term Outcomes:

Outcome 1:

  • Improved ecosystem functionality:
  • Significant reduction in cognitive overload and bias in funding decisions due to the algorithmic governance and BudgetBox integration.
  • Long-term cost efficiency and scalability achieved by the app’s ability to produce intelligent allocations even with low voter turnout.
  • Broader accessibility of pairwise comparison voting within the ecosystem, setting a new standard for fair and efficient fund allocation.

Metrics for Outcomes:

1. **User Engagement**:

3 forks of the app

2. **Adoption and Usage**:

3 forks of the app so far. Several requests to make DAO Drops V1 forkable

3. **Community Impact**:

New partnership with BudgetBox from Colony. New partnerships formed for our upcoming Privacy DAO drop.

4. **Financial Metrics**:

Cost savings achieved for voters by avoiding traditional cognitive overload in decision-making processes.

Cost savings to round operators achieved by automating budge holder / voter voting weights.

Plans for Potential Funds Raised in the Next Octant Allocation Window

  • Goal 1: Privacy DAO

    • Description: In Private DAO the privacy of its members is paramount. The infrastructure is meticulously designed to ensure that each interaction and communication is encrypted and secure. Make decisions and allocate funds as a community without revealing the identity of participants. This is important for civic activism, human rights DAOs, and Web3 grants operators who want to experiment with getting funds into these hard to service areas. A specific example for reference: “How might we finance Indigenous land defenders while preserving their identity and location to protect them from being assassinated by mining companies".

    • Expected Outcome:
      3+ teams using Privacy DAO in the first 6 months. Feedback and input from those interested in using Privacy DAO.

    • Funding Needed:
      $11,000

  • Goal 2: DAO Onboarding Bot

    • Description: To further reduce the overhead of grant round communications, as well as the burden on small projects to write grant applications (+ loads of non-grants use-cases), one of our drops this quarter will be an instructions kit on how to build a RAG bot using AI, trained on your community’s data. For grant writers, the bot can reference previous grant applications, knowledge materials generated by DAO members, code bases and more, to ease the burden of writing hundreds of grant applications a year, each with a specific frame as put forth by the grantor. Additionally, such bots can assist with DAO onboarding to help new members find resources, knowledge, and who to contact.

    • Expected Outcome:
      It’s easy for DAOs who are new to web3 and are not primarily made up of engineers, to understand how to set up a RAG bot to lighten the load of growing the DAO and acquiring funding for the DAO’s mission.

    • Funding Needed:
      $6,000

Other Funding

  • Grant Funding Received Since the Last Epoch:

Direct funds from Gitcoin: $96, matching funds as yet unknown.

  • Other Non-Grant Funding Sources:

none

Future Plans for Financial Sustainability

It’s now been 4+ months from your initial application. Have there been any changes to revenue sources and income generation plans. Share your story on how your project plans to achieve long-term financial sustainability and the progress since the previous epoch. You may include updates on any of the following aspects:

  • Changes to your revenue sources and income generation plans since your initial application.
  • New or ongoing strategic partnerships or collaborations that support your project.
  • Plans for securing additional funding and ensuring diverse funding sources.

We applied for GG21 in the “Web 3 Grants ecosystem Advancements” and “CollabTech Round”. We are waiting for the final calculations to know exactly the amount donated to DAO Drops.

A potential revenue stream is teams hiring us to help them implement DAO Drops V1, PairDrop, and other tools.