Public Goods in Crypto and Web3 : Funding the Future
Giveth, is the only crypto fundraising platform that makes it easy, free and rewarding to support public goods and for-good projects.
You may have heard the term public goods before, either in the web3 space generally, in connection to open source software, or simply in relation to clear air and water, schools, and even bus services – but what does it actually mean?
What are public goods?Public goods are commodities or services that benefit all members of a community, often offered free of charge. The cost is typically covered by government entities, meaning that public goods are often financed via taxes. Some examples are public education, roads, street lighting, parks, law enforcement and military.
Public goods are non-rivalrous and non-excludable:
- Non-rivalrous means they can be used by anyone anytime without reducing their supply and availability. For example, the air we breathe is in abundance for everyone all the time.
- Public goods are also non-excludable: everyone has access, meaning they often do not have to pay for that access.
There are of course quasi public goods such as public transportation, postal service systems and, in some countries, healthcare, which are public goods that have associated access costs. The opposite of public goods are private goods. They are available in limited supply and only to those who can afford them, such as food, clothing, electronics and most goods we consume or use in our everyday lives.
Public goods and web3
Examples of public goods in web3 are open source software, infrastructure, and tooling that makes the crypto world more accessible for all. There are more public goods than private goods in blockchain communities because blockchain requires a trustlessness that can only come through fully open source material and transparent community building.
Vitalik Buterin, Ethereum inventor and co-founder, promotes the importance of public goods in blockchain because they foster collaboration and creative issue resolution, which underpin solid infrastructure.Public goods versus the commons
While public goods are non-excludable and non-rivalrous and are provided for and managed by governments, the commons refers to shared resources, either natural (e.g., forests, fisheries, rivers) or human created (e.g., open source software, creative commons-licensed material) that have varying degrees of access and are controlled and regulated in different ways by the commons itself, to use, manage and maintain the shared resource. That management can take on various forms including informal, cooperative, or legal frameworks.
Historically, commons have existed for millennia and have proven to be far more successful than government-controlled resources,* widely researched in the late 20th Century and early 21st by political scientist and economist Elinor Ostrom, who won the Nobel Prize in 2009 for her analysis of economic governance, particularly of the commons. Ostrom’s research dispelled the myth of the “tragedy of the commons”, a concept popularized by Garrett Hardin in 1968 that received widespread use while not necessarily being grounded in actual data. Indeed, Garrett Hardin revised his concept in 1991 to “the tragedy of the (unmanaged) commons” in light of such research developments.* See for example the case of grasslands in Russia, China and Mongolia.
Sneath, David (1998). "State Policy and Pasture Degradation in Inner Asia". Science Magazine. 281 (5380): 1147–1148. Bibcode:1998Sci...281.1147S. doi:10.1126/science.281.5380.1147. S2CID 128377756.
Common Stack, a close partner in the Giveth Galaxy, supports projects in the development of commons-based microeconomies for the support of public goods and through collective governance.
They provide a library of open-source, interoperable web3 components to enable commons-oriented projects to raise and allocate shared funds and govern their commons transparently and equitably while also developing into self-sustaining, “regenerative”, micro-economies with their own token system.
- Non-rivalrous means they can be used by anyone anytime without reducing their supply and availability. For example, the air we breathe is in abundance for everyone all the time.
- Public goods are also non-excludable: everyone has access, meaning they often do not have to pay for that access.
Vitalik Buterin, Ethereum inventor and co-founder, promotes the importance of public goods in blockchain because they foster collaboration and creative issue resolution, which underpin solid infrastructure.
Historically, commons have existed for millennia and have proven to be far more successful than government-controlled resources,* widely researched in the late 20th Century and early 21st by political scientist and economist Elinor Ostrom, who won the Nobel Prize in 2009 for her analysis of economic governance, particularly of the commons. Ostrom’s research dispelled the myth of the “tragedy of the commons”, a concept popularized by Garrett Hardin in 1968 that received widespread use while not necessarily being grounded in actual data. Indeed, Garrett Hardin revised his concept in 1991 to “the tragedy of the (unmanaged) commons” in light of such research developments.
Sneath, David (1998). "State Policy and Pasture Degradation in Inner Asia". Science Magazine. 281 (5380): 1147–1148. Bibcode:1998Sci...281.1147S. doi:10.1126/science.281.5380.1147. S2CID 128377756.
Common Stack, a close partner in the Giveth Galaxy, supports projects in the development of commons-based microeconomies for the support of public goods and through collective governance.
They provide a library of open-source, interoperable web3 components to enable commons-oriented projects to raise and allocate shared funds and govern their commons transparently and equitably while also developing into self-sustaining, “regenerative”, micro-economies with their own token system.
Public goods funding
Historically, public goods funding comes from taxes as explained above. In blockchain, there are four obvious methods: individual donations, corporate donations, one-time pre-mints/pre-sales, and ongoing issuance. None of these are adequately scalable. Therefore public goods funding in blockchain turns to apps and protocols for innovative solutions such as layer 2 protocols including Optimism and Uniswap DAO, which operate retractive funding rounds in Ethereum. Layer 2 protocols have more flexibility than Layer 1 itself, but the Ethereum Foundation Grants program also distributes widely.
The manner in which recipients are chosen is also evolving, such as with quadratic funding, popularized by Gitcoin where the amount distributed to a project is proportional to the number of donations received as opposed to simply to the total amounts received. In other words, in addition to the total amounts gained, projects also benefit from “matching” funds that reflect, via a mathematical formula, the popularity of the project according to the donors. It is a form of funding that optimally reflects a democratic approach to the process.
See the example below.
The manner in which recipients are chosen is also evolving, such as with quadratic funding, popularized by Gitcoin where the amount distributed to a project is proportional to the number of donations received as opposed to simply to the total amounts received. In other words, in addition to the total amounts gained, projects also benefit from “matching” funds that reflect, via a mathematical formula, the popularity of the project according to the donors. It is a form of funding that optimally reflects a democratic approach to the process.
See the example below.
Giveth: Micro-economies, circular economies, regen economies
At Giveth we want to transform how public goods are developed and managed.
Governments typically control public goods. The problem in such a model is that while we pay taxes for their maintenance, public goods are usually poorly funded because they are non rivalrous and do not provide any incentive for development or innovation. Here nonprofits step in to try and cover the gap, but they are also poorly funded as they rely on principles of sacrifice (charitable donations). Progress is difficult without incentives.
We see a new way forward where public goods can also be incentivized through regenerative economies. This way not only do public goods have the opportunity to flourish, but the projects creating that value benefit directly as well.
See our co-founder Griff Green’s in-depth explanation in Evolving Nonprofits into Regen Economies.
At Giveth, we believe that giving shouldn’t be about sacrifice but rather rewarded participation in value creation. One way we actualize that is through the GIVbacks Program, where donors on Giveth are rewarded for their contribution with GIV tokens. We have also incorporated this into our Referral Program.
Giveth isn't just about donating and earning rewards. It's also about fostering decentralized, democratic, global communities passionate about creating positive change in the world through regeneration and public goods.
When you create a project or donate on Giveth, you'll open the door to connecting with other like-minded donors, projects, and the community at large. As part of the Giveth Galaxy of DAOs (decentralized autonomous organizations), you'll be supporting Giveth’s own long term goal of developing regenerative economies out of value-creating projects to include the circulation of their own currencies.
Giveth wants to enact real change and be part of a movement promoting regenerative economics that rewards value and rewards giving so that communities and ecosystems can benefit and flourish instead of the current model of extraction and the taking advantage of depleting resources.
Governments typically control public goods. The problem in such a model is that while we pay taxes for their maintenance, public goods are usually poorly funded because they are non rivalrous and do not provide any incentive for development or innovation. Here nonprofits step in to try and cover the gap, but they are also poorly funded as they rely on principles of sacrifice (charitable donations). Progress is difficult without incentives.
We see a new way forward where public goods can also be incentivized through regenerative economies. This way not only do public goods have the opportunity to flourish, but the projects creating that value benefit directly as well.
See our co-founder Griff Green’s in-depth explanation in Evolving Nonprofits into Regen Economies.
At Giveth, we believe that giving shouldn’t be about sacrifice but rather rewarded participation in value creation. One way we actualize that is through the GIVbacks Program, where donors on Giveth are rewarded for their contribution with GIV tokens. We have also incorporated this into our Referral Program.
Giveth isn't just about donating and earning rewards. It's also about fostering decentralized, democratic, global communities passionate about creating positive change in the world through regeneration and public goods.
When you create a project or donate on Giveth, you'll open the door to connecting with other like-minded donors, projects, and the community at large. As part of the Giveth Galaxy of DAOs (decentralized autonomous organizations), you'll be supporting Giveth’s own long term goal of developing regenerative economies out of value-creating projects to include the circulation of their own currencies.
Giveth wants to enact real change and be part of a movement promoting regenerative economics that rewards value and rewards giving so that communities and ecosystems can benefit and flourish instead of the current model of extraction and the taking advantage of depleting resources.
Giveth versus other crowdfunding platforms
Giveth is different from other crowdfunding platforms, like GoFundMe, Indiegogo, Bonfire, Classy, Kickstarter, Patreon and more, in countless ways, not least of which being the attributes described above. On a technical level, because Giveth is built on blockchain technology, it also means that every donation is secure, transparent, and tamper-proof. There are no fees, no intermediaries, and every transaction is direct: wallet-to-wallet and instantaneous.
We support donations on multiple chains including Ethereum Mainnet, Gnosis Chain, Optimism, Celo, and Polygon. More are always being added. Donating to a verified project on Giveth means receiving GIV tokens in return, with the potential for up to 80% of the actual donation. These tokens can be used for a variety of purposes, including earning rewards through staking in the GIVgarden and participating in governance. They can also easily be converted to other cryptocurrencies or fiat currencies.
We support donations on multiple chains including Ethereum Mainnet, Gnosis Chain, Optimism, Celo, and Polygon. More are always being added. Donating to a verified project on Giveth means receiving GIV tokens in return, with the potential for up to 80% of the actual donation. These tokens can be used for a variety of purposes, including earning rewards through staking in the GIVgarden and participating in governance. They can also easily be converted to other cryptocurrencies or fiat currencies.
Giveth projects
What kind of projects can you support on Giveth? Anyone can create a project on Giveth and raise funds for their cause, provided it does not violate our covenant. We focus on public goods projects that benefit communities collectively, such as arts and education centers, clean air and water initiatives, reforestation, and so much more. We also support for-good projects that are working to create other types of positive change in the world, such as environmental conservation, DeSci, social justice, and humanitarian aid.
Giveth offers a unique and rewarding way to support public goods and for-good projects while participating in novel decentralized efforts in human coordination for proactive change across networks and against the real and diverse body of threats of the metacrisis of our times.
Contribute today and start making a positive impact on the world, and help us Build the Future of Giving.
Giveth offers a unique and rewarding way to support public goods and for-good projects while participating in novel decentralized efforts in human coordination for proactive change across networks and against the real and diverse body of threats of the metacrisis of our times.
Contribute today and start making a positive impact on the world, and help us Build the Future of Giving.
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