Welcome back to another edition of Token Tuesdays!
This week marks the beginning of the quarterly Gitcoin Grants CLR Round.
We’ll cover what’s new with Round 5 along with a quick guide on how to approach launching Gitcoin Grant proposals.
Let’s dive in!
-Lucas and Cooper
A Brief Recap on Gitcoin Grants
For those unfamiliar, the Gitcoin Grants CLR Rounds leverage quadratic funding – a fundraising mechanism where Gitcoin matches grants relative to the number of individual contributors to a given project, rather than the total amount donated to the project. As an example, a project that receives 50 individual 1 DAI donations will receive a significantly higher amount in grant funding from the matching pool than another project that receives a single 100 DAI donation.
Every quarter, the Gitcoin Grants round has consistently grown, both in terms of the matching pool and the amount of individual donors. While not depicted, Gitcoin Grants Round 4 broke new records with a $200,000 matching pool and over 5,936 contributions across 230 Ethereum projects.
What’s New in Round 5
With Gitcoin Grants Round 5 beginning yesterday, we look forward to another successful round of innovative and sustainable web 3 funding.
The new round features a $250,000 matching pool with the following allocations:
- Public Health ($100,000) – Support for COVID-19 research, response and recovery projects
- Tech ($100,000) – Support for Ethereum infrastructure projects, DeFi protocols and applications, wallets, and more
- Community ($50,000) – Support for media, community, and marketing projects
The most notable addition here is the $100,000 support for COVID-19. The virus has taken a toll on global economies and it’s great to see the Gitcoin team taking an altruistic approach in mitigating the aftermath and supporting those affected.
Round 5 also introduces a handful of new features tailored towards a better donation experience for contributors. This includes:
Negative Voting: Given certain controversies in the last Media round,members can donate against Media grants to signal negative feedback. The amount donated is deducted from the grants matched funds.
Fixed Pairwise Threshold: On the backend, Gitcoin has upgraded their matching algorithm to better mitigate collusion.
Recurring Donations: Users have the ability to donate projects on a recurring basis for future CLR rounds.
Grants Feed: In order to promote signals rather than capital, Gitcoin has implemented an activity feed that allows donors to add messages to their donations.
In addition to the massive amount of work done by Gitcoin, a number of other DeFi projects are also leveraging their products or applications to help encourage donations from the broader community. Supporting projects include:
- The Giving Block – Making crypto donations easy for public health partners
- PoolTogether – Donator Ticket Giveaway
- rDai – Use rDai to pledge support to Gitcoin Grantees alongside prominent community members
Most notably, PoolTogether is giving away free tickets to all donors within a 72 hour period. The exact timing of the giveaway is yet to be determined, but make sure to follow PoolTogether on Twitter to know when it goes live.
Outside of those three, there are plenty of other initiatives running in tandem with the CLR round, all facilitating contributions towards this altruistic form of web3 funding.
Generally speaking, it’s great to see more and more projects who’ve run successful grants in previous rounds to take a step back and help new projects realize their potential.
Checklist For Launching a Gitcoin Grant
For those looking to run a grant this round, we’ve created a high level checklist on what you’ll need for a compelling proposal.
- Project Overview – What is your project and how is it benefitting the larger Ethereum ecosystem? Keep it short and sweet and link to a larger primer if you have one.
- Recent Traction – What are some of the key metrics you’ve achieved that show your project is being well received? Provide links to social proof or research which backs up your claims.
- Use of Funds – What are you planning on doing with your donations that you couldn’t otherwise do? The more creative the better, however the biggest takeaway is that unless you need the funds to something specific, we encourage you to let those funds go towards other project which can put them to tangible use.
- Why Gitcoin? – Have you explored other funding avenues? What is it about Gitcoin Grants that makes this funding opportunity unique and beneficial to your project.
- Learn More – The shorter the proposal the better. However, please don’t assume that everyone knows everything about your project. Instead, point them to a few crucial resources which best explain your project and it’s future vision. (i.e. a specific Tweet thread is better than just generally linking to Twitter).
What To Expect
In the coming weeks, we expect this round of grants to start vamping up. It’s important to recognize that there’s a fine line of begging for money and encouraging donations in a digestible fashion.
The best thing you can do is make people aware of the value of the project, rather than directly asking them to donate. Similarly, it’s important to recognize those who support your grant. With the latest grant feed, it’s never been easier to add a quick comment thanking someone for their contribution.
Perhaps the best part of CLR matching is that even $1 of donations goes quite a long way in the larger pool.
We encourage users to take this opportunity to try and onboard new users into the space, better helping them understand just one of the many avenues in which blockchain-based funding mechanisms can amplify community support.
If you or your team are interested in setting up a Gitcoin Grant but struggling on coming to terms with whether or not it’s appropriate, give us a shout!
Until then, we’ll see you on the grants feed!
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Fitzner Blockchain Consulting is a leading management consulting firm that specializes in blockchain-based systems and their design