Shouldn’t projects receive GIVBacks for donations, too?

There are costs and they include:

  1. taxable event depending on jurisdiction.
  2. Usability opportunity costs of using L2 solution.
  3. Off ramping or accessing funds.

Depending on the group/project size, their knowledge base and resources each of those can disrupt who continues to use Giveth as a platform.

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This is viewing Giveth platform from a binary legacy view of philanthropy model. The fact is token engineering a mechanism that creates incentive for projects to not sell is possible.

One example is working with strategic partners who hold % of Giv supply and use it as a reward mechanism for community members who want to support grass roots projects.

IMHO, Giveth tokenomics atm is focusing too narrowly on legacy institutional donors and not gtk the potential of a collective donor base of individuals who would also be building traction in the Giv token use case through staking.

TL;DR - rewarding legacy donors w/ Giv is similar to concentrating potential of Giv. If the concern is sell pressure for Giv then there’s not enough of user base for the token. Allocating Giv bags to less engaged donors (latent user to web3) can progressively be part of strategy but not the only one to hold demand side.

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FWIW @karmaticacid @Griff @mitch @Suga

I’ve been recycling the same $500 donation on Kiva since 2014.
I used to manually reloan the funds and at a certain point Kiva implemented a learning algorithm about my preferences for loaning and it looked something like this:

  1. If recipient is female/mother
  2. and loan is within 90% to funding
  3. then fully fund

I mention this because my giving style is to finalize and make opportunity real for the person seeking funds. I also know that the field of token engineering can be used for more than just an incentivize/bribe rewards. In fact I know token engineering can be used to model the flow of user behavior that optimizes for specific kinds of users/behavior.

I’m sharing this bc my hope is either through a governance process or smart contract implementation that GIVForwards can begin to inform a credit allocation algorithm for users who actually put their Giv to use rather than simply stake to reward themselves. Simply said too much thinking about what rewards degens instead of regen user types.

I scanned the GIVmatch link that @WhyldWanderer shared and found myself wanting to see the diagram/flows and outputs that are informing the parameters being considered.

I know Giveth as a brand has been around since 2017 but I don’t know that I’ve ever come across a simple white paper w/o the branding that maps out the token supply over the ecosystem and participants it’s intended to serve.

It’s possible I may have missed a miro board so please someone surface it for me. I’m basically trying to see the value flow and outputs of GIVmatch, GIVreward and GIVforward. To me they’re all a form of GIVpower and I wanna visually understand how the game theory behind each of those circulates when modeled out. Kinda like an electric circuit.

Lastly I wanna share that I admire all that everyone has done to steer the Giveth ship to this place because it is a remarkable platform/product. Stay epic ya’ll and ty @rainer.hoell @qqsong for opening this can of worms.:purple_heart::mushroom:

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Thanks for itemizing the cost to the projects/nonprofits.

The nonprofits I talked with have hesitations not against crypto but worry about the tax situation depending on jurisdiction when they receive funds (this is particularly true in Europe). Hiring a specialist to inform them about these taxable events and off-ramping sometimes cost way more than the donation themselves (given those are really small amount, far less than the average gift in other platforms). These costs need to be considered.

That forum post is a place for idea generation as of now. We will discuss options and share ideas there. Then, once the matching pool has reached 250k (half of our goal), we will start to create a plan and action items on implementation. Nothing is written in stone over there and we would love to have your input if you have any great ideas on how we can distribute the funds in the matching pool.

I am similar to you with the visual aspect as well… much easier for me to visualize the bigger picture.

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I wrote a pretty thorough spec however that is open for review:

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@rainer.hoell Thanks for this proposal, IMO you did a great job underlying the perpetuation of power dynamics that are a challenge for the operation of non-profits and for good projects.

TL;DR: I agree 100% with the spirit of the proposal. But I don’t believe a simple split of the GIVbacks is the way to fix it. I will try to break the issue to make it easier to separate spirit from implementation.

1. If we are building the future of giving? Shouldn’t the grassroots organizations have governance over that future?

Hell yes. They are the ones that know the best way to create impact. As @qqsong stated the data backs this up. It’s not a coincidence that the people that have more experience working with non-profits are bringing this point forward.

Do you disagree with the governance point too? @mitch @karmaticacid

2. Should we split the GIVbacks between donors and projects?

I don’t think that’s the right move.

As @karmaticacid and @WhyldWanderer state, the GIVbacks program is an incentive designed to create reciprocity to donors. It’s especially important to keep it above 50% since we compete with tax breaks and it’s in our best interest to offer a better deal. Furthermore, we shouldn’t approach 100% in GIVbacks otherwise our platform would be gamed.

But we can offer governance to projects and even additional funds without splitting the GIVbacks. Here are some ideas:

a. Create a governance structure similar to optimism, where governance is splitted equally between two houses: The Citizens House and the Tokens House.

b. Projects could receive soul-bound NFTs or a different token for projects that incentivize good behavior: Creating a project, getting more donations, making more impact, uploading their updates, etc. I prefer the soul-bound NFTs because maybe part of the governance shouldn’t be tradable.

c. GIVforwards sounds like a great idea. That would let donors GIV more than 100% of their money.

Additional points:

For the for good projects, it’s not going to be as easy as build-it and they will come. I definitely think we should get more creative on helping projects get benefits from Giveth. Some can be based on code and rewards. But others are about helping them use the platform better, develop skills, and help to understand all issues that can make them hesitate. Like tax implications or the risks of web3. This is why I love the idea of having the Fundraising 101 program.

Even though I don’t believe we should split the GIVbacks program. I would get onboard with redesigning a reward system that would reward different stakeholders: referrals, projects, people offering support, we could probably have many more stakeholders and I think we should incentivize anything that would help Giveth and its impact grow.

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Idk that this serves as an incentive to an already tax exempt entity. I think the real benefit of allocating more to token supply to donors is so they can navigate slippage or conversion dynamics to get funds to destination.

For example a person donates $1K in US securities to a foundation/charity the foundation/charity may elect to not sell those and instead offset the $1K donation from a separate internal fiat cash account. Then they’d have to put that $1K fiat to use in ETH <> GIv with enough GIV token supply to ensure roughly a $1K donation is made on Giveth tp a project.

This is why I believe a pool together rewards model using GIVbacks would benefit the entire ecosystem because it would represent a greater % of the total 50% allocation and with a proper governance participation layer act like a perpetual reserve to the token value and applied towards givebacks based on defined ranking parameters.

I like this and can see this working because Giveth’s flexibility in iteratively tweaking a rewards program could chart a path toward improving the relationship between donors and projects.

For example, if a governance framework was established to oversee the shared responsibility of fund distribution from a rewards program that were allocated for use in a community development financial institution; then that % of GIV would be used to incentivize bringing projects and donors together in specific regions or initiatives of impact.

Obviously the criteria for groups or individuals who have the opportunity to share in this specific kind of decision making would need to be defined. I’m curious to see what emerges in human behavior and platform use as we progress w/ donor onboarding. I’m sure we’ll get new data to consider from that alone.

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Hey everyone, sorry for the radio silence. Covid crushed me for five full days after ETHBarcelona, and I am still not fully up to speed…

@mitch, @karmaticacid, @rpiesveloces, thank you for your early comments, I learn a lot from you here. And thank you all also for the thoughtful comments after that. We have a few fantastic implementation ideas here!

Here is what I see on the spirit level (to use Cotabe’s distinction):

There are differing views on more governance power for projects. I understand the inclination to say “but they already get the donation itself, isn’t that enough?”. Three thoughts on this:

  1. It really is more about decision-making power than funds. The tragedy in philanthropy/giving is that privileged donors gladly give money to nonprofits, but they typically don’t question or even change the structures ensuring their privileges. The only remedy is to make the infrastructure for giving itself more egalitarian. Giveth has a chance to do exactly that.

  2. For this reason, I am skeptical of solutions where donors themselves decide to share some of their GIVBacks with projects. It would be again the mercy of the donor that decides if projects get more of a say. It reiterates again the same power dynamic.

  3. I understand that projects can also get GIVs through other ways (donated GIVs, matching funds). The question for me here is: Does Giveth merely allow projects to also hold GIV? Or do we actively encourage them to use them (besides selling them)? I think Giveth should send a signal to let them know they are offered a seat at the table and that there are welcome in the community.

Here is what I see on the implementation level:

  1. There are good arguments against piggybacking on the GIVBacks program. I understand that. So whatever we do for projects, let’s not call it “GIVBack”. The main reason I had suggested a “split GIVBacks” approach was that I did not want all of this to be more expensive for Giveth.

  2. Another learning: Whatever we do, it should not make it too easy for projects to just sell off the GIV they receive, putting pressure on the token. That’s why I like the alternatives: GIVForward (cool name!), soulbound NFTs or the two-house model. I guess it would take a session with people way more crypto-competent than me to decide and/or design the best mix of these.

I think criteria for the best mechanism regarding the latter could be:

  • distributed by Giveth itself, not by donors
  • governance power not (too) second-rate compared to donors
  • easy to understand
  • not too easily transferable
  • as inexpensive as possible for Giveth

@Cotabe, would love to have a call with you on this.

Right now, I think the GIVForward idea is probably the best mix of all of these. If the GIVs are pre-staked, they are not that easy to sell. And once projects have found out how to do that, they have learned already a lot about tokens and DAOs – which is exactly what we want. And it would instantly make all the other GIV-based mechanism accessible to projects, e.g. GIVpower. But let’s discuss.

Oh, and I love the cross-reference to the matching fund. Will comment separately.

I would love to keep this thread open for more discussion for another week or two…

I appreciate the time to make a well formed response, however I too still have some strong opinions.

We should not generate more GIV emissions, so if we’re not taking from GIVbacks I wouldn’t support assigning a portion of our unallocated funding to this new idea. Allocating GIV, albeit staked (staked into what?) might give projects a more direct opportunity to game the system, if we directly gave them GIV, and they themselves get GIVpower that they stake back on themselves.

I don’t fully understand the narrative of why donors shouldn’t have more decision-making power than projects. Projects pay nothing to be on the platform, they get free hosting and free exposure, donors are the ones giving away their funds. If anything you could give projects more of a say but I don’t think they should have equal or more decision-making power than donors. It’s written fairly explicitly in the Giveth Mission and Vision that we are a donor-focused platform.

It’s the Future of Giving, not the Future of Receiving.

If the will of the herd approves though…

Soulbound NFTs are okay but there’s no way to quantify the governance power with a single NFT, there is also a lot of development work needed to implement such a solution.

Really if you want to award just governance to a project then you need to spin up a non-transferrable (soulbound) reputation token, it can be a simple ERC-20. This approach could be potentially integrated easier into existing systems, namely Gardens and Snapshot.


In general this might turn out to be an interesting idea but I don’t think it should have a huge priority against the current Giveth roadmap.

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Yes, I agree that projects on the platform are being donated a lot of GIV but if projects use this GIV to participate in the ecosystem - projects are sacrificing donations upfront. This means taking money away from the causes they work with - this could mean taking money away from refugees, from education for children in deprived regions, from projects bringing clean water etc. This is the main reason why projects want to cash out - they see donations on the platform as exactly that - as funds to help people, situations in need.

The playing field is not equal here because we are saying to projects that they must sacrifice to take part in the ecosystem.

However, if projects were to be rewarded with a separate stream of GIV for the purposes of taking part in the ecosystem (and of course, getting some education around how to do this) this levels out the playing field between donors and projects. Projects would be more likely to be engaged with Giveth instead of being passive and using the platform for crowdfunding.

Donating GIV to projects passes the pressure and volatility of the token to the projects. Most projects are unaware that the actual $ value of their donations is different to the $ value on their project page due to donations being made up of mostly GIV or other volatile tokens. Currently, projects are discovering that they have been donated a fraction of the funds they thought they had due to market conditions. Projects are not aware that they are exposed to that volatility, adding further sacrifice.

Same as the point above, if we ask projects to use their GIV in the ecosystem upfront, we are asking them to sacrifice funds upfront without ‘GIVback rewards’ to compensate over time. (There are many other points for consideration when redirecting the use of funds but it’s not for discussion here). The GIV on the platform is presented as a ‘donation’ by donors and included in the donation total.

I like this suggestion as it at least allows for a levelling of the playing field but the choice, and therefore the ‘power’, still remains in the hands of the donor.

I also want to say a word about donors and sacrifice: Projects are carrying out work that the donor wants to see done but is not able to do. The people and resources involved in the project are also making sacrifices. There isn’t only financial sacrifice involved in for-good / charity work. Those that can sacrifice time / non-financial resources do so; others make a more passive sacrifice through financial support. Neither party can exist without the other - there is a mutual dependence and a mutual sacrifice or mutual achievement depending on how you view.

Donors do not feel making donations to be a sacrifice, their donation is allowing them to take part in a cause / project they care about where they are not directly involved on the ground. It is awesome that donors on Giveth can now be rewarded in addition to being able to support their favourite projects.

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The donors and most of the projects on Giveth are on the same side: they are part of the giving - the projects are custodians of the donation as it passes through to the beneficiary or cause. The receivers are usually external to the project: ie the ocean being conserved, the public breathing cleaner air, the homeless person being fed. Currently the Giveth model is asking the projects to withhold GIV from the beneficiaries in order to be able to take part in Giveth ecosystem. Projects are currently not freely able to take part in ecosystem without sacrifice to the beneficiary.

The proposal is not to reward the ‘receivers’ (the beneficiaires) but to apply equal rights to the stakeholders creating the value for the cause: donors and projects are part of the same team. Projects are taking the donation, giving it value add and then donating it to the end beneficiary.

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Something that I have been rolling around in my head since we started talking about changing the label “Verified” to something that does not insinuate ‘better than’ or cast shadow on ‘non-verified’ projects.

After discussing a bit with Rainer and running it past some members of the verification team I am exploring the idea of having a ‘GIV society’ or ‘GIVbacks club’ (better title coming).

Projects would apply to be a member of the club. Once they become a member of this club they can be eligible for different benefits. One of them being participation in the GIVbacks program.
We have lots of organizations reach out for partnerships and want to send funds to or somehow reward these projeccts on Giveth. Currently, Im collaborating with Panvala - they want to add all of our verified projects to their recipient list for the Stamps program. I see all of these things being rewards to the projects and benefits of being part of this club.

This would leave space for more benefits to be provided to the projects that are willing to step up and be active in the club, it would remove any negative connotation for projects that arent members of the club, it would provide opportunities for anyone to give benefits to these projects (from collaborations like Panvala), and it would encourage projects to become a public goods provider rather than a personal gain collector.

It wouldn’t necessarily provide more governance rights, but I will have to agree with the above statements in that Anyone who has GIV has governance rights, they just need to use it.

And I dont buy that we are asking them to take these funds away from refugees in order to have gov rights, we are asking people to use something that was given to them as a gift to experiment with the possibilities of how governance systems work and how maybe they can implement one into their project in the future or use our Giveth governance structure to create proposals and vote on ones that are important to them.

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I think if we analyze the data we will find that in fact, most projects are actually losing right now.

  • how many projects are actually receiving any quality donations after taking the time to learn about Giveth and create a decent project listing? The learning curves have a significant upfront cost with very uncertain return on that value.
  • how many of those projects have the ability to use donated crypto in any way without having to sell it by also setting up a centralized exchange account and linking it to a bank account? The benefits of working in Web3 and receiving crypto donations are quickly lost in having to link right back to the traditional systems for accessing and distributing the funds.
  • Of the projects that are receiving donations beyond the 1 DAI / 1 GIV random airdrop hunters or testers of the Giveth ecosystem… what percentage of their donors come from outside the Giveth ecosystem? Donations are mostly in GIV because it’s mostly people who are Giveth contributors past and/or present that are giving to those projects IMHO.
  • The excitement of receiving donations on Giveth is often quickly diminished when it’s mostly those .05 xDAI or 1 GIV donations or even worse, when the amount shown as received becomes a fraction of that amount by the time the project owner figures out how to get the funds out of the wallet and into the hands of a project contributor.

Project donors getting GIVbacks are far and away the big winners here when you look at the funding flow patterns as they are right now.

Project owners are very clearly saying they want to be able to participate in Giveth, from asking how their donors can best give to the project in a way that helps the GIVeconomy become stronger, to asking how they can use their crypto donations in a way that helps the GIVeconomy AND allows them to use their crypto donations to further their stated mission.

This is a super cool idea Ashley! Although I think better title is needed for sure… The “Club” word seems very exclusive. I love the concept though and having additional benefits for projects that provide public goods is awesome. Note that GIVpower will be one of those benefits too.

Also, you nailed it. Donations are a crypto gift. The advantages of crypto are that you can do all kind of amazing things w/ it… like vote in a DAO or stake it and earn a yield. Also the volatility provides opportunities for greater returns through DeFi. It’s a learning curve for sure to come from web2 and get into web3, but it’s also an opportunity.

I think putting effort into improving resources and information for projects onboarding into the crypto space… and specifically the Giveth DAO… is much more worthwhile than just bleeding out more GIV from the economy.

We should put this debate energy into the comms WG, for example, on the Project Owner 101 Video Series… or take some of pieces from Katya’s donor flow improvements assignment.

Many of the points in @Danibelle’s comment I think are in-line with that.

There’s a lot we can do to improve our onboarding flow & resources for projects. We should also look to solve the problem of “how can we get more donors (outside of the Giveth ecosystem) to use Giveth to donate”.

According to the giving block, there is about $300,000,000 donated in crypto each year. We need to get our message out there… get those donors on Giveth!

The GIVeconomy can’t sustain just putting more GIV out to projects in the hopes of helping them onboard to the DAO, and we can’t expect to fund every nonprofit out of our own pocket. Instead we need to focus on improving resources for onboarding & attracting big donors to our already amazing platform.

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Totally agreed with this point. I don’t really like the word “sacrifice”. Donors are not making any sacrifice whatsoever as they choose to help out for social good and it’s their responsibility to also choose the project they align their value to. They have a choice not to donate. None of us who choose to make a change in the world are sacrificing anything.

For project, this word, also too heavy, may be more true as most nonprofits work on a shoestring and does not have money to pay for valuable work. The social business model resolve some of the problem turning donors and funders into clients. If projects can be rewarded, that’s the true “sacrifice” that this is resolving.

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Unfortunately as some one working in fundraising for 17 years, I don’t buy this narrative of donor first and project second. Donors give only because they want to make a change and most often they have a specific project in mind to help making those changes (especially bigger donors). Without project, there will be no donor. As fundraisers, we are just connecting causes with donors (two dots) and there is no third dot (the project) and certainly no fourth dot (a giving platform). Donors won’t come because of Giveth platform. Projects need to come first and they need to fundraise from their donors to bring them here. That’s the tried and tested strategy from many giving platform model. I think the Giveth team should invest some energy in truly understand the complexity of nonprofit fundraising and have some strategic foresight instead of assumptions and wishes.

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Interesting as this is the power dynamic that the philanthropic world is reckoning with and trying its best to change with Community-focused Fundraising for example. This is a colonial approach (money talk) that shouldn’t be the centre of Giveth’s narrative which I thought was about “people on the ground”. If people continue to think like this, it’s going into dangerous mistakes that for over 100 years people are making in the international development world. Community should eventually have more say not capital. Again, this is something web3 can change if it wants to. A paradigm shift is sorely needed to break away from a patron/receiver relationship between donor and projects.

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Of course we want great projects to use the platform form, but the point stands and I will fight on this:

Projects should absolutely NOT receive GIVbacks for donations

This is completely unsustainable for Giveth & the GIVeconomy. I’m sorry, but we are not an endless fountain of money. Giveth itself should not become the biggest donor on Giveth, and there is no economic benefit to bleeding more GIV via this suggestion.

We should raising more matching funds. We should reach out to people wanting to donate to support the matching funds. We should bring those bigger donors onto the platform so they use Giveth to donate. We should help projects onboard. There are a lot of things we should do, and dumping our more GIV is not one.

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I just want to quickly chime in here that I totally agree with @karmaticacid on this point:

The GIVbacks program was designed specifically for donors and a focus for this GIVbacks program is to drive more non-GIVbag donors to the platform and turn them into GIVbaggers with GIVbacks.

It seems though that this post has sparked ideation on the need for a program that enables not only projects, but contributors to projects, to be able to use the GIV they receive in creative ways that DO sustain the GIVeconomy while also stimulating local crypto-economic systems.

So maybe it’s time to harvest the great feedback of this thread into a new GIVforward thread.

The idea that projects and their contributors are now GIV holders and can become GIVers through a new future GIVforward program just for THEM … is very exciting.

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