This summer, we had a very nice chat with Griff Green, founder of Giveth and highly involved in the Common Stack project. Griff is far from being an outsider to the blockchain ecosystem, but his involvement and determination to build a bridge and give a voice to the nonprofit world amply deserved a place in this section.
You can watch the interview here.
What is Giveth?
Giveth is a community focused on blockchain for good. Our goal is to try to take this amazing technology and make it have a real positive impact on this planet, specifically for the nonprofit space, which is kind of our target. So we think there’s a major opportunity to realign incentives in the nonprofit world. It’s the most misaligned in incentives structures that I know of, where people who support nonprofit work, do it out of selflessness and altruism, and end up suffering the most. Like if you donate to a charity, you get nothing in return. And, if you work for a charity, you get paid less than if you were working anywhere else. But clearly these charities and nonprofits are producing value. So, if they’re creating value, why do they have to do it selflessly? And this is where I think Aragon Fundraising, token bounding curves and crypto economics primitives can realign incentives and build new economics structures so that the people producing the value can actually do so, and be rewarded for it.
Which problems Giveth wants to solve?
The biggest problem for me is that charities produce value but that value doesn’t end up on a spreadsheet, so the rest of the world doesn’t care. Giveth hopes to change that by working with a project called the Common Stack to create economies around causes. This is our current target right now. We’ve built an application we’ve called the Giveth Dapp, which allows anyone to trace their donations and trust that the organizations that are using their fundraising will spend the money appropriately, because they can see exactly where their money goes. So you don’t really have to trust the people because you know and can follow your own donation. That is just the foundational layer that we needed to build so that we can make sure that "normal" people can interface with the blockchain space and use some of those cool tools for good.
Aragon Fundraising is a huge piece of that. I am so blown away by the work done by Aragon Black. This is bringing token bonding curves to the masses! Making it easy to use with the UI and making it modular so that anyone can go on and create their own Aragon DAO. Click a button and boom, they have their bonding curve! It’s incredible!
I’m hoping that Giveth can integrate that to be a sort of proposal framework for the "normal" people. We are still a little far from that of course. It’s going to take a long time before the person who is an environmentalist and just cares about rivers can actually interact with bonding curves. But we are trying to bridge that gap as quickly as possible.
Can you explain what is a bonding curve?
I actually do this a lot! I can’t stop talking about bonding curves to all my friends and family, and they’re probably sick of me by now - but, the way I usually do is; it’s like a forprofit company that can issue shares. I’m not talking about doing an IPO, like selling stock. I’m talking about the small hotdog stand that says « hey, are you interested in investing in my hotdog stand? You can own a part of the stand but I’ll need some investment money! » Any forprofit company can just issue stock. The problem is that it's hard to know what is the stock worth. There’s no real way to understand what the value is there. Token bonding curves actually take care of that for you. You can have a one sided market. You can have an algorithmically determined price for that share. So that, despite the lack of liquidity for that hotdog stand shares, you can actually know what a fair price is and what it’s going to be, based off who participates in buying those.
For me, what is really cool is that it doesn’t have to be a hotdog stand. It can be anything that produces value. So if charity is producing value, protecting a river, then they can compete on the same level as a factory that is polluting the river. The factory that is polluting the river can create stock in their company and give their employees stock options. They can sell stocks to investors so they can gather capital to pollute that river, even better! In fact, they even have a fiduciary duty to their stockholders to pollute that river. If they say « Hey stockholders, we want to pay ten grand to get rid of our pollution and keep that river clean », stockholders could sue them. That’s how bad it is!
The nonprofit just need money but can’t give anything in return. They work for pennies and do their best to compete with big companies. So, they’re not going to win… It’s just a sad state of things… Because they have no way to raise capital.
You have to rely on people selflessly who are giving because they believe in values. But incentives are made such that you just want to live by that river and not give, and hope that other people do it for you: Tragedy of the commons. But now, we finally have this opportunity to say « no, the river has value and anyone that’s contribute to that, can be given a financial asset in return; a token that is tied to a bonding curve, that has value, that could go up ». Of course, it can also go down, but it’s way more better than a normal donation. When you make a normal donation, the value you get in return if necessarily zero. Here, there’s a chance you might make profit and you have a financial asset to represent some stake in the game, in some decision making power. It’s the same as a forprofit company. When you’re an investor, you often have some kind of staking power on how the company is run. That’s a long explanation but this is how I can explain it.
I’m often speaking about the nonprofit space and trying to bridge the gap to forprofit space, so that people can see the value in token bonding curves.
Which charities will use Aragon fundraising?
Our beta tester for the Aragon fundraising platform is GRACEaid. It’s an amazing charity in the United Kingdom that supports refugees all over the world. Andreas Papazidis, who runs the charity, has actually hacked on bonding curves with Giveth at a Odyssey Hackathon in the Netherlands. I don’t know if there is anyone in the nonprofit world that knows more about token bonding curves than Andreas. So, he has been studying this stuff non stop and has been with Giveth for probably a year and a half. He has already raised a few thousands dollars on the Giveth platform and we hope to catapult forward with Aragon fundraising. He’s going to be the first beta tester, and we are really excited if he can blaze at the trail for us and make other people join in.
We have a charity in Mexico that has a hospital that help childrens with cancer from low-incomes families and give them free treatment. We have sex workers rights organization in South Africa called Sweat. They had a candidate for presidency in South Africa. They are an awesome organization. There are also a lot of tech organizations that use Giveth. Dappnode started on Giveth. And they’re also hoping to beta test Aragon Fundraising, although they will not integrate with Giveth, they’re just going to do it as a DAO. I think Bright ID is also very excited about that. They’re also on the Giveth squad. And of course, the Common Stack is another organization that we are super excited about. It’s a whole play so we are excited to see how this works. Our goal is to take what Aragon Black has built and put our own smart contracts and hopefully work with Aragon Black to do it.
So we have many projects that want to be in working with Aragon Fundraising. That’s for sure!
Why Aragon Fundraising for charities?
The main thing is that nonprofits are at a major disadvantage compared to the forprofit system. Nonprofits produce value. If you can agree with that, then we can start the conversation about economic models. We live in a world that has a default economy and that economy runs off an economic model that has holes in it. The goal of economic models is to allow people to get value, determine actual price of things and distribute value. But shared resources and taking care of the less fortunate in society is not valued. So our capital markets are all focused on things that ends up on a spreadsheet.
Token bonding curves can actually bridge that gap. They can allow people that are producing value, that is only qualitative and not quantitative, to raise capital the same way that a startup would raise capital. This will allow nonprofits to compete in the forprofit space. They can start cleaning that river the same ways as if they had an economic model. They would go and find people who care about that, that are value-aligned, who would invest in the river itself and if we connect the Aragon Fundraising to an Aragon DAO, people that donate and receive the tokens can in return decide where their funds are going.