Introducing Streaming Quadratic Funding | Vijay Michalik - Superfluid

[Music] all right good morning good afternoon everyone uh we are here to introduce streaming quadratic funding to the world uh my name is Graven I am one of the co-founders at the geow web with me here is VJ from uh super fluid yep head of product of super fluid and uh want to give a shout out to our friends and collaborators at gitcoin all and getcoin passport they're not up on stage but they were integral to uh making this project come to life so before we get into streaming quadratic funding we're just going to do a quick refresher on what quadratic funding is if you're not familiar it is a mechanism that is used to democratically and effectively allocate a matching pool and so in quadratic funding your dollars are votes if you care about something a lot you can donate a lot of money to it but in instead of just having a direct uh linear relationship between the amount of funding that you donate and the your power of the matching pool quadratic funding introduces a really cool Concept in which is that how many people are supporting that Grant with you that's a super important signal for how much uh of the matching pool you should get and so it's a dynamic matching uh mechanism and so uh in this simple example we have up here the same amount of dollars are being donated to a grant but the grant that is getting smaller donations but with 10x the number of people supporting it are going to end up with 10x the number of votes or matching and so um why would we want to do that but it seems took me a while to even explain what was going on there um why do we go through all that trouble well quadratic funding was introduced by vitalic butterin Zoe hitzig and um Glenn W and they did a bunch of fancy math and basically proved that this is a near optimal way to fund public goods and we won't get into the math of how that works but we can actually just rely on our intuition on why this this mechanism Works gitcoin grants if you're familiar if you've been around web 3 for a while they use quadratic funding for all of their Grant not all of their grants programs but their main grant program and they've raised over $56 million for public goods with that uh for both crypto and non- crypto public goods and if you've been on gitcoin or not you can visit a grante page and you can end up seeing if I donate $1 I'm going to get 100x or more in matching if it's a popular Grant and when you see that it's like a superpower it draws you in and you're going to donate right you feel that pull and you don't just give out the 100x matching to just any Grant it's the grants that have been supported by the most people and so so it ends up with this feedback loop where you can overcome one of the most tricky things in public goods and that's the free rider problem and so all that math all that that thing when you see a big number you're going to donate and you end up getting more efficient decision making but how quadratic funding rounds have been run to date um come with some downsides if we think about that mechanism what's actually happening you have to aggregate all the votes together do a computation and then you're going to release the funds so it happens in these batches in these rounds and typically in in crypto so far they're say two weeks long and this means that as a donor you have two weeks to go log in sift through potentially hundreds of Grants and make decisions about which ones are worthy of your your support there's lots of them it's really hard it it's asking a lot of donors to make that many decisions on the grante side as a public good this might be your whole budget for the quarter and so in this two-e period basically you're going to drop everything and you're going to focus on marketing but so is everyone else so it creates this Dynamic where everyone's competing for attention that's inherently limited um and you end up losing track of what you're you're actually building you you lose momentum and uh the other part is just structurally it creates pressure to centralized discovery of these uh these grants uh you have limited time you're going to log into a single website it's going to present you the grants and the order in which you see them could affect who you're going to donate to are you really going to make it to Grant 500 and give them as much attention as you did the first one it it really becomes a really challenging Dynamic and so this batch processing and this setup just creates a lot of rigidity and we start to lose some of that theoretical efficiency that quadratic fun funding offers and what gets people so excited about it but it doesn't have to be this way um quadratic funding is a is a uh very versatile idea and so this is where streaming quadratic funding comes in we're going to do away with that batch processing and we're going to embrace the full programmable nature of money that we have on ethereum and we're going to implement quadratic funding with streams it's a little blurry up there but you can see uh some money flowing on a UI we'll get into what is actually happening there so what is streaming quadratic funding it is a implementation of quadratic funding that is funded and distributed in real time instead of collecting all those votes batching them together and sending out big piles of money after after some period we're going to shift the model to having a matching pool that is streamed out every single second and the allocation of that matching stream is going to going to be determined by who is voting at this exact second and so those votes can change over time and adjust and so will the matching streams effectively what this ends up creating is a series of micro quadratic funding rounds run each second funded and distributed each second and it really changes the whole dynamic of quadratic funding rounds it's not just faster it is faster but the continuous nature uh just really changes the Dynamics across the board and it becomes something totally different and so there's a whole bunch of benefits um we'll cover a few here the first one that is really about embracing informational advantages and changes over time and so with streaming quadratic funding with a quadratic funding round every single second new information comes in you can adjust and make a better decision you can add grantees you can remove grantees you can increase the matching pool you can change your mind about what you are supporting you don't have to wait until next quarter or next year or next half year to uh change your decision about what public goods you want to support up next is decentralization I talked about that pressure to consolidate all the activities that are required for a successful quadratic funding round because streaming quadratic funding can be ongoing it can be open-ended or at least way longer than two weeks uh we can start to push the discovery and the decision-making to the edges instead of a centralized UI we could have something like this right next to the follow button on GitHub or Twitter or wherever there could be a button to donate to uh your your favorite public good through a streaming quadratic funding round but instead of just a simple donate buy me buy me coffee button you're still going to get that uh extra jolt of uh support through the the matching pool next as as we relieve this pressure on decision-making uh we're going to end up with higher conviction support systems between donors and grantees it's like a supercharged patreon you're going to open your streams they can be open-ended and the builders are going to be able to focus on delivering their Vision rather than marketing and worrying about where their next paycheck is going to come from they'll have instant access and be able to just focus on making the Maximum Impact and last but not least what I'm most excited about and what we see a lot in web 3 is composability money is information and streaming quadratic funding processes that money and information in real time so it makes a great thing to uh plug into other mechanisms you can even start stacking streaming quadratic funding rounds to embrace localized decision- making and make it more a bite a bite-sized problem in your allocation challenges so how does this thing actually work what did we actually build here um we'll just go through a quick little overview um we'll start with just say this round is already running there's a matching pool we are streaming it to three grantees here through super uh a tool that super fluid built that vj's going to get to in a little bit here called a streaming distribution pool a new donor comes they decide they want to support the the developer up top here they're going to call what's what's referred to as a strategy and Alo protocol Alo protocol is a a new tool that uh gitcoin developed to help uh do exactly this allow people to come up with new and interesting ways to allocate funds towards the things that they care about um and so we built a uh streaming quadratic funding strategy um you're going to call it your money is going to go through to the donor uh to the grantee just like you would expect but it's going to do a secondary thing and it's going to check to see your your onchain getcoin passport score it's basically just a trust score are you a Cil are you trying to uh subvert the mechanism and if you have a high enough score we're going to go ahead and update the allocation with that quadratic matching formula in that streaming distribution pool that that super fluid is built so this is all in one transaction and what happens is magically all three of the grantees in this round are going to have updated matching streams it's the coolest thing I've seen in in blockchain right now um it feels like magic and I'm just going to pass it over to VJ here for a little bit to talk more about what these streaming distribution pools are thanks cven so you might might be asking yourself how is it possible that we can achieve this ux benefit of of basically the ux of donations monthly subscriptions uh yet all of the Power of quadratic funding in the back end and the answer is super fluid distribution pools superp fluid has been built in a modular way where we've been able to add functionality over time this is the latest and greatest piece of our puzzle uh something we've been working on for a while but you can think of it fundamentally as a scalable way of doing index based streaming payments and streaming really here you can think of as recurring if there is not already a an idea of that in your mind the most powerful part of this is that you can update all of the streams that are coming out of one pool with one single transaction which basically means that it is hugely scalable to as many uh inputs and outputs as you want uh all of the outgoing streams will update from a single transaction and there are a number of of other benefits you can tap into besides that so actually under the hood all of the units the the sort of individual percentages of of allocation are actually transferable erc20 units so if you're a builder you can imagine some of the things that that would give you uh in terms of capabilities uh and optionally you can make it uh and this is something we take use of here is that you can make it that any sender can actually pay into a superflow distribution pool and have the proceeds um split uh equally to all senders uh and update via the same mechanism so this is actually live and available today if you're a builder interested in sort of finding out more about how you can use this uh please go and check out our docs uh there's a QR code below if you can scan it but otherwise you should find distribution pools there um really encourage you to go and check it out uh it is hopefully a a kind of well of creativity um and and I think what what Graven was alluding to earlier is also really important like this isn't just an isolated thing like it isn't that streaming quadratic funding sits by itself in this kind of ecosystem of of kind of composable money um as one kind of app that you can use end to end like this actually fits into the bigger superf fluid model of basically composability of money and the idea here is that actually almost any type of kind of onchain recurring payment can be model is a super fluid stream and when it when you do so then you can essentially chain them together and you can kind of have salaries vesting rewards paying out to contributors and those contributors paying into various types of super fluid enabled apps like the kind of matching pool of uh the kind of streem and quadratic funding or even things like DCA Investments or subscriptions for content and and these revenue streams loop back around to the Dows and web through businesses that provide them sort of create this flowing economy um where the velocity of money is almost infin um which is incredibly powerful uh and we have a number of other sort of benefits besides we have uh basically the concept of of hooks at the super fluid um protocol level which which basically enabled these kind of apps like streaming quadratic funding or streaming exchanges and a lot of other stuff that I'm excited to announce and talk about very soon um but uh in this model um you can imagine uh in a very practical sense um optimism grantees for rgf3 today are receiving their streams of rewards in op tokens and they could for example stream those rewards directly to the contributors of the projects and those contributors could stream them into a matching pool uh and you could basically have this full circle um of streams composing you know infinite number of levels deep um in real time uh which is something that we think is incredibly powerful and we're actually going to see um some live examples of this popping up over the coming weeks and months uh which I'm excited to share more about um but if you want to learn anything more about super fluid um and building on super fluid particularly if you're hacking this week feel free to reach out to me or check out our docs um they really explain all of this in more detail okay and so uh why I'm up here I I work on a project called the Geo web mentioned that earlier but we are the first users of streaming quadratic funding we launched our pilot just last week on uh Wednesday the 21st I believe and uh couldn't be more excited to share it and see see what happens with this experiment uh need to give a shout out to public nouns uh one of the forks of uh nouns Dow but focused on supporting public goods experiments like this they gave us five eth for the matching pool but also um this matching pool is and really the Genesis of why we wanted to build this is the GE web is using super fluid on the revenue generation side of our project I gave a talk last year about harburger taxes and partial common ownership we use that and to manage a digital land market and it produces revenue and it's been producing revenue for about a year but until streaming quadratic funding we would get those funds they would pull up and then we'd like release them in batch and that just it didn't feel right we always wanted to keep pushing towards this idea of composable mechanisms and getting this funding out into the world so it can make an impact we're a small public goods project the only way we're going to be able to compete is by being more Nimble more Nimble and making better decisions so that's what streaming quadratic funding does for us it's basically our our governance protocol now on the Geo web um so you can log on to uh goow web. landg governance and help us make these decisions about where the funding goes um and yeah so we're going to run this experiment for about two months uh it could have been open-ended but you know this is the first one we did a small trusted group of grantees just six to see how it goes but we are very excited about where to go next it's not all rainbows and and unicorns um there are challenges um and a lot of them are similar to what you see in traditional quadratic funding rounds Cil uh attacks and collusion can undermine the mechanism instead of donating $10 from one wallet wouldn't it be better if I just split that across 10 wallets same thing happens with streaming quadratic funding but there are a few differences the payout function on quadratic streaming quadratic funding is going to be incremental rather than these big batches so that kind of changes the game a little bit in the cibil attack space uh we also have the challenge of uh these donation streams are potentially open-ended we can't just have one check of your Cil score or what your trust score is up front because things will keep evolving and then finally uh VJ entered the near mentioned the near infinite power of streams in the capital efficiency an attacker could open up a a donation stream quote unquote uh to a grantee and loop it back to themselves and really inflate what they're actually donating and keep like a net uh actual outflow of zero they'd have to do some hops in between but these are really interesting problems um if you are into this sort of thing uh this is just constant red team blue team sort of thing uh gitcoin has been leading the way on that front for a long time but streaming quadratic funding is going to put out some new uh challenges to nerd snipe you and hopefully you can join us uh on the offensive side it's not all defense we do have some exciting things on the road map that we're looking forward to next with streaming quadratic funding we started with streaming quadratic funding but there is a uh another version of this that is pure votes based and it might actually be less complex in a lot of ways you don't have to deal with those Loops we'd keep the same streaming payout mechanism but the mechanism for voting would be like a commitment that you isn't like an active flow of money um and so you wouldn't have those same Loops um obviously we're looking forward to scaling this uh to more donations uh more grantees see how all those things go and then like everything else in crypto yeah ux has a ways to go um we're at the bleeding edge of this Tech we didn't Implement account abstraction or batching transactions we haven't gotten to those decentralized uh donation mechanisms that I talked about earlier we did we did build a centralized UI um for now uh but yeah lots of exciting stuff there um and yeah the water's warm so hopefully come and join us and so we'll we'll wrap up with the call to action um for for this this big QR code is that that link that I gave earlier goow web. landg governance um we need you to participate in this we need to see what happens as we stress test this more donations more data we got to figure out what happens in in the pilot also I I legitimately think streaming quadratic funding is the coolest thing you can do on a blockchain right now like full stop but not that many people know about it not that many people are here to learn about it so we need you to go out and tell people about this and participate in it um this is only going to work if the meme replicates and uh helps uh get this out into the world uh we've gotten great feedback initially as we did our twittter launch this week a lot of people reaching out to ask to run their own rounds um hopefully to help us build um we are definitely open for that this is all open source we want to see this in across the across the industry um so definitely I guess first go donate interact learn help us get some more eyeballs on this and then hit us up and we would love to build with you and see where qu streaming quadratic funding go I guess we have a few minutes for Q&A if we want I don't know there's no mics out there or uh might be kind of awkward but if anyone wants to shoot up a hand has questions do that if not all right y'all thank you for for being here good luck with the rest of bid week and uh hope to see you uh on the Internet thanks everyone don't forget to go donate