The state of distributed open source funding and what needs to happen next

Transcript

All >> [music] >> right. So, I titled myself as open-source enthusiast that uh I'm an open source developer, but I've done a lot of roles in the open source system. And what I'm concerned about is the long-term uh sustainability of of maintaining open source projects because it basically is the backbone of our infrastructure now and all the AI stuff is still running under on the on the data centers is still running Linux and open source stuff.

So traditional uh how how the funding is done now mostly traditional grants and donations uh there's two uh categories like centralized funding uh we have large organizations like EF uh for Ethereum foundation for blockchain space but more generally like Linux foundation cloud native foundation Apache uh and governments and academic organizations that they're giving And the open source project applies for this. And uh this is kind of a lot of bureaucracy. And the big flaw in this is that if you have only a few big uh

funders then you are kind of dependent on their will and uh kind of lose independence to some degree. Then uh in the traditional way we also have peer-to-peer funding. There's a lot of uh platform for this like uh Patreon, GitHub sponsors and so forth. But these amounts are very small and it's hard to fund raise. Although I like this a little bit more because the feedback cycle is faster if you are doing your project well. Hopefully that will show up in getting lots of incremental more uh small uh funders for your project.

uh there's some overlap with crypto. Some of these projects, traditional open source projects have tried to receive crypto. Uh their funding used crypto as one of the payment methods, but uh there's been some challenges in that. And for example, open collective, the open source collective stopped accepting crypto donations. But uh I wanted to talk about like specifically funding distributed funding based on blockchain technologies and what is the current state now. So there's two like way two kind of like categories of um of technologies how this relates to

blockchain one is quad quadratic funding. There's a lot of uh blockchain related organizations that are donating and then other people can also donate and then they match the donations using the quadratic funding algorithm. And then there's retroactive which means that first something was instead of people applying for grants and then doing it, they instead do the thing first and then get funding afterwards. And these have have a used smart contracts and programmable cash flows.

Give is one very famous one. It's it's using quadratic funding and matching. Gitcoin is also giving grants and then people can donate there and steer where the grants are going. uh there's sealer fund which is also quadratic funding but they are adding that they try to prevent subil attacks by also identifying the the funders using bright ID then there's the T protocol which unfortunately I noticed that the the app is no longer working so it's defunct but this was based uh

on um on doing basically page rank but for contributions and this was uh tracing down like what are the dependencies of the projects you are funding so that not only the main project you're funding is getting funding but also its dependencies merit systems was similar but unfortunately this also seems to be defunct at the moment and then there's drips network which is still operating But none of these are like gaining mass adoption.

And uh that's sad because uh blockchain would be ideal for this kind of distributed development. the open source and blockchain is a perfect match and we should have uh donation systems that are utilizing these unique properties of blockchain that it's all transparent. You can see how much money the recipients are getting. You can track with public key signatures who is the recipient and uh who is requesting for the donations. And it's easy. The costs for donating are low and also the cost for

setting up this is low. And uh I think the retroactive funding is the most uh viable thing and I'm because of this previous projects seem to be defunct. I think we need to come up with a new system and especially something that passes the walk away test that it's not dependent on one centralized organization to run run the funding system. And if you're interested in building something like this, then grab uh grab me by my sleeve or reach out to me at my email at debian.org.

Thank you. [applause] Thank you so much, Otto. That was interesting. And uh it seems like you explained everything very well. There's so far only one question. So lovely people, if you have any more questions for Otto, please scan the QR code over there and put your questions into Mircat. Now Otto, let's address the one questions that we already have here. How do you evaluate blockchain projects built around existing applications and real world demand rather than speculative adoption?

>> This is a difficult question. So obviously like there's a lot of speculative stuff in [snorts] in different ways going on and uh uh I don't know if at least these uh examples I showed that unfortunately seem to have gone defunct. They had a lot of VC funding. So whatever is like VC funding has a huge risk of of being like very speculative in their terms of adoption. So I hope we would see something that's more grassroots that's very cheap to operate and starts from near zero and then doesn't really depend on huge funding to stay around and

exist. Okay, thank you for that. So why do you think is going wrong with many of these projects getting defunded? I don't think they're really getting defunded. I think they got funding but then they didn't take off. They didn't get mass adoption and I think it's really hard to run a company like in general and then doing something that requires network effects obviously is like twice as hard and if you don't get the network effects you're failing and I think one problem here is that these blockchain these projects have like a crypto background and they started in crypto. We need to have a blockchain technology using funding system but that

starts from traditional open source and has the traditional open source background to get anywhere. >> Thank you very much for your questions and auto for your answers. [music]