autopgf
Loading...PIONNERED BY MAREK OLSZEWSKI,
GLO DOLLAR
AutoPGF (Automated Public Goods Funding) is a set of mechanisms that fund public goods automatically, such as through yields generated from protocol or token interactions.
Coined by Marek Olszewski in 2024, AutoPGF simply means automatic public goods funding. AutoPGF utilizes revenue from network activities to support ecosystem development. The idea gained traction as projects like Glo Dollar (a stablecoin that uses its yield to fund public goods) or Octant (a group of ETH stakers that distribute their funding to public goods) began to appear and grow.
AutoPGF creates a funding flywheel where protocol usage directly supports public goods, aiming to address sustainable funding challenges in blockchain ecosystems. It enables users to indirectly contribute to ecosystem growth through their regular onchain activities.
This mechanism is ideal for blockchain protocols and decentralized applications (dApps) that want to contribute to ecosystem growth and sustainability. It’s particularly suited for protocols with consistent user activity and revenue generation.
AutoPGF channels a portion of protocol revenue directly to public goods projects. This revenue comes from normal user activities. The key idea is creating a feedback loop: as public goods improve the ecosystem, more users engage with the protocol, generating more funding for public goods.
AutoPGF generates revenue through fees or yields as users interact with the protocol (trading, staking, etc.). Instead of becoming profit, a portion of this revenue goes into a treasury for ecosystem public goods funding.
How is this capital then allocated? While this varies, a common construction is that the community, often token holders, votes on which projects to fund. This process happens automatically, creating a link between protocol usage and ecosystem development. Users support public goods simply by using the protocol, without additional costs. The system aims to create a sustainable funding cycle: more usage leads to more funding for public goods, potentially driving further protocol adoption.
AutoPGF automatically directs a portion of protocol yields or fees to public goods funding, eliminating the need for manual donations.
The amount of funding for public goods scales directly with protocol usage, creating a self-reinforcing ecosystem growth
mechanism.
Token holders or community members can participate in deciding which projects receive funding, aligning resource allocation with ecosystem needs.