Sourcecred
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SourceCred functions as a governance mechanism by assessing individual contributions and distributing rewards based on the effort, complexity, and impact of those contributions.
It was conceptualized in 2017 and introduced in August of 2019 during an initiative called the CredSperiment, which aimed to provide a trial run of the technology to see if it could provide transparent and relational tracking of contributions based on intersubjective quality rather than quantity. Today, SourceCred is a series of plugins to measure contri- butions and allocate rewards.
This mechanism is ideal for DAOs, community managers, and project managers seeking to directly reward contributions based on their impact on the underlying project. It’s additionally beneficial for those concerned with Sybil resistance, as it employs multiple strategies focused on transparency and easy community oversight.
The SourceCred strategy involves distributing Grain, a tradeable community token, to contributors based on the number of non-transferrable Cred tokens their contributions have earned. This is done using a neutral framework that assigns scores and distributes tokens accordingly.
SourceCred uses an algorithm to determine the value a contributor adds to a project. This algorithm includes customizable plugins for community-specific moderation, and it operates transparently on publicly accessible data without storing community information. When a contribution is made, SourceCred attests to it and assigns an amount of “cred” based on its value to the project. This cred flows from the contribution to all the people and other contributions that supported it.
In the SourceCred mechanism, a project is repre- sented as a node graph of contributions and people. The nodes are connected to allow Cred flow between them based on the support relationships between different contributions. The more connections a contribution has to other contributions in the project, the more opportunities it has to receive Cred. This structure provides a visual and measurable representation, known as the Cred Score, showing which contributions are foundational and which support future work within the project.
The SourceCred algorithm also uses “weights,” a set of rules that determine how much Cred different types of contributions are worth. Each community can decide the weights for its Cred distribution, allowing it to define what it values most and which actions reflect those values.
Since Cred is non-transferable, it cannot be bought or sold, preserving its integrity as a measure of contribution. However, Grain, a community currency tied directly to one’s Cred, can be exchanged. Grain is minted and distributed to contributors based on the Cred they have earned, allowing it to be transferred both within and outside the project.
The SourceCred system visually represents value capture within a project, allowing stakeholders to see what, where, and how value is generated.
By highlighting where the most value is generated, SourceCred can inform decisions about resource allocation within a project by directing efforts and support to areas and contributors that demonstrably create the most value.
Tracking and analyzing individual contributions for their impact offers stakeholders a straightforward understanding of how each input contributes to the project’s overall success and progress.