$373.25 billion was given to charitable organizations in 2015 (2.1% of the world’s GDP).
What if we could make charitable giving more efficient? Or better yet, what if we could increase the amount donated even a fraction of a percent?
Trust in charities is at all time low. According to a recent report produced by Populus for the UK charity commission, this lack of trust is centered around three key issues: accountability, management and fundraising. 67% of those questioned thought that charities spend too much of their funds on salaries and administration, up from 58% in 2014.
Charities have a public image problem, reflected in increasingly critical media stories. Who can forget the Red Cross scandal, where dozens of trucks were driven around empty — “just to be seen” — during the aftermath of Superstorm Sandy and Hurricane Isaac?
With Ethereum, we have the ability to create a decentralized governance structure while providing full transparency and accountability on giving.
Earlier this year, The DAO demonstrated a huge interest in the experimental concept of decentralized governance (~10–15k users giving circa~ $150M). It failed due to a bug in the software, but nevertheless, it attracted mainstream media attention. Countless articles have been written about the concept, the game theoretical challenges, shortcomings and security improvements that could be made to the code.
We want to use the knowledge and the experience learned from this experience to create a Charity DAO. The Charity DAO will have a very narrow focus. It will be strictly not-for-profit and will only spend its funds on charitable causes.
The donors stay in full control of the funds and vote on which projects will get funded, either directly or via a nominated delegate.
These projects — approved by a set of trusted curators — will commit themselves to a payment schedule laid out in smart contracts (e.g., monthly disbursement with the ability for the charity DAO to halt payments in the case of missed deliverables).
And because all of this will be executed on the public Ethereum blockchain, it will stay completely transparent.
There are already several initiatives working in this direction (Giveth, benefactory.cc, alice.si, WeiFund). They are all important pieces of the puzzle. We will closely cooperate with Giveth to tie all of our efforts together, while focusing our attention on decentralized governance, developing the workflows and the smart contracts behind this Charity DAO.
This is a fully open source project and we invite everyone to join the effort: coders can already contribute at https://github.com/slockit/DAO while discussion will continue on the now revamped community slack, channel #charityDAO.
We are looking forward to building the future of charitable giving together, in order to use this revolutionary technology for helping those who need it the most.
For more information please visit http://charity-dao.org/