The Commons Stack: Scaling the Commons to Re-Prioritize People and the Planet

Kris Decoodt
Aug 29, 2019 · 11 min read

Update 01/2020: The Commons Stack is moving full speed ahead, to stay up-to-date, subscribe to our Commons Stack Medium!

This is a transcript of @jeffemmett’s presentation on the Commons Stack, the closing session at the Token Engineering Global Gathering (TEGG) in Berlin on August 23. Article transcribed by Don Adams, edited by @krrisis, with added links for reference.

View the slide deck, the full live stream and presentation

Why the Commons?

It’s first good to establish: why are the commons important? We have some really big issues on the horizon that we can only solve together: climate change, resource depletion, open source incentivization — these are all public goods that are prone to the free-rider problem. This problem applies just as much to the extraction of environmental resources as well as the funding of writing open code. It’s a coordination problem that underlies some of the biggest problems we face. Ostrom and others have suggested that we need larger-scale coordination mechanisms for making rules to determine how we use and allocate existing resources. We have some of these coordination tools already, but our current approaches are flawed. Our current global coordination mechanisms — both markets and states — are dealing with quite some challenges. We have one-dimensional economies that optimize for profit and exclude people and the environment from their calculations. We have outdated governance structures that are reactive to the problems we seem to be creating for ourselves, rather than being proactive in solving them. They don’t seem up to the task of responding to new problems fast enough to keep up with the speed at which they’re emerging. We have a lack of global cooperation around the resolution of these problems, which leads to a breakdown of coordination on a global scale. We have nations coming together to resolve climate change, but country A won’t commit to carbon reduction measures because country B won’t do it first, and vice versa, until we wind up in this stalemate where very little gets done and climate change only gets worse — the tragedy of the commons writ large.

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But there are solutions out there in cooperative structures: communities come together around shared goals (the commons) and value their local communities and environments. They have their own non-hierarchical governance structures and decision-making processes. These are great solutions, but they have a problem. They rely on trust, which today is person to person — this doesn’t scale. So how can we scale this trust and these coordination mechanisms to apply commons-type solutions on a global scale?

Scaling Trust With Blockchain

This is essentially what the Commons Stack is trying to do. We’re trying to scale trust using the blockchain, and we’re trying to scale the commons with these tools that we’re building. We’re creating an open-source library of components that enable purpose-driven communities that are united around any cause, whether it be cleaning up trash or planting trees or producing open source components for the betterment of humanity, and we’re giving them the ability to raise money, make decisions about how to spend it, and to measure impact.

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This tech stack for the commons will include tools for varying methods of governance, funding, proposals, simulation and initialization. These are modular, interoperable components, so any project can take the pieces that are relevant to their community, customise them to their specific needs, and combine them into a token network . This could be considered an SDK for DAOs, so you can take any of these components, interoperably combine them and launch your token network around your community goals. This is a future vision of the Commons Stack, so let’s look at where we’re going to start today.

A Minimum Viable Commons

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So the important thing to note about the Commons Stack is that it has a rigorous token engineering foundation. This is not based off an idea in a whitepaper, it’s based on solid token engineering research and built with tools and processes like cadCAD. Each of these components will be modeled based on mathematical-first principles, then we test them and only then do we start implementing them. We’re producing a library of robustly designed components that can then be forked and used in any commons initiative or open source project, and anything we learn from those live deployments are an opportunity to collect data and improve our model. We’re turning this into an engineering design process which will revolutionize the entire crypto industry.

Jeff Emmett presenting at TEGG in Berlin, view the slide deck and all links here

Complex system design is complex. To build these components, we start by defining mathematical conversation laws, then we model these systems in token circuit diagrams and simulate them to understand where their systemic failure modes may lie before we even write our first line of code. The great thing is that you don’t have to do this modeling, you can just use Commons Stack components, knowing that this robust design is already baked in.

Sustainable Funding: the Augmented Bonding Curve

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First, the Hatch phase: the community comes together and funds an initiative they believe in. That money is split according to some agreed-upon percentage into the funding and collateral pools, and then you are issued a dual-purpose token, which is both a claim to one part of the collateral pool (you can burn it for some collateral) and it provides you with governance rights over the funding pool (you will be able to vote on how the funds are used). Note that this is not a time graph, it’s the amount of money people put into the bonding curve, so it can go up or down depending on people’s behavior. It’s not a magic money-making machine.

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Next, the Open phase: as the price goes up people may want to sell their tokens to reclaim the collateral backing them. As more and more people exit the economy, though, the people who are left have all the governance over the funding pool. Then others who want to share this decision making power will buy-in, exerting an opposing buy pressure against those selling. The interplay of these forces creates market volatility within an acceptable range, which generates funds for the funding pool via an ‘exit tribute’. Every time someone sells their tokens, some percentage of the value that it represents is taken from the collateral they get, and deposited into the funding pool to pay for more work in your community.

To recap the Augmented Bonding Curve: we’re creating circular, regenerative economies that can be used by anyone, any community, any cause or open source project that wants to coordinate around a goal. We have incoming capital that gets split between the funding and collateral pool, we have funds flowing from the funding pool to complete proposals and provide value to the community and perhaps the world at large, and you have exiting capital which creates this circular flow from the collateral pool into the funding pool, so that you get sustainable funding into your community.

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Augmented Bonding Curve Simulation

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Ecosystem-Funding DAOs

There are other challenges we can tackle with ecosystem-funding DAOs too. There’s no accountability right now over allocated funds, there are on-chain voting issues all throughout the space, and a lack of impact measurement, it is difficult to trace whether our money spent has the intended impact. Solving these problems is the roadmap of the Commons Stack, each of these challenges, one by one, and synthesizing them into an easily forkable ‘Minimum Viable Commons’ to move forward with and bring us into an age of decentralization.

Token Engineering Commons

We’re going with an old school, tranche-style raise to fund the development of each component in this system. We are excited to think that once we build this system, such old-school style raises will never again be necessary, because we will be able to use the Commons Stack as a sustainable funding mechanism to raise money for similar OS software and community endeavors.

We’ve broken it down component by component to be synthesized in the last step into a ‘Minimum Viable Commons’. We’ve gotten here through contributions of labor and finances and we’re more than open to contributions from the token engineering and blockchain communities, because we’re excited to start building these components as soon as possible. We have ideas, we have tested our assumptions, run simulations, and now we’re going to get down to building these OS tools for the community at large. We have a dedicated team with decades of experience in this and relevant fields, we have some of the top token engineering advisors giving us their wisdom and expertise, and ensuring that we’re moving forward in the most circumspect way as we build these components. We have a strong legal team that’s looking at the future legal framework of DAO ecosystems because this is also an important entanglement that we need to keep our eye on.

We are here today to ask you to join the Commons Stack community: help us help you to realign our economies and re-prioritize people and the planet.

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Open-Sourcing cadCAD

So jump into the repo, have fun, and join the Commons Stack community. We want to coalesce a community of people who want to use token engineering and practices to push this discipline to a greater level of maturity so that we can all tackle the biggest issues of our times, together.

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Kris Decoodt

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Our vision is a world where giving is effortless and people all around the world are rewarded for creating positive change.