What if users could donate with credit card to Gitcoin campaigns?
This would more than 100x the reach from EVM L2 users to all credit card users (billions of people.)
How it would work
A user creates an account on the viaPrize.org platform and adds Gitcoin projects to their cart to fund. In essence, we would test this out with our front-end just being one more way to access Gitcoin projects so Gitcoin doesn’t need to make any big changes before seeing results. (To create an account, we use Privy which creates a wallet for a user with account abstraction with simply an OTC sent to an email, so web2 people can easily do this.) Then…
- The user types in how much they are donating
- They sign permission for us to send that amount of an ERC-20 stablecoin from their wallet
- They are taken to a Stripe credit card checkout page which has that amount they are donating pre-filled so they just click send
(From the user’s perspective, they are done. Here’s what happens next internally…) - The fiat funds show up in our Stripe account, and we turn it into USDC for example with Circle mint
- We send the USDC into the user’s wallet, and since we already have their permission to send that amount out of their wallet, we immediately send it to the projects they are donating to.
In this way, the user has on-chain history of their donations even though they donated with credit card.
Why do this instead of an onramp?
Check out this ad from Onramper on my LinkedIn feed from when I and the viaPrize team were testing several onramps:
A 52% increase of fiat-to-crypto transactions succeeding from 22% equals… 33%? If I did that math right, then still 2/3 of all attempts to onramp fail through Onramper which is an aggregator offering many onramps (btw Onramper is hard to work with and we honestly feel kinda scammed into spending money on them. Shoutout to Guardarian/ChangeNow for working well so far)
And that’s if the user is even willing to sit through the process of doing KYC if this is their first time buying crypto.
Compare that with the proposal to: have users send fiat, then we convert that into crypto for them with a trusted solution that works consistently.
Background
At Zuzalu last year, I started testing out crowdfunded prizes as a concept with an MVP for viaPrize. (Details here: Gitcoin Appreciations Thread)
Since then, a team of five has come together with 100% of our funding so far coming from Gitcoin donations.
We made a tiny bit of revenue in January with some paying users, but to be honest have been slowed down since then spending months talking about how to make web3 easier to use. We think we may finally have found a strategy that addresses this (we already built USDC based contracts so it is a familiar currency, gasless transactions, and ability to send funds to usernames instead of public keys, full roadmap here: viaPrize Development Roadmap - Google Docs )
It is thanks to Gitcoin that we exist, and we would love to build something that gives back to the community and pioneers a way for many web3 platforms to be easier for web2 users to interact with.
Pilot Project
For this system to work immediately, we need a “buffer reserve” of funds (see “deep dive into issues” below for an explanation.)
We are suggesting a pool of $10,000 be available in the upcoming Zuzalu Gitcoin round so that users may be able to donate up to $10,000 total to projects in that round with credit card.
If this works well, we can expand this to more rounds, and perhaps viaPrize even creates vpfinance - a b2b saas consultancy that works with web3 platforms to make them easier for web2 users to interact with.
Deep Dive into Issues (For Nerds Like Me)
To send fiat from Stripe to a minting service, a wire transfer will take around 3 business days. We are looking into sending from Stripe to a bank account (which adds a different few days wait unless we pay 1% fee for instant stripe withdrawal) then manually buying crypto in an exchange (there’s no APIs to automate this) or use CBIT transfers or Hong Kong’s special real time gross settlement (which would require opening a Hong Kong company.)
But if those fall through, basically we need to have a “buffer reserve” so we can immediately send the crypto upon receiving the fiat, and that buffer is replenished once the fiat we received has finished turning into crypto.
There are many more considerations, some of which we have simplified in this blog post: https://www.noahchonlee.com/post/how-to-bring-credit-card-payments-to-web3-crowdfunding-platforms
The most important tradeoff is that we COULD use dev-controlled wallets and do everything on behalf of the user at the cost of the user giving up sovereignty of their wallet (this would remove the need for users to click “sign” with a wallet pop up which might confuse people unfamiliar with web3.)
We would still keep the option for people to use their own self-sovereign/non-custodial wallet, but if someone just wants things to work easier they could select “normal account” instead of a “web3 account” when creating their profile.
Funding for This Project
We see 3 ways this could be funded:
- A proposal and DAO vote to make a prize for someone to build in credit card payments to donate to Gitcoin campaigns (which we anticipate winning, but at least it’s an open invitation then and it is a results based reward system, and there’s another prize on our platform
) - The community appreciates our work and donates more to us during GG rounds (and maybe in the citizens round?)
- We make revenue through a platform fee (we are thinking 5% flat fee, 2.9% of which goes to the credit card fees and potentially 1% goes to Stripe instant payout fee which leaves 2.1%-1.1% for us)
We would prefer all three, and would love feedback from the community on what they think is reasonable.
Conclusion
Gitcoin is making big changes!
Congrats to the switch to the new cluster based matching and model based detection strategy that removes the need for Gitcoin passport stamps!
See @umarkhaneth great article on that and cheers to him encouraging me to write this: Our Sybil Resistance Strategy for GG20
This change combined with credit card payments may make it orders of magnitude easier to donate and receive matching.
This could be the start of an even brighter era for Gitcoin, QF, and web3 crowdfunding at large.
What do you think? 
support this idea, it makes so much sense…
