The launch of PGN was a feat that came together quickly, and with an incredible amount of support from the community, our partners, and from Gitcoin. I / We are immensely grateful for the time and effort everyone spent in helping us first shape our thinking, and then work to launch and sustain the network. After reviewing a number of key metrics (usage, incentives, cost, staffing, etc.) we have decided we are going to be winding down the Public Goods Network over the next 6mos (network shutdown tentatively planned for June of 2024). This decision is a hard one for us and not the outcome we anticipated, however it feels right after taking a realistic assessment of the project. We have plans we will share soon on how we plan to shut things down in an orderly manner. We also feel it is best to showcase where this experiment was successful and where there were failures. Read on for more details.
PGN was conceived as the network that funds the world’s public goods. By building an alliance of public goods supporters, we could move network traffic to PGN so that low cost Tx fees would offer funding for public goods projects and supporters. The unique selling proposition of PGN was based on launching Contract Secured Revenue (CSR), and the appeal of directing sequencer fees to fund public goods. We felt there would be enough interest in CSR to drive development and adoption of the network (ie, people deploying smart contracts) all while it would be steered by an alliance of public goods supporters to help us govern the surplus of funding. Through the six months of building post-launch, what we learned was that:
- CSR was not a viable technology to integrate given the law of chains and requirements to maintain parity with Bedrock (for valid reasons)
- Convincing people to migrate network traffic without the convenience of a scaled network was not possible
- Low liquidity on bridges (cannot move large Tx volumes on stables or other tokens), lack of DEXs, missing core components like a Safe UI, etc. all caused large headwinds.
- Without promise of a future airdrop (we didn’t want to do a token… and OP governs the superchain), we saw far less traffic than other emerging L2s who likely will do a token.
The network was intended to be larger than just Gitcoin. In fact, the Gitcoin Foundation / I decided to bootstrap the funding of this initiative so that the Gitcoin DAO did not need to take on any of the financial cost or work associated with launching and maintaining the network. What we learned was that:
- Gitcoin wanted to be involved, and I should have included them in the decision making process. This decision to fund the network this way caused frustration and eroded trust within Gitcoin.
- The cost / revenue estimates we initially made with OP have not borne out. (ie, the network is more expensive to operate than expected.)
- The Alliance has been terrific but has not driven much Tx volume as they dont have the same dApp / Protocol usage that Gitcoin has during Grants rounds.
- There was confusion on how the Tx volume would be filled - OP felt this would be an App chain for Gitcoin and we wanted this to be an ecosystem chain like Base.
By having a network live and focused on public goods, we were able to bring many of the best public goods projects together to explore how we might expand and grow funding. For Gitcoin, having a “default chain with financial upside” gave us leverage to raise additional funds for public goods (e.g., Polygon sponsoring the Eth Infra round for us to run the round on Polygon instead of on PGN). We learned that L2s are generally interested in supporting public goods, and want to support a community of builders. Giving them incentive to fund rounds on Gitcoin is positive for both ecosystems.
We learned an immense amount about how to launch, grow and scale a L2. We had interest from those who wanted to run validators and RPC nodes, we had immense support from the community in adopting and validating PGN as a legitimate L2 option on bridges, insight dashboards, core infrastructure (like the Graph Protocol, etc.). Partnerships and support from Zora, Base, OP, jokerace, Layerswap, Hats Protocol, Guild, Goldsky, Superbridge, Hop Protocol, LayerZero, have been incredibly generous and we want to thank them for all of the time and effort they have spent with us.
We were able to meet and work with some really awesome, intelligent people. PGN brought Nicole, Sophia, Dan and others closer to our ecosystem. Finding really great individuals to partner with on an initiative as large as PGN can often be daunting. Having Nicole lead so much of PGN has been such a joy to watch and participate with.
The Gitcoin team has risen to the occasion and really supported PGN from day one. The brand work by folks on MMM, the NFT drops, the engineering team (Grants Stack and Allo!) supporting the deployment of stable coins, bridging and other core infra has been immensely valuable. PGN gave us a fun sandbox to build a new brand identity and really showcase Gitcoin’s skills in going from 0 to 1.
Work has been done to map out what would need to be true for PGN to be successful, and the reality is that the list is quite large, and the capital required is also significant (and not something the Gitcoin Foundation can absorb on its own). It was through the review of these requirements, and also evaluating the current appetite Gitcoin has to lead this initiative, that we have decided to shut down the network.
If there are others that would like to financially support this initiative… perhaps take over the network, please get in contact. As currently planned, PGN will be sunset (lights out) in June of 2024. We will offer more details as we get closer to that timeline. In the meantime, we plan to disable bridging onto PGN, and would encourage folks to bridge assets off PGN as they need them. See our documentation (docs.publicgoods.network) for bridging options and reach out in our Telegram with further questions.
Thank you so much to everyone who rallied around us to make PGN what it is today. I still believe we are in a race to the bottom where sequencer fees are one of the most sustainable sources of funding for public goods. As more and more L2 ecosystem’s grants programs evolve, there may just be enough funding to sustain our innovation for a while to come.