InfoFi Domain - GG24 Sensemaking Report

[vaughnmck]

tl;dr

Goal: Deploy crypto-focused information markets (excluding sports/politics) that generate over $1M in volume, establishing Ethereum as the hub for information finance.

Ask: Run a Market Discovery Program using Butter to subsidize 10-15 experimental markets (prediction, advisory, decision, funding, etc.), identify what works, then scale winners to create replicable templates for the ecosystem.

Problem & Impact

OpenAI, Anthropic, and Google increasingly mediate how society accesses and interprets information. Truth is becoming dangerously cheap to engineer.

The 2024-2025 period marks an inflection point. ChatGPT and Claude are becoming the primary information interfaces for millions, bots overrun most social media feeds, and elections face broad misinformation campaigns. Meanwhile, Ethereum has matured enough to consider building alternatives.

The evidence for information finance (InfoFi) as a solution is compelling. Polymarket’s $16B+ cumulative volume demonstrates demand for truth-seeking mechanisms. Most importantly, information markets address the root cause of our information crisis: misaligned incentives.

Traditional media optimizes for engagement and advertising revenue, not truth. InfoFi creates markets where accurate information pays, transforming truth from a public good into a profitable venture. That users continue to return month after month to these platforms, finding value years after launch, gives us reason to believe we’re addressing a real problem.

Sensemaking Analysis

Our analysis draws from our own live experiments.

The Optimism Futarchy Experiment (March-June 2025) allocated 1M OP tokens—500K OP using our Conditional Funding Market, and 500K OP through the Optimism Grants Council—generating remarkable results: the futarchy cohort achieved $61.50 in net TVL per OP compared to $0.28 for the Grants Council—a 219x improvement in capital efficiency.

The Uniswap Foundation’s Conditional Funding Market provided additional validation. Their $100K allocation to Morpho generated $77.8M in incremental TVL over just 30 days.

Our approach combines quantitative TVL analysis tracked through DefiLlama, comparative performance metrics across cohorts, and time-series monitoring of daily patterns.

We build on research by pioneers in the field of information markets: Robin Hanson (Inventor of futarchy, George Mason University), Yiling Chen (Harvard), and Bo Waggoner (University of Colorado).

Our work builds on Vitalik Buterin’s November 2024 InfoFinance article, which defines our mission: improving prediction markets and information-aggregation tools.

Gitcoin’s Unique Role & Fundraising

Gitcoin is uniquely positioned to spearhead the InfoFi revolution. Seven years of funding $60M+ in public goods created the trust and infrastructure that information finance needs. Gitcoin pioneered Quadratic Funding and has publicly acknowledged its limitations, demonstrating the intent to find better mechanisms.

Our fundraising strategy leverages proven results. We’re in active discussions with the Ethereum Foundation, building on their renewed focus on ecosystem growth.

Success Measurement & Reflection

Our goal is to deploy a catalogue of crypto-focused information markets that do not include sports, politics, or price action, and generate $1M+ volume across all active markets.

We’ll track forecast accuracy (comparing predictions to actuals) and user retention, and monitor for fraud, e.g., wash trading. We’ll introduce a mechanism for the community to contribute to the market selection process.

The Ethereum community will celebrate this domain when a respected media organisation references information produced by Ethereum’s InfoFi markets, just as they default to Ethereum for DeFi today. Specific markets might include “Will EIP-4844 reduce L2 costs by >50%?”, “Which L2 will have the highest TVL in 2026?”, or “Which research areas will produce the highest number of conference acceptances?”

By February 2026, success means media coverage acknowledging Ethereum as the hub of information finance, with over 80% of non-sports/elections InfoFi volume occurring on Ethereum/L2s, and at least one major institution using or referencing these markets.

Domain Information

Domain Proposal: The InfoFi Domain for GG24

Domain Experts: The Butter founding team brings deep operational expertise from running successful experiments generating $100M+ in TVL impact. Our advisory board includes Robin Hanson, Yiling Chen, and Bo Waggoner.

Mechanism: We’ll use Butter, our own InfoFi venue. All allocation decisions derive from transparent, public market data.

Structure: Rather than funding rounds, we’ll run a Market Discovery Program. Phase 1 deploys 10-15 subsidized information markets (prediction, advisory, decision, funding, etc.) across technical (EIP impacts), ecosystem (L2 adoption), and governance (DAO decisions) categories. Phase 2 refines based on participation signals. Phase 3 scales the 3-5 breakout market types toward our volume target.

Our subsidy strategy includes initial liquidity provision ($5-10K per market) and trading incentives for accurate forecasters. Success means discovering which information markets the Ethereum ecosystem genuinely needs and will sustain beyond subsidies. This creates templates we can replicate, cementing Ethereum as the permanent home of information finance.

[owocki]

Draft Scorecard

2025/08/18 - Version 0.1.1

By Owocki

Prepared for Vaughn McKenzie-Landell (Butter) re: “InfoFi Domain - GG24 Sensemaking Report”

(vibe-researched-and-written by an LLM using this prompt, iterated on, + edited for accuracy quality and legibility by owocki himself.)

Proposal Comprehension

TITLE
InfoFi Domain - GG24 Sensemaking Report

AUTHOR
vaughnmck (Butter)

URL
https://gov.gitcoin.co/t/infofi-domain-gg24-sensemaking-report/23038

TLDR

You want to run a Market Discovery Program on Butter that seeds 10 to 15 crypto-focused information markets, learn what sticks, then scale the winners so Ethereum becomes the hub for information finance. Success looks like 1m+ in combined market volume across non-sports, non-election markets and visible usage by respected institutions and media by early 2026.

Proposers

Butter founding team led by Vaughn McKenzie-Landell

Built and shipped Conditional Funding Markets used in live experiments with Optimism and Uniswap Foundation; Vaughn is CEO and cofounder of Butter.

Domain Experts

Robin Hanson, Yiling Chen, Bo Waggoner

Hanson originated futarchy and has deep prediction-market scholarship; Chen is a leading Harvard researcher on prediction markets and mechanism design; Waggoner coauthored recent work connecting CFMMs and prediction markets.

Problem

Information quality is degrading as LLMs and social platforms shape attention. Incentives for truth are weak. InfoFi reframes truth-seeking as a market with aligned incentives. Polymarket’s cumulative volume suggests demand for market-driven information, but Ethereum lacks mature, reusable templates beyond elections and sports.

Solution

Use Butter to deploy subsidized information markets around Ethereum-native questions and decisions, track measurable outcomes like forecast accuracy and user retention, compare cohorts against baseline allocations, and scale templates that show organic traction post-subsidy. Leverage lessons from Optimism’s futarchy contest and Uniswap Foundation’s conditional funding pilot.

Risks

1. legality and policy risk. Real-money prediction markets in the US can trigger regulatory scrutiny. Even if markets avoid elections and sports, some constructs may look like event derivatives or futures. You address fraud and wash trading, but you should also outline compliance and geofencing assumptions up front.
2. subsidy dependency. Markets seeded with 5–10k liquidity and trading incentives may show early volume that doesn’t persist. You should predefine “post-subsidy” health metrics and a hard ramp down schedule.
3. which markets are we deploying to? will they be ones people actually care about?
4. KPI selection risk. If you optimize around TVL or single metrics, you risk Goodharting. For each market type, specify the ground truth oracle, resolution criteria, and anti-manipulation guardrails.
5. data integrity and attribution. Claims like “$X incremental TVL” need rigorous counterfactuals and transparent methodology. Commit to public methods and reproducible datasets, not just screenshots.
6. delivery risk by October. Ten to fifteen high-quality markets with clear oracles, liquidity, and outreach is a lot in a short window. Focused verticals and precommitted partners will make or break it.

Outside Funding

You note active discussions with the Ethereum Foundation and prior collaboration with Uniswap Foundation and Optimism, but the thread doesn’t list secured co-funding for this GG24 domain. Clarify committed dollars and counterparties.

Why Gitcoin?

Does Gitcoin have something unique to offer here?

Yes. Gitcoin’s brand in public goods and mechanism design gives legitimacy and distribution. The community can help discover where InfoFi delivers real value beyond hype, and Gitcoin can host open playbooks for repeatable market templates across domains. This builds on Gitcoin’s willingness to move beyond quadratic funding where it isn’t fit-for-purpose.

Owockis scorecard

#	Criterion	Score(0-2)	Notes
1	Problem Focus – Clearly frames a real problem, (one that is a priority), avoids “solutionism”	2	Problem is crisply framed: misaligned incentives for truth in an LLM-saturated info ecosystem. Concrete Ethereum-native angles.
2	Credible, High leverage, Evidence-Based Approach – Solutions are high-leverage and grounded in credible research	2	Builds on published experiments and academic groundwork; commits to measurable outcomes and public data. Needs tighter methodology commitments.
3	Domain Expertise – Proposal has active involvement from recognized experts	2	Strong advisory bench and a team that has shipped live pilots.
4	Co-Funding – Has financial backing beyond just Gitcoin	1	Prior partners are strong, but current round’s external dollars aren’t confirmed in-thread.
5	Fit-for-Purpose Capital Allocation Method – Methodology matches the epistemology of the domain	2	Markets to discover signal, then scale templates is appropriate; emphasis on oracles and resolution improves epistemic fit.
6	Execution Readiness – Can deliver meaningful results by October	1	Butter exists, but 10–15 quality markets is ambitious; recommend narrowing scope and pre-booking participants.
7	Other - general vibe check and other stuff I may have missed aboev…	2	Vision is compelling; success hinges on execution.

Score

Total Score: 12 / 14
Confidence in score: 70%

Feedback:

Major

• decide what markets people will actually care about and put wood behind that arrow. maybe narrow down to 3-5 good ones.
• narrow to 3–5 market archetypes for October with named partners and precommitted liquidity so depth and resolution quality are high from day one.

Minor

• show the exact post-subsidy runway. Specify when incentives taper and what retention targets trigger scale-up vs shutdown.
• outline compliance and user access assumptions by jurisdiction to reduce uncertainty for co-funders.
• add a public pipeline of candidate markets with a lightweight intake form so the community can propose ideas that meet your criteria.
• publish a rigorous measurement and resolution framework now. Define per-market KPIs, oracle sources, manipulation checks, and your counterfactual method for “incremental impact.”

Steel man case for/against:

For

InfoFi turns truth-seeking into a paid, composable primitive that Ethereum can own. Early pilots suggest capital efficiency benefits over committees. If we find 3–5 repeatable templates, the domain could unlock better grant allocation, roadmap forecasting, and governance decisions across the ecosystem.

Against

Prediction markets face policy friction, and many markets die without subsidies. If methodology is loose or KPIs are gameable, we risk noise masquerading as signal. Community trust could erode if “markets decide” becomes a meme without demonstrated accuracy outside a few handpicked cases.

Rose/ Bud/Thorn

ROSE
Clear, timely problem and a credible path to Ethereum-native solutions. Strong team and advisors with real pilots to build on.

THORN
If we do this, will anyone care? We should chose markets ppl will care about.l

BUD
A small set of high-signal templates for funding, advisory, and governance markets could become shared infrastructure across L2s and DAOs if you lock in methods, partners, and playbooks this round.

Feedback

Did I miss anything or get anything wrong? FF to let me know in the comments.

[deltajuliet]

Welcome @vaughnmck!

Evaluated using my steward scorecard — reviewed and iterated manually for consistency, clarity, and alignment with GG24 criteria.

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Submission Compliance

• Full structure is present: problem, sensemaking, metrics, domain info
• Sensemaking is focused on internal experiments (Optimism + Uniswap pilots), not the broader InfoFi ecosystem
• No co-funding confirmed
• Proposal scope is ambitious (10–15 markets in 6 months), and execution dependencies aren’t fully addressed
• Verdict: Compliant, but somewhat centralized and potentially over-scoped

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Scorecard Evaluation

Total Score: 11 / 16

Criteria	Score	Notes
Problem Clarity	2	Frames the truth-misalignment problem well and positions Ethereum with urgency
Sensemaking Approach	1	Internal pilots are solid, but no external scan or ecosystem mapping — no signal from Polymarket, Omen, or failure cases
Gitcoin Fit	2	Gitcoin as host for discovery of new mechanism types makes sense
Fundraising Plan	0	No named funders, no matching, no in-kind support listed
Capital Allocation Design	1	Mechanism is clear (Butter + retro), but single-platform raises neutrality concern
Domain Expertise	2	Butter team is experienced; named advisors are serious credibility (Hanson, Waggoner, Chen)
Clarity & Completeness	2	Structured, focused, and tightly written
Gitcoin Support Required	1	Would need Gitcoin to support fraud monitoring, metrics validation, and help set neutrality guardrails

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Feedback for Improvement

Where I agree with Owocki:

• You need to cut scope. Ten markets is a stretch. Start with 3–5 that land signal early.
• Clarify how markets are chosen and who owns that process.
• Spell out post-subsidy metrics and exit conditions so this doesn’t become a ghost round.

What I’d add:

• Right now, this funds Butter’s roadmap. If this is a domain, show how it includes or benchmarks against other tools (e.g. UMA, Omen, Zeitgeist).
• Governance isn’t defined — who curates markets? Who validates oracles? Who handles resolution disputes?
• Potentially add one matching partner (EF, L2, or private funder) to reduce the optics of a product-led round.

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Without clearer guardrails, it risks turning Gitcoin into a distribution channel for a single product without sufficient neutral framing or broad community input.

Would support if:

• Scope is reduced to 3–5 markets with clear rationale
• A public pipeline and resolution rules are published
• Governance and reviewer neutrality are defined

[vaughnmck]

Thanks for the feedback @deltajuliet @owocki.

Overall, agreed with the points. We’ll share an updated version shortly.