In my Gitcoin Grants Citizens Round application, I wrote how we could use design principles from Elastic Decentralized Finance to promote funding of Public Goods by creating a #DeSci or Gitcoin Allo specific “stablecoin.” This post elaborates a bit more on that suggestion.
On the introductory Gitcoin Citizens Round Twitter Space, I had the opportunity to thank the many valued members of our community for your contributions. 254 donors at the time of this posting! thank you all very much. And as I was about to be given the mic to talk about my project, the notice to limit a 2-minute pitch was announced So I had to scramble, and I decided to ramble while verbalizing the word “Rotation” as much as possible because the rotating conveyor belt design is at the Heart of the Archimedes’ Lever.
What I should have said is this:
the Archimedes’ Lever is a Coordination Game that leverages Triple Entry Accounting for the aims of onboarding new users to web3 while simultaneously Decentralizing Science by Decentralizing Governance over the Scientific Process.
With respect to “Rotations,” describing the metaphor of a 4-stroke engine or the flow of Dopamine through Cortical-Striatal-Thalamic loops in the Nervous System doesn’t exactly articulate the concept in a manner that is receptive and easy to process (image below). America (1920s) is associated with the Roaring 20s arc which is likely to rhyme this decade.
So I have summarized the ideas in this article titled Split, Stack & Churn: Stabilizing Value with Rebase, Tranche, & Rotations in Decentralized Finance.
I believe that if & when we grasp these concepts and the engineering first principles of this system design, we can extend the inputs from the center (presently AMPL) out to the periphery (e.g., BTC, ETH, GTC, NFTs like Hypercerts).
The Traditional Finance System can be conceptualized as a game of hot potato which is passed around until the music stops, and the bag-holders of this hot potato (risk) are wiped out. It’s a Zero-Sum Game. When this happens on-chain, Information Asymmetry is minimized and we can effect Collective Non-Zero-Sum Outcomes. Pragmatically, for instance, we can tranche GTC & Hypercerts (Proof-of-Work of Positive Impact) together and design such a rotational system. So long as we can configure inputs in a timely manner to sustain the momentum of the rotating collateral set of tranches (e.g., with each Gitcoin Round), this system can output assets that minimize value loss. This is how SPOT is engineered from AMPL.
Once these concepts are integrated by our collective psyche, we can discuss further about growing the ecosystem together (e.g., pairing our tranches with AMPL Z-Tranches to foster market liquidity and related win-win outcomes). Reference.