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Project Catalyst - All the news that’s fit to print - July 2022

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Project-Catalyst-All-the-News-July-2022

Project Catalyst - the world’s largest experiment in decentralized innovation - is neither perfectly decentralized nor perfect in its innovation process. That’s why it’s an experiment!

With each funding round, we head back into the lab with some reliable constants, a few new variables, and a growing community of participants. (Are we the scientists or the lab rats?)

We are now working our way through Fund 9, and Project Catalyst is nearing its 2nd anniversary. Let’s take a look at some of the experimental variables that are being adjusted for this round.

Community Advisors Renamed: Proposal Assessors

An important role in Project Catalyst is that of the project reviewers. This small army of anonymous humans reads every one of the 1200+ proposals submitted in each round, rates them on a five-star scale, and writes helpful, nugget-sized reviews of each project. These reviews are helpful to voters and to proposers who may glean practical advice from constructive critique.

In the past, the job title of this role was “Community Advisor,” or CA. Lately, someone must have noticed that this title is not as precise as it could be. CAs were certainly part of the community, and doling out advice was one part of the role. The scope of their community advising was quite narrow, however, and in fact, can be explained in two words: they Assess Proposals. In an effort to be clear and precise in the context of a global, multilingual community, this role has been officially renamed. Proposal Assessors, as they are now known, still have the same job, now with a snazzy new title.

Proposal Assessors - Wallet and Anonymity recommendations

As a way of ensuring honest feedback, Proposal Assessors are able to work anonymously. This anonymity is not guaranteed, per se, and the text of the reviews themselves are publicly available. However, the names or handles of the assessors themselves are not published; instead, assessors are identified with a unique number. To further safeguard this anonymity, it is now recommended that PAs use a new, dedicated wallet for each funding round. This measure prevents curious or vindictive sleuths from discovering and potentially “outing” the identity of assessors by correlating the clues held in the public transaction history of a wallet.

For example: If a given wallet had a transaction for 172 ADA, disbursed on a particular date, which exactly matches the amount paid to a specific assessor… AND That same wallet had transactions aligning with project payment disbursement dates, and the amount of the transactions matched the payment amount of a particular project… THEN Our sleuth might correctly identify a supposedly-anonymous assessor as JOHN DOE, the lead person from the identified project.

This is one of many ways a wallet owner might be identified. Payments received, payments sent, and NFTs held in a wallet are all publicly viewable on the blockchain.

While you might wonder who would go to all this effort, we should all know not to underestimate the tenacity of a human with an ax to grind. Thus, this new recommendation. By using a fresh, new, dedicated wallet for each round, PAs can keep doing the important work of being frank and honest in their reviews without worrying about backlash.

Budget Stabilization & Control

This update is sure to cause more consternation in the community. It’s about money, which tends to cause heightened sensitivities when discussed, and furthermore, it’s just a little confusing to explain.

Over the last two years since its inception, Project Catalyst has been in growth mode. The budget allotted to each funding round has been budgeted and paid in U.S. Dollars. And the size of the budget has grown at times by leaps, sometimes as much as doubling from one round to the next! Having reached a budget of $16M in Fund 8, we hit a threshold where continuous doubling every three months was not feasible. This may feel like a letdown for those who have watched the pot grow so aggressively for each round. Though, ultimately, it is understandable that such a growth rate must be reigned in at some point.

The second factor driving the shift is that setting the budget in U.S. Dollars was a problem for an ecosystem that is built on an entirely different currency. There was no control valve to mitigate the risk associated with the ups and downs of the crypto market. Bull and Bear markets each take their turn over time, and many Hodlers have an attitude of just ‘staying the course,’ no matter today’s market. However, when discussing the stewardship of community resources, it’s necessary to be a bit conservative and strategic.

For these two reasons, Project Catalyst introduced a two-part update to its Budget strategy for future rounds:

  1. The budget size is capped at $16M We are pumping the brakes on the careening growth of the experiment. Like an adolescent puppy, we need to grow into our paws.

$16M per quarter is a generous budget for nearly any project. Stabilizing growth on the budget side allows us to focus attention on other areas, solving problems of organization, communication, and accountability that will enable us to make the most of our community investment.

  1. The Fund budget is measured in ADA Previously, while the Coin that changed hands was always ADA, the budgets for both the overall fund and for project proposals were all measured in USD.

Now, the budget for the FUND will be set at EITHER $16M U.S. Dollars OR 16M ADA – whichever is less.

For example:

  • If the price of ADA is $1.50 USD, then the budget for that round of Project Catalyst will be $16M USD.
  • If the price of ADA is $0.50 USD, then the budget for that round of Project Catalyst will be 16M ADA - translating to only $8M USD.

NOTES on this change:

  • These changes will be trialed starting with Fund 10. The budget has already been set at $16M USD for Funds 9. Challenge setting budgets proposed in Fund 9 have all been set to ADA. Starting Fund 10, budget and payout will be ADA denominated.
  • Budget setting (16M USD vs 16M ADA) will happen before the start of each fund - the change is not meant to happen as a last minute “Rug Pull” in the middle of a funding round.
  • Starting Fund 10, Project Proposal budgets will still be set in ADA, and paid out in ADA.

As we think through the implications of this change, let us remain clear-headed. This is not a sudden swerve into a dystopian land; no greedy dragon is trying to keep us away from his treasure. The Funds made available in each round of Project Catalyst are my money. And yours. And all of ours. While complete decentralization is still a work in progress, the goal of Project Catalyst is to put those funds fully in our hands. If the project’s structure were such that it could run aground due to open-handed spending in a bear market - we would not all be the winners. This change ensures that the treasury will remain healthy and able to continue funding community innovation long into the future.

Application updates

Suppose you participated as a PA in Fund 8 or tuned in to the conversations on Twitter and elsewhere. In that case, you know about some of the drama concerning repeat proposers, highly funded proposers, and those with many proposals in the current Fund. These were issues that hadn’t had time to develop earlier in the experiment. By Fund 8, however, some proposers had won proposals in every Fund, with no sign of stopping. Some had won significant amounts of money, and questions about project deliverables and completion rates started to rise. Some teams have adopted a strategy of breaking big projects with big budgets into multiple smaller proposals - hoping to at least get a foot in the door. This strategy was stretched to its limit in a few cases when singular proposers submitted dozens of very similar proposals.

To be clear, nothing about these strategies broke any rules or showed any sign of an intentional breach of trust. Pushing boundaries, reaching for the stars, playing smarter, not harder – all of these are part of the experiment. We learn from the things that work and those that don’t. Ultimately, many agreed that what was not working with these scenarios was the lack of transparency. What is now so much more evident is that when proposers ask the community to fund them, they are accountable for disclosing all their plans and results. This information is relevant to assessors and voters who must decide whether they believe that a proposal is feasible and likely to lead to the promised outcomes. If a proposer has had many of their projects funded, the voters might reasonably expect to see some project completion reports in due time. If a proposer has multiple proposals in the same fund, voters should know it. It is the proposer’s responsibility to explain how they might do all the work if all their proposals are funded.

To that end, the latest proposal application form on IdeaScale included a few new fields. Proposers are asked to disclose whether they have won any proposals in the past and whether they have others in the same fund. If the answer to either is yes, they are asked to provide details about how their current and proposed projects work together. They need to provide evidence that they can deliver not just their present proposal but all the work they are doing or hoping to do for the Cardano community.

Conclusion

For those who prefer certainty and stability, the changing variables of a live human experiment can be unsettling. Let’s conclude by reviewing the famous list that kicks off every Project Catalyst Town Hall:

Welcome to the experiment! Things may:

  • Break
  • Lack documentation
  • Differ greatly between iterations
  • Disorient, overload, and inspire Our Goal: Provide a safe and lively environment for you to explore the highest potential of human collaboration.

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