Join GitHub today
GitHub is home to over 31 million developers working together to host and review code, manage projects, and build software together.Sign up
This document outlines some of the current thinking in parts of the community. This is not the final word on the topic. This is an editable wiki, anyone is free to contribute to this document. For meta-discussion about the contents, see this forum post.
Official Foundations are sometimes seen as an obvious 'must-have' requirement for any serious cryptocurrency project. The purpose of this document is to evaluate whether there's just cause for such a foundation in the context of the Grin project. Experiences from other crypto projects are considered, followed by identifying the potential use cases a foundation is supposed to solve for. Each of these are then discussed in the context of a foundation, and what the alternative to that could be.
It should be pointed out that it's not possible or intended to prevent foundations from being set up. Any individual, group, or other entity may freely decide to set up a foundation, as is it within their right. What's being evaluated is rather whether a foundation in "official" capacity can be mandated or not.
September 13, 2018: There are no current or future plans to create an official Grin Foundation. Other entities wishing to set up foundations or other organisations with intentions to support the project are welcomed.
Selected experiences of other projects
- Bitcoin Foundation has been mired in controversies regarding its leadership and received cease and desist letters from US institutions.
- The Tezos Foundation ended up in a vicious legal dispute with the project founders whilst some $400m in funds at the time were locked.
- The Monero community opted not to create a foundation in the first place, this post sums up some of the thinking behind this.
- Aragon has announced that they seek to work towards decentralising their foundation and reducing its responsibilities.
- Zcash Foundation has published results from their Governance process, which sheds light into some of their activities, challenges, and feedback from their community. Their mission statement identify Community, Protocol/Governance, and Science as the three key pillars of the foundation. A recently expressed goal by the Foundation board was to "exist long enough to become irrelevant / unnecessary".
- MakerDAO have announced a a foundation proposal as part of their Maker Governance Framework. As part of their proposal, 'gradual decentralisation' is to be realised through the work of the foundation.
- Cardano Foundation representative's issue.
Possible Foundation Use Cases
- To own/manage assets. Owning assets that are valuable to the community, such as domain names, trademarks, IP, Login info, account privileges, art & media assets etc.
- To act as official representative. A spokesperson of sorts for the project. For PR & media related enquiries. Issuing "official" statements.
- To offer legal protection. Assume legal liability for the project in order to deflect and protect developers and others in the community from being sued or targeted for legal prosecution.
- To offer legal advice. Legal counsel used to offer advice to community members and support in the event of legal conflicts.
- To accept charitable donations. A destination for community members to send donations to that can then be used to promote the project's interests.
- To fund development projects and research. Using donations and foundation resources to fund development efforts that are important for the project. Fund research efforts.
- To educate, lobby, network. To educate authorities about what the protocol does and doesn't do, to make arguments to politicians about why they should not try to ban privacy coins, to demonstrate how the project is compliant with a local regulation, to participate in alliances with other charitable organisations that value privacy, etc.
- To nurture and grow the community. Community building exercises, conferences, symposiums, supporting meet ups, hosting speakers, etc.
- To make protocol/governance related decisions. Contentious topic. Some foundations explicitly avoid taking an active role in governance. Others seem more active and responsible in "steering" the community and offering advice in times of hard forks and protocol conflicts.
Weighing different approaches
|Using a foundation||Not using a foundation|
|To own/manage assets||
|To act as official representative||
|To offer legal protection||
|To offer legal advice||
|To accept charitable donations||
|To fund development projects and research||
|To educate, lobby, network||
|To nurture and grow the community||
|To make protocol/governance related decisions||
There are many use cases where foundations may be useful. In general, it seems however that a foundation is not a prerequisite to solve for these, and that they also can be solved on a per case basis via an engaged and committed community. It's not clear that a foundation will do a better job. Having a foundation creates overhead and centralises power and authority into a physical legal entity. For a project that strives to be decentralised, this seems contradictory. On the other hand, there are efficiency and accountability benefits that can be realised with a professionally run foundation compared to community efforts carried out ad-hoc, which may or may not be done properly. There's a real trade-off there and the community should decide what is valued most.