The Public Goods Network from Gitcoin promises to redirect most net sequencer fees into public goods instead of giving them to tokenholders or developers.
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Layer-2 blockchain Public Goods Network launched a testnet on July 7, promising to spend “the vast majority of net sequencer fees” on public goods instead of paying them out to the development team or tokenholders, according to an announcement from the network’s developers. In economics, a “public good” is a good that cannot be produced for profit because it is difficult to exclude non-payers from its consumption.
The new network was developed by the same team that created Gitcoin, a project that seeks to raise funds for open-source projects. Public Goods Network is being built using the OP Stack, meaning that it can become part of the proposed “Superchain” that will include Optimism and Base networks.
Okay Devs,
Overjoyed to announce @pgn_eth, a community-led L2 focused on sustainable funding for public goods
Check this out if you’re building anything related to public goods, because I have testnet Eth for you
⬇️⬇️⬇️ https://t.co/b0mdS1Symw
— zakk.eth (is on a quest ) (@0xZakk) July 6, 2023
According to the project’s documents, Public Goods Network will be an Optimistic layer-2 rollup of Ethereum. This type of network generally uses a profit-making centralized sequencer to batch transactions and periodically submit them to Ethereum.
The Gitcoin team says their new network will reinvest “the vast majority” of this profit into public goods projects. In their view, this is necessary to prevent venture capital firms and others who are motivated by “rent seeking” from capturing the value provided by layer 2s:
“Rather than fill blockspace for other organizations who may be captured by VCs, or other rent seeking motivations, we believe we should fill our own blockspace such that we can reallocate those funds to further the Alliance’s objective of growing and funding public goods.”
Gitcoin claims that the sequencer fees will not go directly to them. Instead, it will go to an “alliance” being formed based on a “newly defined governance model.” In a Twitter thread accompanying the announcement, the team said the network’s long-term goal is to allow projects to be funded directly by sequencer fees, without a middleman, using the EIP-6969 standard.
Related: Coinbase’s Base network publishes ‘path to mainnet’ outlining roadmap
The current Public Goods network is connected to the Ethereum Sepolia network through an official bridge, allowing developers to test out apps using funds from Sepolia’s various faucets.
Gitcoin originally rose to prominence by using quadratic funding to provide grants for open-source projects and other public goods. Gitcoin’s head of impact, Azeem Khan, joined the advisory board for crypto fund Foresight Ventures in June.
The Public Goods Network, developed by the team behind Gitcoin, has launched a testnet promising to allocate the majority of net sequencer fees to public goods projects rather than tokenholders or developers. The network, built using the OP Stack, aims to prevent venture capital firms from capturing the value provided by layer 2s and instead reinvest the profits into growing and funding public goods. The long-term goal is to allow projects to be funded directly by sequencer fees using the EIP-6969 standard.
– The Public Goods Network, developed by Gitcoin, has launched a testnet that will allocate most net sequencer fees to public goods projects.
– The network aims to prevent venture capital firms from capturing the value provided by layer 2s and instead reinvest the profits into growing and funding public goods.
– The long-term goal is to enable projects to be funded directly by sequencer fees using the EIP-6969 standard.
