Fracton Research was founded as an "R&D institution for a positive-sum world through exploring inclusive coordination design" last October. Fracton Research has been engaged in research and development related to coordination mechanisms such as public goods funding and collective decision-making. While in 2023 we focused on promoting our vision, in 2024, we particularly focused on activities related to impact evaluation / impact measurement. Impact evaluation is a frequently discussed topic in the public goods funding space. In recent years, experimental efforts have been made centered around Optimism, to verify the effectiveness of grant programs and to provide funding more effectively to public goods that have brought about greater impact. We are also working on impact evaluation to contribute to achieve more effective public goods funding. As a current issue, we identified the lack of data for measuring outcomes. As part of understanding the current situation through data collection, organization, and analysis, we conducted a data analysis of grant programs. Specifically, we focused on the managing entities of grant programs and conducted a quantitative comparison across different programs. We classified the types of managing entities into "Foundation Type," "Democratic Type," and "Algorithmic Type (QF Type)"; Foundation Type’s grant programs are composed of members who are arbitrarily selected and approved by token holders, Democratic Type’s grants managers are token holders including delegates or selected by token holders, and QF Type uses Quadratic Funding. By quantitatively comparing metrics such as grant amounts and the number of grantees, we highlighted differences among these types. Specifically, we discovered that Democratic Type and QF Type tend to distribute funds more evenly with smaller variation and smaller grant amounts, while Foundation Type shows larger variation in the grant amounts received by each grantee. We had a speech about this content at Devcon SEA, so you can see the video in this link. This research also served as an opportunity to discuss with various individuals analyzing grants like Grants Innovation Lab, which has been a valuable source of inspiration for our research and development. Thanks to financial support from Optimism, Public Nouns, and Gitcoin, we were able to continue our research and development, and we are deeply grateful for their contributions.
The year 2024 was particularly focused on Asia, as Devcon SEA was held in Bangkok, Thailand. At Devcon SEA, we had the opportunity to present the results of our research and also made our presence felt at other events held in Thailand. At Funding the Commons Bangkok which was held before Devcon SEA, we hosted a workshop on the aforementioned grant program analysis, engaging in discussions with participants. Concurrently, at the hackathon held alongside the conference, we developed a protocol called IES (Impact Evaluation Service), which evaluates impact reports created by impact evaluators and provides incentives for these evaluators. This protocol, developed during the Funding the Commons Builders Residency held over a month in Chiang Mai, Thailand, won an award at the hackathon.
At DAO Asia, a side event of Devcon SEA, we introduced "Yohaku", a project we have been contributing to. Yohaku promotes community contributions that respect local values. By utilizing NFTs and TBAs (Token Bound Accounts), it visualizes and evaluates individual contributions, creating a system that can be passed down through generations. Yohaku aims to build communities that transcend geographical boundaries through autonomous governance and scalable design.
Also, in Tokyo(our base), some global conferences were held, attracting people from around the world. Among these events, it was a significant experience for us to co-organize the first-ever Funding the Commons Tokyo. This conference not only brought together Ethereum developers but also many participants from NPOs, academia, and government sectors who are not directly involved in the Ethereum ecosystem. For us, who are centered around the Ethereum ecosystem, this was a major experience for connecting with other sectors. Impact evaluation is not limited to the Ethereum ecosystem but is also a demand in the real world. Many participants from external sectors took an interest in our activities, and connecting with people outside the Ethereum ecosystem was meaningful in expanding the scope of our activities. By being involved in Funding the Commons Tokyo, we likely contributed to bridging the gap between the Ethereum ecosystem and the real world.
Toward 2025
In 2024, we began focusing on impact evaluation / impact measurement and conducted quantitative analysis of grant programs to gain a data-driven understanding of the current state of public goods funding. We also created a database of grants to be utilized in future analyses. Furthermore, we developed projects related to impact evaluation during hackathons. Overall, in 2024, we focused on building the environment needed for evaluating and measuring impact. In 2025, we will aim to focus even more on impact evaluation while also attempting to actively measure impacts and produce impact reports. While much of the current work on impact evaluation is centered around OSS (open source software), we plan to focus not only on OSS but also on communities and hackathons. Grant programs provide funding not only for OSS but also for communities and events, and our new initiatives will likely contribute to the effective management of future grant programs. Communities, particularly those focused on Ethereum, often operate with value systems distinct from financial gain. Given that communities are essential elements of the Ethereum ecosystem, people working on impact evaluation should measure the effectiveness of communities based on various value systems. Communities that receive evidence-based funding will be able to achieve sustainable and effective operations. Through these efforts, we will aim to deeply contribute to the achievement of more effective grant programs.