Andre Cronje, the Founder of DeFi aggregator Yearn Finance, has recently published details of a new product, Coordinape which allows teams without top-down management—such as those that have formed DAOs—to autonomously allocate funds and reward contributors.
Coordinape Allows Autonomous Allocation of Funds and Rewards
A new product, Coordinape, allows DAOs to independently allocate funds, and reward contributors. Coordinape was built for the Yearn DAO and can be generalized for other organizations.
A tough question that comes in the way is that taking care of payroll is onerous enough in a traditional corporation. But a DAO doesn’t even have an accounting or HR department to carry out the task. So how can an organization reward its members based on their contributions? For which Cronje said that he “built Coordinape while working on the Yearn Finance DAO. At first, Yearn DAO adopted so-called governance weighted salaries—grants based on the number of monthly contributions to the platform. But this, he soon discovered, didn’t scale well because the process needed active management, voting and approval.”
“These are my favorite kind of products since they originate out of a personal need, but can be generalized to help any other organizations/DAO’s struggling with a similar problem,” he wrote.
Yearn Finance to Reward Contributors on the Basis of Points
DAOs or decentralized autonomous organizations renounce top-down management. Incentivizing and rewarding members is one of the most troublesome areas in their development. Offering a way to get paid to work on individual issues can attract more developers. If DAOs are ever to rival corporations—as some believe they will—finding a solution to these problems is vital.
Coordinape operates on a simple thumb rule. Members select the team members they’ve been interacting with during the past month and allocate points to them from a stash they’ve been given. At the end of the month, contributors can claim their grants based on the points they’ve received.
“This,” wrote Cronje, “builds up a contributor graph that is weighted towards the members that have the most interactions and allocations.”