Crypto protocols are default-open. This means that important strategic decisions are discussed, funded, and ratified in public.
Common is default-open: transparent threaded discussions, not anonymous Discourse forums, full-spectrum voting not backroom deals, and user-controlled capital to help create and grow any project or interest. Common uses an on-chain social graph to provide an intuitive interface for any tokenized community--Layer 1, DeFi protocol, NFT holders, or investment DAOs.
Users simply link a wallet and are able to instantly join the communities for tokens they hold; greatly aiding discovery around specific use cases. Tokens are the common touchpoint and "chain events" are the interesting interactions—e.g. whale transfers and governance votes.
Communities claim their space and access an all-in-one tool offering a discussion forum, stakeholder analytics, on-chain governance, chat channels, and crowdfunding.
Beyond being a product, Common aims to be a fully decentralized social network and crowdfunding protocol, with the long-term goal of allowing developers to tap into a set of rich social and funding primitives to help grow their own tokenized protocols. This paper provides an overview of the elements of the Common Protocol.
As a protocol, we combine several key features enabling individuals and projects to run decentralized communities. In this way, we are similar to crypto-Reddit with built-in funding primitives. This allows communities and social groups to fund public goods, trustlessly pool capital, and moderate/control their community without relying on a top-down governance model.
- Identity and Reputation: each user and community is associated with a namespace.
- Namespace: a specific sub-domain for a user or community
- Reputation: each namespace will have associated reputational data
- Communities: a namespace linked to a community-owned by a DAO
- Private: A closed community where specific user addresses may join to talk and build together in private.
- Gated: A community-owned by an existing DAO, where their native token can gate access to content and can be pooled for delegation and investing.
- Public: A community-owned by the CMN DAO that does not require purchasing/maintaining a subdomain, but has limited functionality.
- Users: a namespace linked to a specific profile that can have added roles
- Admin: A role that offers full privileges for a specific community
- Moderator: A role that offers limited privileges for a specific community
- Curator: A role that enables promotion rights for a crowdfunding campaign
- Funding: crowdfunding via dominant assurance contracts with redemption capabilities
- Projects: for raising Kickstarter-like crowdfunding
- Collectives: for pooling capital into an endowment or investment fund
- Chain: smart contract chain for decentralized storage of content, protocol incentives, and a platform for social applications.
Namespace and Identity
Communities and users can claim a unique NFT (EIP 1155) identifier at [name].common.xyz. At its core, Common protocol is a registry of these identifiers.
For communities, users pool CMN and stake it as a bid for the namespace. The winner of the auction then must pay a flat-fee and leave their token staked to preserve ownership of the namespace. Users with CMN staked for the community namespace are joint-owners of the DAO community. Any rewards earned by the DAO community are distributed to the owners of the DAO.
For users, individuals pay a flat-fee in order to claim available user namespaces. These namespaces are able to be verified via web2 identity Twitter for sybil-resistance (i.e. publicly posting proof of Twitter account with a signed message). Verified user namespaces can hold a variety of roles in different communities and earn non-fungible reputation, CMN user rewards, and community rewards.
We anticipate namespaces to get claimed for usernames (u/dillchen), community names (c/dydx), topics (c/evm), and niche interests (c/john-wick). We anticipate holding out of auction ownership of the several popular names such as 3 letter names and other existing tokens to be transferred upon proving ownership of said token.
Communities as DAOs
Each community on Common is a DAO. This allows us to break away from monolithic moderation models used by traditional web2 platforms and for specific communities to choose exactly how to manage their own community. Communities can specify community policies around membership roles, moderation, and interactions.
Community DAOs are able to leverage crypto infrastructure. Each community is able to manage a treasury, create crowdfunding proposals for community projects, and optionally earn fees off of these crowdfunds. We will discuss this more in the funding section.
Registration: When communities identify an open namespace they wish to register an auction period begins. If the community wished to remain private, they can whitelist specific users that are allowed to contribute to their namespace bid.
If a community prefers to remain public, as opposed to owned by a token community, they can submit a bid of 0. Assuming another bidder does not come along, they will win the namespace for a period, but it will be owned by the CMN DAO.
Endowments: Communities can choose to create a collective (more on this later), where community members can stake assets. These collectives can then invest the assets and charge a percentage carry, which goes to the DAO (for public communities, a portion of carry goes to the CMN DAO). Collectives can also act as “super-delegates” and vote on behalf of the community.
Quality Control: CMN token holders are able to vote to ban communities for bad behavior. If a community is banned, they lose their namespace and a portion of their staked token is slashed and given to the CMN DAO. In the case of public communities, users associated with the banned community are then prevented from joining public communities for a set period of time.
Each community includes:
- User registry
- Roles, as voted on by the community and populated by the client
- Global reputation score
- (Optional) Collective endowment
- (Optional) Fee rules
- Selecting what proportion of fees for crowdfunding and other interactions will go beneficiary addresses
There are several types of communities, differing based on membership set and governance rules. We detail them below.
Gated communities allow users to associate their token with a community. This allows anyone with that token to gain power over the stated Common community and forum. For example, the AAVE community may decide to leverage the AAVE token to moderate the commonwealth.im/aave forum.
Users that hold the designated token, are able to access specific channels for token holders, vote on governance proposals, and other community-specific benefits.
The token-weighting of the gating token is calculated based on the amount held by each address. Future iterations may use a quadratic funding formula to determine the amount of reputation held via the gating token.
Communities without a native token can opt to be governed via their own community coin. A community coin is minted on a bonding curve (with CMN reserves) that favors early buyers. CMN reserves used for buying creator coins are staked on the network, earning yield for the creator.
The creator coin curve is a power function of the form:
x is the reserve asset (CMN), while y is the price of the community coin. m and n control the incline of the curve, and c lowers and lifts the curve. We anticipate that CMN governance will add different curves for communities to utilize to support different use cases.
Common includes primitives for project crowdfunding and collectives (e.g. investment DAOs). Communities can additionally use these primitives for launching a new DAO.
A project raises from a crowd of backers just like a Kickstarter campaign. Backers stake assets that aren’t able to be unlocked by a project unless a predetermined fundraising goal is reached. If the project does not reach the fundraising goal by the deadline, backers receive their staked assets back.
Common uses an added role for curators (via dominant assurance contracts) as promoters/syndicators to help fund projects. A curator stakes a financial asset (and their associated reputation) on this project until the deadline or goal is reached. If the goal is not reached, the curator’s staked assets are distributed to the backers plus their backing.
This construction shifts backers out of indifference because backers get a “win-win” scenario for funding projects. If project funding happens they get the good they wanted, and if project funding fails then they get their deposit and an additional reward.
Projects Seeking Funds
Projects create an on-chain proposal seeking funds. This launches a smart contract that provides a deposit address for received funds. Beyond basic information for the project, a project creator needs to specify:
- Fundraising goal
- Accepted currencies or tokens
- Backer rewards (optional): an added reward, like an NFT or rewards based on proportional backing on any bondi
- Curator allocation (optional): a percentage of the fundraising goal curators can source
- Curator reward (optional): a portion % of the total amount raised that goes to curators
If projects choose no curator reward then the project is treated as a traditional crowdfunding project.
Curators Staking Assets
In research, by introducing a curator via dominant assurance contracts, both the rate of successful project funding and the amount raised is doubled per project. Curators show skin-in-the-game by staking tokens on a project they endorse.
To show that this incentivizes projects to be funded, consider a case in which a project has a zero probability of successful funding. In this case, the contribution amount is less than the funding amount. When there is a refund bonus to be earned by a backer, then it must be continuously possible for a new backer to increase his refund bonus by marginally increasing his contribution.
In this case, total contributions will still be less than the total required amount. As new backers contribute marginal amounts, the threshold is eventually reached. Getting to the last backer, assuming the value of this project is greater than zero, there is always an amount that this backer will fund the project.
If a project is successfully funded, the curator earns a portion (expected to be ~5%) of the total funded amount. If the project fails to reach its funding goal, the curator’s staked tokens are given to project backers. This reward incentivizes curators to actively search for projects and connect them with backers. Initially, they are also incentivized by CMN token usage mining rewards specifically for curators.
While anyone is able to serve as a curator, most successful curators will have some reputational capital in addition to financial capital. Within crypto, curators may be projects themselves, foundations, influential individuals, or DAOs. Outside of crypto, curators might be university Labs, non-profits, scientific journals, or other individuals that want to champion a specific cause or set of individuals.
Curators put financial and reputational capital on the line to help project fundraising succeed. Anyone can serve as a curator, and a curator is able to freely choose on which proposals to stake. There is no cap on the number of curators or curator-raised capital for a project.
To ensure that curators and projects do not collude to commit fraud, a curator’s stake may be slashed via CMN governance action.
Backers Funding Projects
Backers are able to choose from a number of projects to fund. The curators’ stake works as both a signal for quality as well as possible financial reward, which pushes backers out of indifference and into funding projects by default.
Funding projects is now a “win-win” scenario. In the case that the project does not reach its threshold, the backer’s money is returned in addition to the pro rata share of the curators’ staked assets. If the fundraising campaign is successful, the backer receives their desired common reward.
Creating Long-Term Collectives
Projects building for the common good often have trouble raising capital. It is especially hard for technical projects like a smart contract audit or research. The lack of funding leads artists and scientists on the continual chase for funding, distracting them from the act of creation.
Common solves this by letting individuals and communities create collectives. Collectives are started like project fundraising campaigns, but have three added parameters.
- Strategies: backer-approved investment strategies for the underlying assets
- Carry: a percentage of the generated profit given to the collective creator
- Governance rights: does the collective or backer retain governance rights
In the case of a collective meant to benefit common goods, the collective may use low-risk yield-generating strategies and set a high carry rate. This allows backers to maintain their initial assets, but offer transparent, sustainable funding to the creators.
In the case of a collective meant as an investment vehicle, the manager must pre-approve investment strategies in the fundraising process and get governance approval for any later-added strategies. Backers can then evaluate the creator reputation, on-chain investment history, strategies, and curator support when evaluating their investment.
In the case of a collective meant to be “super-delegate”, a community of like-minded people has the ability to easily pool voting power of many different governance tokens with the creators. We envision this playing out similar to a union, which has both financial and representational rights.
bTokens and cTokens
As backers and curators participate in projects and collectives, tokens are minted. To redeem underlying collateral, they burn the corresponding b or cToken. bTokens and cTokens are similar to different classes of tokenized convertible bonds.
For backers, bTokens have a claim on the curator’s collateral, their own stake, and any other token that the project creator gives as an additional incentive to fund the market (aka for a token launch).
cTokens (curatorTokens) are minted as curators stakes onto a project. They represent claims to the proportional share of 5% fee on total raised by project. While bTokens are essentially risk-free, cTokens carry some risk if the project funding does not succeed. While cTokens are able to earn potential yield from the project raise, or the continuous stream of interest from collective assets being used in DeFi.
These tokens are new DeFi primitives and be built upon by future projects. For example, several bTokens or cTokens could be bundled in an index to form a set of research backed-tokens. Individuals could earn a stream of cash flows based on the amount of research funded by a particular collective. Individuals can go short, by “collateralizing or backing the project” and then selling the token on secondary markets.
Common is built with an intuitive client for users to communities and users to leverage. In the future, to ensure that each interaction and all content is decentralized and censorship-resistant, we will leverage an independent blockchain, the Common Chain. Unlike money-based use-cases, social interactions are inherently parallelizable, i.e both Bob and Charlie can reply to a post made by Alice. Which enables a rethinking of how different applications can run in a blockchain context. With this in mind, the Common Chain is a sharded, WASM and EVM blockchain purpose-built for social applications.
As the network of communities on Common grows, new developers and founders can leverage the chain to create new experiences layered experiences with an open-social and reputation graph built on all user interactions. The Common Chain includes several key primitives that make it purpose-built for social and governance interactions. Key features include.
Project-level Meta Transactions: Most user interactions on-chain will be lightweight. Users should not have to pay for interactions such as likes or retweets. Instead, projects themselves will be able to relay and pay for fees (e.g state growth and storage rent) that may be incurred by user behavior on-chain. This is similar to how DeFi protocols incentivize decentralized oracles instead of requiring users to pay for their own oracle. A project may incentivize this by allocating a portion of their new application governance token in exchange for third-party CMN token holders to stake on their behalf. In this case, project-level meta transactions may be deducted directly from a third-party staker’s un-unearned CMN staking rewards. Future improvements may allow for projects to directly bid on a set amount of block space or security.
Common’s storage backend will be decentralized, by using a pinning service to store social data on IPFS, Filecoin, and/or Arweave. We expect to port our database to Canvas, an execution layer that makes Common frontend-independent, allowing discussions to be embedded into DAOs, DeFi protocols, and other places around the web.
Threshold-Based Session Keys: Each interaction on an application (e.g. a post, like, or comment on the Common governance platform) is publicly signed and batched both by the address of an application and user. Applications will need to run nodes to publicly sign messages in addition to users.
Delegated access keys, e.g, Session Keys, are generated on a per (d)application basis, allowing the chain to differentiate between usage on each application. Allowing a user the ability not to need toauthorize every single post. Sessions Keys will be able to remain valid for a user determined amount of time, similar to stored sessions on traditional web applications requiring a login. The worst-case scenario, under the most severe threat model (e.g. a stolen computer), would be fraudulent authorship. Users will be able to socially recover their key pairs by re-validating with their on-chain address. In the future, adding new devices will be quite easy to do, simply by creating a new signing key on the new device, and then sending that key to the original device to be signed by a wallet. This is similar to 2FA processes used by popular messaging apps such as Telegram and Signal.
By generating the key using the non-extractable property, and storing on a per-application basis. This means that there's no way to export the private key at all — the private key can only be used to sign content on the application in which it is loaded. In addition, allowing the Common Chain to incentivize user and application development via token-based incentives.
Identities: By integrating into the Common Name Space, verified addresses across applications will be able to benefit from features such as native transactions, automatically gas refunds, and project subsidized fees.
As the network of communities on Common grows, developers and founders can leverage the chain to create new experiences for these communities and new users alike.
CMN DAO and CMN Token
Common will use the native token CMN to incentivize good behaviors for all actors across the ecosystem. CMN will serve as an incentive to rally the community, the token for curator fees and namespaces, and the governance token for the protocol.
This is contrasted with systems like Kickstarter and Facebook, where ownership is not shared with projects (i.e. Pebble), apps/groups (i.e. Zynga), and users (i.e college students) that were successful in popularizing each platform.
Common DAO Governance
After the launch of the Common governance token, future development and direction of the protocol will be determined by the Common DAO. At launch, 21% of the token supply will be assigned to the DAO treasury to ensure long-term support for the protocol. Perpetual, protocol-controlled issuance will be used to incentivize validators, core and application developers, and users alike.
Common Protocol will initially utilize a stake-weighted voting process. In the future as the nampespace amtures, utilize a quadratic voting model and only allow for wallets that have verified their namespace to participate in governance. This enables less voting power to be assigned to large token holders, while also maintaining Sybil-resistance.
One of the initial governance items for the Common DAO will be to launch a collective with a large portion of the CMN token to be invested in low-risk, yield-generating strategies. These strategies should enable both a consistent passive income stream and increased liquidity for CMN markets. This passive income will enable the DAO to have a sustainable income stream for future development.
Content and Moderation
A major component of the Common governance model is to help moderate the platform. Centralized web2 social platforms and tools suffer from a single point of failure. Often allowing one founder, or majority stakeholder to space public discourse. Instead, Common decentralizes this responsibility. Moderation happens by a community flagging process for bad actors. Bad actors (i.e namespaces violating community norms) are subject to a CMN-stake weighted voting process, where the penalty may be a slashing of stake, restrictions of certain platform behaviors, or returning the name to Common DAO ownership. Reclaimed namespaces will be auctions publically. Gradually, the DAO will develop sophisticated rules about bad behaviors and reputation scores.
Staking and Inflation
In order for the Common Protocol to function, growing towards all stakeholders, there are a variety of incentive rates controlled by the governing DAO. At first, these rates will be set to positive rates and funded with directly future issuance.
Common anticipates a 5% target inflation with incentives being allocated to a set of stakeholders.
- 40% of inflation allocated towards validators
- 10% of inflation allocated towards the protocol controlled treasury
- 50% of inflation allocated towards incentives
Incentivizing Network Roles
In the early lifecycle of the network, incentives are able to programmatically distributed for specific behaviors. Governance is able to vote in and specify an on-chain behavior, a reward amount, and a specified amount of supply to distribute for a specific on-chain. Instead of blank slate liquidity mining programs, governance will be able to target for set periods of time calls to various contracts. The network will be initialized with several temporary incentives:
- Funders: Addresses that call the createCollective, createProject, curate, and back contract calls. These addresses will earn a share of CMN for performing the action as well as based on the amount deposited or raised.
- Communities: Communities that create claim a name space will claim a reward based on their total verified user signups, the pool of which will be split proportionally over a set period of time.
- Users: Users that signup up with receive a standard reward for signups. In the future we anticipate this to be split among active community participation based on linked reputation protocols.
- Developers: Developers on Common will be able to claim a set of grants for certain community milestones. Additionally, we will include a set token supply for ‘app staking’. Allowing users to stake on their favorite applications and allowing developers to option split fees to their stakers. In the future, we anticipate governance to adopt specific on-chain KPIs for to allow for different app categories.
- BD Incentives: (2% of total supply, issuance governed by BD grants committee)
- Community Onboarding: Customized invite links attribute referral rewards to users/communities
Each incentive may be boosted on an individual level, by staking CMN towards the specific address to receive a reward.
Major Community Markets
As a community platform, we see for different crypto communities. Common Protocol can offer all of these communities value:
- Base Chains - These are the major Layer 1 and Layer 2 ecosystems. Think Ethereum, Avalanche, Solana, Polygon, Arbitrum, etc. They are the layer most dApps are built upon and are interested in developing tooling for their ecosystem. This tooling may be financial protocols, DAO infrastructure, technical primitives or modules, etc.
- DeFi Protocols - These are specific protocols focused on financial use cases and typically share similar priorities. Assuming they have a governance token, their DAO is primarily focused on investing in the development of the protocol, integrating with other DeFi protocols, listing assets, and regulating protocol incentives.
- NFT Communities - Different from traditional protocols, membership and governance of NFT communities happens with whole tokens only. These communities also do not have a base protocol that needs technical development, but rather a community and set of visual assets to improve.
- Investment DAOs - Investment DAOs enable a group to pool resources for a common investment strategy. These may look like PartyBids, OlympusDAO, ConstitutionDAO, or PleasrDAO. Depending on the specific structure of these organizations, they will have different needs for portfolio development and investment approval.
- App Chains - Different slightly from Base Chains, App Chains are more specialized blockchains meant to power a specific subsection of dApps, rather than a general purpose machine for any dApp. These communities need to be specific about what they are for and evaluate technical adjustments to perfect product-market fit.
Any type of crypto community can utilize Common Protocol to help coordinate common resources for collective problems. These are a few of the use cases we see opportunity in.
- Transparent, Full-Spectrum Community Management. Currently, most crypto communities rely upon opaque Web2 community management tools like Telegram, Discord, and Discourse, which are all prone to Sybil attacks and increase friction for community governance. Common Protocol enables verified identities (as little as a linked wallet as much as a verified Twitter or GitHub account) and end-to-end governance. Linking threads with polls, off-chain votes, on-chain votes, treasury grants, and crowdfunding enables full-spectrum community support.
- Creating Community Funds for Social Tokens, Art, and Scientific development. Tokens like $ALEX or $FWB do a great job of coordinating like-minded people, however it often ends there. By creating a collective and only accepting $ALEX or $FWB, individuals can fund projects together. This principle can also extend to those who want to fund artists, research institutions, and development teams. Depositing token into a collective lets individuals offer the yield to creators and maintain ownership of the underlying assets.
- Bounties, Developer Tooling, and Research for existing projects. Over $20b of funding for crypto projects has been raised by teams and communities whose purpose depends on an ecosystem of tools. Yet these wallets, user interfaces, and even researchers often don’t have sustainable business models. Ecosystems can augment their existing treasury to crowdfund for specific tools. For example, Synthetix and Polkadot can allocate their $1b+ treasuries to a collective or project to fund useful tooling, common infrastructure, and small bounties useful for projects. Gitcoin is already doing this at a small scale.
- Increase access to high-performing investments. Currently, much of the best performing financial assets are inaccessible to the broader market. After a new project raises a grant from a DAO, they then transition over to traditional VC until they eventually launch their token. Those early investments are often the ones that perform the best. Furthermore, most investment funds are blocked off to most investors. Utilizing a decentralized investment collective allows more people to participate in top-of-the-line investment vehicles and syndicates.
- DAOs as unions and pension funds. Unions, pensions, and Coops, help like-minded individuals pool their resources to support shared interests. These organizations often utilize collective bargaining, pooled voting power, and diversified asset management in order to advance the collective. Common Protocol enables these working groups via both Common communities and collectives. Delegating assets to a community collective enables crypto “super-delegates” and common asset management.
- Distribution channel for developers. Common is an open protocol and as developers and founders develop new valuable products, they can build on Common’s liquidity and shared social graph. These integrations will enable communities to easily adopt new tooling, integrate it into their shared space, and potentially even participate in the upside if the tool raises funding on Common Protocol.
Common is default-open: threaded discussion not private emails, transparent on-chain voting not backroom deals, and user-controlled capital to help create and grow any project or interest.
Communities are able to claim their space, giving instant access to an all-in-one tool includes a discussion forum, viewing key stakeholders, on-chain governance, channels for chat, and crowdfunding.
Beyond being a product, Common aims to be a fully decentralized social chain and graph. The ecosystem will include crowdfunding and developer tools to help developers grow their own tokenized protocols.
While Common Protocol will be initially launched on EVM compatible chains, over the next year, an application-specific social chain will be launched to lower transaction fees, improve user experience, and enable true cross-chain governance and collaboration.
- AngelList / Kickstarter / Patreon / GofundMe / Github Sponsors. With the exception of AngelList funds where economics are shared with the GP, these platforms don’t reward curators, instead taking fees for the platform itself.
- Mirror / Zora / Foundation / Rarible / SuperRare / Async.art/ : Most of these projects focus on the creation / incentivization of an already produced project, or on a collectible that has artistic and or resale value. Common augments these projects by letting individuals crowdfund for an NFT or collectible.
- Social Tokens: Common projects will be able to be limited to a specific set of social token participants. Social token communities will be able to create a community collective, to pool funds and create new projects.
- Gitcoin / QV / CLR.fund: This is a complicated funding mechanism and requires the matching of funds from a donor. Also, it currently has a problem with identity, in that an adversary may spoof many spread tokens into small accounts.
- Circles, Camaraderie (Discord and other things): Non-tokenized community platform.
- Tally / Boardroom: Governance dashboards that are utilities.