Crypto Payments
An overview of the payment structures of crypto communities in the Polkadot ecosystem.
What are Crypto Payments?
Crypto payments are any type of transactions that involves transferring digital assets from one account to another. These payments can be scheduled at regular intervals based on specific parameters. In digital communities, crypto payments are primarily used to tip, compensate, or award members for their contributions.
How-to: Designing Incentive Systems
In the Polkadot ecosystem, there are many formal pathways for community members to see their work recognised and endorsed by official project teams.
Ambassador and Growth programmes are the most popular options for incentivising newcomers to contribute to a project and make an impact in the existing community. As part of these programmes, ambassadors and community contributors need to fulfil certain tasks and obtain a given number of points before they can receive rewards (i.e native tokens, swags, mentoring, etc.) High-performing individuals can also get immediate access to a special reward pool and progress into Senior roles after some time.
The Anti-scam and the Community moderation teams are special community initiatives entirely funded by bounties which are paid out by the Community treasury. These bounties are subdivided into daily and weekly duties (also called "child bounties") that team members (also called "child bounty implementers") undertake as one-off tasks paid upon completion or as recurring tasks paid monthly. There is a base salary paid to bounties administrators (also called "curators"), but they can also earn more by evaluating and reviewing additional tasks. To maintain high-standards across the board, there are monthly evaluations and blind peer-assessments in place.
For content creators, budding influencers, and tinkerers, the incentives vary depending on whether they are part of existing communities, in a team, or working solo. In a popular hubs for content creators, there is often a tiered system in place to rank and reward contributors based on their output, their experience, and their standing. In more selective groups, contributors have access to networking opportunities which can lead to full-time employment. Builders who have a working Proof-Of-Concept or dApp can also request a tip from the OpenGov community to receive payouts from the Treasury.
Risks: Mitigating Operational Challenges
Over time, contributors may be more inclined to post low-quality content just to farm views/likes/comments, and subsequently get paid. This is often the case when crypto communities have poorly-designed incentive mechanisms that rely exclusively on the appeal of financial gain. For this reason, community builders should consider offering non-monetary rewards such as POAPs, Discord roles, merch, exclusive pass/tickets, or custom pfps.
Due to the volatility of crypto assets, community members relying solely on crypto payments for their livelihood may face the issue of unstable income. While stablecoins could offer better protection against these fluctuations, very few projects in the Polkadot ecosystem use these to reward their contributors. Having easy access to fiat on-ramp for cashing out crypto income into your local currency is an essential step to keep in mind.
When it comes to bounties, there is always the risk that operators go offline for extended periods or lose access to their accounts. It is recommended to use multisig setups with at least 5 different signatories to ensure the continuity of operations. However, handling complex payment processes requires operators to upskill on the job, as there is no formal training provided. Consequently, there is only a very small pool of potential candidates available for curating a growing number of community-related child bounties. More user-friendly interfaces and tools are therefore needed to simplify processes for new entrants.
Last updated
