Blocktrend receives OP airdrop: rewarding members for early investment with RetroPGF
#522
GM,
The first article after the long weekend brings good news - Blocktrend has successfully applied for the Retroactive Public Goods Funding (RetroPGF) grant from Optimism, and will receive a total of 6,355.71 OP tokens. According to the current market price, these OP tokens are worth approximately $15,000 USD (approximately 450,000 TWD).
As promised previously, I will return all of the tokens to Blocktrend’s paying members after the OP is credited. This article not only explains the distribution principles of OP, but also discusses the significance of RetroPGF to Web3 and Blocktrend. In order to familiarize future readers with the operating mechanism of RetroPGF, I will first briefly introduce why subscribing to Blocktrend can also result in an OP token airdrop.
RetroPGF
RetroPGF aims to solve the problem of "no one willing to pay for public goods." I once conducted an informal show of hands in a public speech:
Suppose all of you in attendance are paying members of Blocktrend, subscribing for $8 per month with automatic deductions from your credit card. However, I now announce that starting today, Blocktrend will eliminate the paywall mechanism and make all articles available on the internet for free. Those who are willing to continue paying for the subscription and will not immediately cancel their automatic deductions, please raise your hand.
Approximately 10% of the audience raised their hands, which was quite reassuring. I know this is human nature - why pay when you can access content for free? However, if everyone ultimately chooses to cancel their subscription, Blocktrend will have no income, and I will be forced to find another job to sustain my livelihood, unable to continue providing "free content" for everyone to read.
This is known as the tragedy of the commons in economics, which RetroPGF hopes to solve.
There are many public goods in the Web3 field, such as checking if a transaction has been credited on Etherscan, writing smart contracts using Solidity programming language, or finding investment opportunities from DefiLlama. Although these tools are freely available for everyone to use, they are not created for free. Etherscan can still earn money from advertising space, but how can Solidity programming language incorporate advertisements?
In July 2021, Ethereum founder Vitalik Buterin proposed the idea of RetroPGF, hoping to turn donations for public goods with 0 investment return into smart investments with profit opportunities. There are few people willing to donate generously, but if it is a profitable investment, more people will be attracted to participate. The development team of Optimism, the second layer network of Ethereum, agrees with this concept and has actually allocated OP tokens to implement it over the past 2 years.
The RetroPGF operates through three stages: proposal, evaluation, and reward. The evaluation committee, composed of citizens from the Optimism Citizen House2 located around the world, reviews the impact of each project since its inception and rewards them retroactively. This is different from government grants, which rely on the committee's investment foresight in predicting which projects have the most potential.
Retroactive evaluation is less prone to errors than predicting future developments, making it the main feature of RetroPGF. Blocktrend's receipt of OP tokens signifies the committee's approval of its contributions to the Optimism ecosystem.
Results
According to the RetroPGF grant announcement made by Optimism last week:
Retroactive Public Goods Funding is a driving force behind the development of the Optimism ecosystem. Based on post-data and statistics, RetroPGF distributes funds to builders who work to provide public benefits to the Optimism ecosystem.
RetroPGF2 is Optimism's second experiment in funding public goods. In this experiment, 69 early "citizens" voted on how to distribute 10 million OP tokens to support OP Stack projects and individuals. In total, there were 195 proposals, and all of them received OP rewards. When evaluating the impact of each project, these citizens allocated their votes on average to 40 different projects. The median number of OP tokens received per project was 22,825, and the top 10% of projects received an average of over 140,000 OP tokens.
The ultimate goal of RetroPGF is to equate the impact of public goods with profits. For media, the more positive impact they create for Optimism, the more rewards they ideally receive in RetroPGF's grants.
Blocktrend's participation in RetroPGF is aimed at encouraging more Chinese readers to participate in the entire RetroPGF process and receive their first cryptocurrency on Optimism through proposals, evaluation, and reward distribution. People who receive cryptocurrency for no reason are naturally curious about where the money comes from, and may become actively involved in the Optimism ecosystem in the future. This is the positive impact that BlockZest hopes to create.
However, there is no unified standard for "impact." Each committee member has their own criteria for determining which projects are impactful, and this determines the amount of OP tokens each project receives. My goal for Blocktrend was simply to receive OP tokens, regardless of the amount, and to distribute them to all paying members who subscribed before March 30, 2023, when RetroPGF announced its results. Detailed rules and exceptions will be explained when distributing the OP tokens.
Tying the distribution of OP tokens to the total amount of paid subscriptions serves two purposes: to thank early paying members for their support, allowing Blocktrend to operate steadily since 2017, and to create economic incentives to attract readers who previously read for free to subscribe and receive OP tokens.
The model of giving OP tokens for subscriptions may sound new, but it is not unfamiliar. Some newspapers still offer free gifts like pans for annual subscriptions to attract long-term subscribers.
The RetroPGF grant from Blocktrend operates in a similar way. As long as you subscribe to our paid section, we will periodically give away OP tokens. OP tokens are considered a "commodity" by the government, just like a frying pan.
People who receive frying pans can choose to use them or sell them for money, just like with OP tokens. The difference is that the value of the cryptocurrencies given away by Blocktrend through the RetroPGF grant can fluctuate with the market and media impact (as determined by judges), possibly exceeding the subscription fee paid to Blocktrend.
If Blocktrend can consistently receive support from the RetroPGF grant, I will announce the removal of the paywall one day. The incentive for people to subscribe will have changed. In the past, paying for a subscription was to gain access to paid content and support Blocktrend's operations. But in the future, even without the paywall, people may still be willing to pay for a subscription, not only to show support but also to receive OP token rewards that are only available to paying members.
This means that both free and paying readers can access all content, but only paying members are eligible for OP rewards. These rewards may only partially subsidize the subscription fee, or they may exceed the subscription fee itself. If I were to conduct another survey at that time, I believe that more people would be willing to continue paying for a subscription after the paywall is removed, as subscribing to Blocktrend would no longer be a one-way donation, but an "investment" that could bring profits.
Business Model
Although Blocktrend has received 6,355 OP tokens, it is still lower than the median of 22,825. L2Beat, which is an information website in the education category, has received the most OP tokens, with a total of about 256,000 OP tokens, currently worth about 18 million TWD. For a small team, this amount of money is more than enough to support future operating expenses for a long time, and may even become a new Web3 business model.
In the past, many media outlets and investors judged the development of blockchain based on the size of the Total Value Locked. To quickly attract more funds, blockchain development teams generally set aside large amounts of money to reward a few landmark DeFi projects. However, the size of the funds is a lagging indicator of ecosystem development. Tokens will eventually be distributed, not only to the pockets of crypto billionaires, but the entire ecosystem may also be deserted.
Optimism takes a more "stupid" approach. They believe that if there are many wallets and browsers that support Optimism on the internet, and the media frequently reports on Optimism's development, users will gradually flow into this ecosystem. The crowd will eventually bring the money, supporting the size of blockchain funds. Therefore, they allocate a large budget to reward public goods through RetroPGF.
This is only the second RetroPGF, and there will be a third, fourth, and fifth. Optimism will continue to allocate operating income, and in the future, BASE blockchain created by Coinbase will also join the sponsorship ranks to support public goods development through RetroPGF.
Blocktrend is honored to be Taiwan's first media outlet to participate in RetroPGF and to offer early investment through OP rewards to our members. Starting next week, we will also participate in a new round of Gitcoin's Quadratic Funding, encouraging free readers and listeners to help Blocktrend receive funding matching with just a single bus or MRT fare. Although investors are eagerly anticipating the next crypto bull market, if you are a Web3 public goods builder, now is our time to shine in this market.
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