Dominant assurance contract

Our initial t0wn STAGE 1 plan was to have DAOs sign LOIs stating their intent to contribute to a t0wn treasury to buy land for a “DAO hub.” We decided it would not only benefit t0wn, but also CityDAO and the web3 community at large if we figured out how to program the essence of an LOI into a smart contract. Utilizing Alex Tabarrok’s Dominant Assurance Contract idea, we will create a smart contract where entities can pledge money toward a public good (like t0wn). If the funding threshold is hit by a certain deadline (which is programmed into the smart contract when it is deployed), the project gets funded. If the threshold is not hit by the deadline, everyone gets their money back and those that contributed the earliest get a small monetary “prize” for having been the first movers / believers. Details around the prize mechanics will be sorted out during development, one key component being the prize is big enough to incentivize early contribution but small enough to disincentivize entities wanting the project to fail.

Building a dominant assurance smart contract will not only be a boon to t0wn and CityDAO, but also to anyone who wants to fund a public good on the blockchain without using methods such as Juicebox that take a significant percentage of funds.

See snapshot for more info.