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Proof-of-donation refers to the integration of charitable donations into the functionality of a blockchain.
What Is Proof-of-Donation?
Proof-of-donation refers to the integration of charitable donations into the functionality of a blockchain. Typically, this describes a redirection of funds, set by a smart contract and triggered upon each transaction, toward a charitable destination. The charitable donation can be given to a wallet owned by a charity, or a separate fund whose funds are controlled by a DAO or other party.
Proof-of-donation is a modification of a traditional proof-of-burn that aims to bring altruism and sustainability to the blockchain transfer model. As blockchain activity scales, given the programmatic redistribution of funds, the charitable donations will likewise scale and contribute to the sustainable growth of the network.
An example of proof-of-donation is that employed by Hermez Network: coordinators bid for the right to process transaction batches using the token HEZ; 40% of each winning bid is donated to Gitcoin as a way to fund Ethereum public goods, while 30% is burned and 30% is redistributed to the network.
Author:
Jordi Baylina is one of the strongest Solidity developers in the world and a high impact contributor in the Ethereum community. He is a co-founder of the White Hat Group, which played a major role in rescuing funds from TheDAO and Parity Multisig hacks, author of the MiniMe token contract, the elliptic curves Solidity library as well as numerous other established contracts in the Ethereum space. Jordi is also a well respected auditor, most notably leading teams to audit the MakerDAO Stable Coin system and Aragon project. Founder of the donation platform Giveth, DAppNode, Iden3 and most recently, Hermez.
As a seasoned expert deeply entrenched in the blockchain space, particularly with a focus on Ethereum and smart contract development, my knowledge extends across various aspects of decentralized technologies and their practical applications. My expertise is underscored by a comprehensive understanding of concepts such as proof-of-donation, proof-of-burn, and the integration of charitable donations into blockchain functionality.
Let's delve into the concepts mentioned in the article:
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Proof-of-Donation (PoD): Proof-of-donation is a novel approach to infusing altruism and sustainability into blockchain systems. This mechanism involves the incorporation of charitable donations into the fabric of a blockchain, often orchestrated by smart contracts. In the described scenario, funds are redirected based on predefined rules triggered by each transaction. This ensures a continuous flow of charitable contributions, promoting social responsibility within the blockchain ecosystem.
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Traditional Proof-of-Burn: Proof-of-donation is presented as a modification of traditional proof-of-burn. Proof-of-burn involves the deliberate and irreversible destruction (burning) of a certain amount of cryptocurrency tokens. This process, in the context of proof-of-donation, has evolved to encompass a more socially conscious and sustainable model.
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Smart Contracts: Smart contracts play a pivotal role in the implementation of proof-of-donation. These self-executing contracts with coded rules facilitate the automatic redirection of funds toward charitable destinations. In the context of blockchain, they ensure the transparent and trustless execution of predefined actions.
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Decentralized Autonomous Organization (DAO): The article mentions that charitable funds might be controlled by a DAO or other parties. A DAO is an autonomous, decentralized entity that operates on a blockchain, often governed by smart contracts and consensus mechanisms. It allows for transparent and democratic decision-making within a community.
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Hermez Network's Proof-of-Donation Example: The article highlights an example of proof-of-donation employed by Hermez Network. In this model, coordinators bid for the right to process transaction batches using the HEZ token. A percentage of the winning bid is donated to Gitcoin for funding Ethereum public goods, while another portion is burned, and the rest is redistributed to the network. This showcases a practical implementation of proof-of-donation within a specific blockchain network.
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Jordi Baylina: The article is authored by Jordi Baylina, a highly regarded figure in the Ethereum community. He is acknowledged as one of the strongest Solidity developers globally, co-founder of the White Hat Group, and has contributed significantly to various Ethereum projects. His expertise is further demonstrated through his role in rescuing funds from notable hacks, his contributions to the development of Ethereum contracts, and his leadership in auditing projects like MakerDAO Stable Coin system and Aragon.
In conclusion, the integration of proof-of-donation into blockchain systems, as exemplified by Hermez Network, represents a noteworthy advancement in combining technological innovation with social responsibility within the decentralized landscape. This approach not only fosters sustainable growth but also reflects a commitment to philanthropy within the blockchain community.
