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More than 15% of Gitcoin's 9th round donations may be fraudulent, Vitalik Buterin suggests strengthening uniqueness verification

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Ethereum founder Vitalik wrote an article today summarizing this round of Gitcoin donation activities and expressed new thoughts on the aforementioned phenomenon.

Original title: "Gitcoin Grants Round 9: The Next Phase of Growth"

Original author: Vitalik Buterin

Original translation: Chain Catcher

Last month, Gitcoin launched the 9th round of donations, and its fundraising scale created a historical record. More than 12,000 donors donated $1.38 million to 812 different projects, reflecting the high enthusiasm of crypto users for emerging projects.

This enthusiasm is driven to a certain extent by the airdrop expectations of many users. Since Mask Network and other projects have previously airdropped tokens to Gitcoin donors, and this event supports ZkSync payments with a lower interaction threshold, many users participated in donations in order to obtain airdrops, and even registered multiple accounts to increase the volume.

Ethereum founder Vitalik wrote today to summarize this round of Gitcoin donations and criticized the above phenomenon.

Special thanks to the Gitcoin team for their feedback and charts.

Special note: Any criticism of the behavior of individuals or organizations in these comment posts, especially the use of words such as "collusion", "bribery", and "conspiracy", are only based on the spirit of analysis and mechanism design and should not be regarded as (especially morally) criticism of individuals or organizations themselves. You are all kind people.

Gitcoin Grants Round 9 has just ended, and as usual, this round was successful. Together with $500,000 in matching funds, more than 12,000 donors donated $1.38 million to 812 different projects, making this the largest round of financing to date. Not only old projects, but also new projects have received a lot of funds, which proves the mechanism's ability to avoid trenches and adapt to the changing environment. In the last two rounds, the new East Asia specific category has also been successful, helping multiple East Asian Ethereum projects to jump to the forefront.

Vitalik pointed out that the most challenging new phenomenon in this round of donations is the emergence of large-scale fraud, where some unknown groups have registered a large number of accounts and donations that attempt to deceive the Gitcoin mechanism. Since multiple sponsors will match the user's donation amount, this phenomenon requires sponsors to pay an additional $33,000.

Therefore, Vitalik believes that Gitcoin needs to create algorithms that can prevent bad manipulation, while reducing fraud through manual verification of accounts, inviting third-party analysis and community supervision.

After that, Vitalik took Mask Network as an example, believing that the retroactive airdrop of the project set a precedent for the industry. Nowadays, many projects are hinting in the forum that users will airdrop to donors. This situation makes the motivations of users participating in this Gitcoin donation present two types. "Do you donate because you like the results of the project obtaining funds (within the mechanism), or because you like some (outside the mechanism) results you get by funding the project?"

"If there is a long-term pattern of projects providing retroactive airdrops to Gitcoin donors, users will feel a pressure that they are not mainly donating to projects they think are public products, but to projects they think may have tokens in the future." Vitalik pointed out, "This subverts the ideal of using Gitcoin quadratic financing as a monetization strategy to provide an alternative to token issuance."

To this end, Vitalik introduced a solution called MACI in detail. The code has been released on Github. The following is a chain catcher's comment on Vitalik Partial translation of the original text:

MACI is a toolkit that allows you to run collusion-resistant applications with several key properties:

The first is correctness, invalid messages will not be processed, and the actual output of the mechanism is the result of processing all valid messages and correctly calculating;

The second is censorship resistance: if someone participates, the mechanism cannot deceive and pretend that they did not participate by selectively ignoring their information;

The third is privacy, no one can see how everyone participates;

The fourth is collusion resistance, participants cannot prove to others how they participated, even if they want to prove it.

Collusion resistance is one of the key features, which makes bribery (or retroactive airdrops) impossible because users cannot prove that they actually donated or voted for a project.

The technical description of how MACI works is not difficult. Users participate by signing a message with their private key, encrypting the signed message with a public key published by a central server, and publishing the encrypted signed message to the blockchain. The server downloads the message from the blockchain, decrypts it, processes it, and then outputs the result along with a ZK-SNARK to ensure that they were computed correctly.

Users cannot prove how they participated, because they have the ability to send "key change" messages to fool anyone trying to audit them: they can send a key change message to change their key from A to B, and then send a "forged message" signed with A. The server will reject the message, but no one else will know that the key change message has been sent. There is a trust requirement on the server, though only for privacy and coercion; the server cannot publish incorrect results by incorrectly computing or checking the messages. In the long run, multi-party computation can be used to decentralize the server to a certain extent, thus enhancing privacy and anti-coercion guarantees.

A quadratic funding system using MACI already exists: clr.fund. It works well, although the generation of proofs is still quite expensive at the moment. Ongoing work will hopefully reduce these costs soon.

Note that adopting MACI does come with a necessary sacrifice, which will prevent specific projects from giving rewards to donors, but it will still leave a lot of room for users to express their pride in their contributions. Projects can airdrop to all Gitcoin contributors without distinguishing by project, and announce that they are doing so with a link to their Gitcoin profile. However, users can still donate to other projects and receive airdrops. So this is arguably within the realm of fair competition.

But this is still a long-term question. MACI may not be ready for integration in Gitcoin donation round 10. Focusing on strengthening unique person verification in the next few rounds remains a top priority for Gitcoin. The Gitcoin team has already taken an excellent step in this direction.

If the Gitcoin team succeeds in playing a pioneering role in taking on and overcoming the challenges, we will finally have a secure and scalable quadratic funding system that can be used for a wider range of mainstream applications.