Announcing Panvala, the sustainable treasury for communities to share.

Ethereum created a culture of builders. The technology opens up so many new possibilities that it became a magnet for people who wanted to build the future. Financial infrastructure for the unbanked. Trade without middlemen. New systems that align incentives so groups of strangers can cooperate.

In the early days of Ethereum, there weren’t many ways to earn a paycheck for doing this kind of work. Instead, people found a new incentive to justify their work: if they held ETH while they built tools that made ETH more useful, the increased demand for ETH could be its own reward. That incentive propelled so much of the early phases of development in our community, and without it, we probably wouldn’t be where we are today.

But the incentives that got us here don’t seem to be sustainable enough to get us to where we’re going. These days, many newcomers to blockchain technology don’t join our community. Some of them find other systems that launched more recently where they might be able to get in early on something new. Others take their ideas about how to scale blockchains and create brand new blockchains with their own tokens so they can be handsomely rewarded for their work. Our community is beginning to splinter and divide. We designed Panvala to bring us back together again.

Panvala is the sustainable treasury for communities to share. We subsidize communities the same way Bitcoin subsidizes its security. Bitcoin doesn’t fund itself from transaction fees, but it also doesn’t rely on a foundation or wealthy benefactors. Instead, when you hold BTC, you opt into a system where you know your holdings will be diluted to fund security, up to the maximum supply of 21 million BTC. Panvala generalizes that concept so that instead of funding blockchain miners, it can fund anything our communities want to do together. We fund these subsidies by inflating the supply of PAN, an ERC-20 token on the Ethereum network, up to the maximum supply of 100 million PAN.

Communities in the Panvala League stake PAN tokens to earn donation matching capacity from Panvala’s inflation. By working together to raise funds using the same token, all of the Panvala League communities benefit when any of the communities succeed. The League’s goal is for communities to own the same share of Panvala as the share of the budget they want to receive, so we reward them for it with a higher matching multiplier. A community that stakes 10% of the staked PAN and raises 5% of the donations is within their capacity, so they’re rewarded with the highest matching multiplier available.

However, a community that stakes 10% of the staked PAN and raises 20% of the donations has exceeded their capacity! They can stake more tokens to earn the highest multiplier for all of their donations. Otherwise, they’ll be fully matched for the 10% of donations within their capacity, but the multiplier will decrease as the overflow increases. In that scenario, the community will receive a larger share of the quarter’s budget than the share of tokens they own! Inspired by cooperatives, we prioritize patronage over ownership to make it attractive to join Panvala whether you’re the tenth community or the thousandth.

Blockchains are the most powerful tool for social coordination we have ever known. If we build the right systems to pursue goals people believe in, there is no problem we can’t solve together. If this blockchain revolution is more than just hype, let’s use our technology to solve the biggest problem ahead of us: let’s make Ethereum sustainable.

Visit our website, follow us on Twitter, and most importantly, submit your community as a prospective member of the Panvala League!