What is Sourcecred?

Sourcecred (SC) is an algorithmic system of value-capture and distribution that is increasingly being used by DAOs. Essentially it measures and tracks the value of contributions. By using SC algorithms, DAOs are able to set up and adapt their own crypto-economic systems of incentives and rewards for their members.

So how can I get emojis to pay my bills? 🤔 Yes, you read that right, emojis might actually be able to pay your bills, or at least help organize it thanks to the wonders of Sourcecred! 😮 🥳

Basic Concepts

I am guessing that you find yourself in an SC-assisted DAO either by accident or design. If so, then you may want to understand the concepts of cred, weights, nodes, edges and the contribution graph. OR just skip to EmoNomics.

Cred is a measurement unit of value in a DAO’s SC system. Cred is basically a form of reputation points, at MetaGame we call this XP (short for experience points).

DAOs using SC likely have their own tokens. In such cases, cred value is converted into the DAOs token on a periodic basis according to the results of the algorithm's metrics. Snapshots of cred values are recorded at specific, planned moments, called SC instances.  These snapshots determine how many tokens are to be minted and distributed to the community to cover the time period since the previous instance. 📸

Weight is the term used to describe how “heavily” something is valued. High weight, equates to high value and low weight, to low value. It can be adjusted to determine vectors of value creation that are possible in different nodes and at different edges. ⚖️

A node is any focal point in a web of connections. This means individuals, roles and contributions are nodes. Every connection to any other node is called an edge; it denotes a relationship and these edges allow cred to flow between nodes. All nodes are ultimately connected to the wider Contribution Graph by edges, to nodes, to more edges, etc, with cred flowing through it all. This is the network of mutual value creation and distribution that makes up the whole graph. 📈

• It is probably worth re-reading the paragraphs above starting from ‘Cred’. ♻️

Receiving Value through Sourcecred

The 2 main ways to currently receive value via the Sourcecred Algorithm are:

Responsive 👀

• Emoticons or ‘likes’ are symbols**,** which act as a means by which value can be signaled to be added to contributions of any eligible DAO participant. The strength of any one signal to confer value is dependent on parameters that determine that symbol's weight. The signal weight may also depend on who is giving and receiving, and where it is happening. Using any emoji sets up an edge that can flow cred between nodes (members). Effectively, emoji-ing is an indirect order to pay someone in a DAO some currency!

Organised 🗓️

• Here, SC acts to award value through initiatives. Initiatives allocate a certain pre-meditated weight and value to a project or role, making it independent of reliance on reactive community responses to place value by the conscious use of symbols.

A Hybrid system 🤯

A planned new SC system called "The Creditor" will, in the future, merge aspects of both the responsive and organised approaches.

Crediquette

Cred use and abuse, sometimes referred to as signal/noise ratio, is what determines how well a project’s SC system works to reflect the value created, by value distributed. So it is essential that cred systems are well thought through and run. For this reason, weights may be changed over time to help fine-tune the systems. This means DAO members are all responsible for their DAO's financial health. By staying informed about how to responsibly use your DAO's value system you can do your bit to make sure things go smoothly. 😇