[DRAFT] SourceCred and the Quest to Outcompete Capitalism


Interesting. I’m coming from a pocket of the filter bubble where capitalism is basically a bad word, so I may have played that up a bit. In a number of respects, I quite like capitalism (which I alluded to in the second section); in part, I am really impressed by complex systems and the global economy is an incredibly complex and successful system.

Originally, I was using the term “venture altruist” (inspired by Accelerado). However, it’s not quite right. In this model, the investors are still investing for their own return, so they aren’t altruistic; it just so happens that they are invested in a public project rather than a private one. So “venture socialist” seems appropriate to me. Also, I feel like recent political developments have shown that having a clear message is more important than avoiding turning people off.

Yep, good point. I’m riffing off an essay called How to Outcompete Capitalism? and its author takes the time to give a definition of capitalism upfront.

Grain is fungible. It’s basically designed to be the fungible analog to (or derivative of) cred. Cred is not fungible.

Yeah, I really like the idea of things that are like currencies, but embed values. Not sure how to do it though. It’s definitely not as simple as making an ERC20 token. :slight_smile:

What capitalism gets right

Capitalism is very good at distributing stuff–both physical stuff (technology) and intellectual stuff (science). Small world networking works to general advantage–few hops to connect producer to consumer.

What capitalism gets wrong

Capitalism is very bad at distributing reward. Small world networking works to general disadvantage. Hyper connected bridging nodes get a cut of everything monotonically increasing concentration of capital in these nodes. As capital concentration increases, bridge nodes tend to merge accelerating the concentration. Network with too few bridge nodes is unstable. Panic, aka depression, aka recession, aka correction ensues. Rinse, repeat.

Cred would be a back-propagation mechanism that certainly could offset the monotonically increasing concentration of capital in the bridging nodes, which would be a really good thing–more palatable than taxes in general and confiscatory estate taxes in particular.

Question: Is this Socialism– Perhaps micro-socialism, which would also be a really good thing–macro-socialism has a lot wrong with it, too. Maybe a second paper is called for, “SourceCred and the Quest to out-cooperate Socialism”?

I love this suggestion. I am a fan of pointing out that our historical political and economic systems are a very small subset of the possible set of such systems; rather than being biased by structures in the past, we can aim to leverage technological change and paradigm shifts to create new ways of organizing that are not necessarily inside the convex hull of previous ways of organizing. This is the kind of newness evidenced by the shift from agriculture to industry in @decentralion’s previous post.

SourceCred and the Quest to Outcompete Capitalism

SourceCred and the Quest to Outcooperate Socialism

together help place the future as being neither and both at the same time, which helps people build their thinking enough to make a new open source based economy feel possible, even obvious.

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How about: “SourceCred and the Quest to Out-cooperate Capitalism”?

I feel like capitalism is a better “opponent” to draw definition from than socialism, since capitalism is the dominant organizing modality of the present day.

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Agree with this sentiment. I think outcompete Capitalism has a better ring to it. Maybe the discussion of cooperation and realizing net sum productivity gains through a less individualistic paradigm can just come through in the text.

@decentralion, definitely stick with out-competing capitalism, and you’re right about keeping the comparison to capitalism in the forefront for now, and your outline is a good one.

Keep the socialism comparison on the back burner, though. Capitalism and Socialism are the major economic theories around today. (Unless you want to count cronyism, which I don’t. That is more about pure power than it is about economics.)

Just as capitalism is a reaction to the excesses of cronyism, socialism is a reaction to the excesses of capitalism. The problem is that socialism has its own excesses that took almost no time at all to emerge. The reason for the fast emergence of excess may have something to do with socialism having theoretical origins that were then tried out. Cronyism and capitalism just sort of happened, and theories about them came later to model observed behaviors. To put it another way, cronyism and capitalism are what they are because that’s the way people behave under those conditions. Socialism, on the other hand, starts out with a priori assumptions about how people should behave, and then builds conditions that are thought to promote those behaviors.

The value that I see in SourceCred is that it is following an observation-based approach to understand cooperative behavior. We are observing the behaviors of people spontaneously assembling to produce something, and we are using those observations to build views of how contributions of individuals affect the assemblages’ production.

This observation-based approach gives SourceCred the potential to actually fulfill the promised goal of socialism to blunt the excesses of capitalism. Socialism has great cooperative slogans. “From each according to his ability, to each according to his needs.” However, it must resort to authoritarian means, because the way in which it defines cooperation has no basis in the way that people actually behave. People naturally follow leaders–hence cronyism. People naturally act in their own self interest–hence capitalism. People are naturally drawn to causes bigger than themselves–hence SourceCred.


Truth. It’s a loaded word.

Good counter option but I think they are both terms that generate all kinds of racket. Perhaps just make up a new frame that wont incur the bias of todays age?

Tbh, if i were to pitch SC to the project I currently work for, it would be a hard sell already. If some of the decision-makers saw that it was socialism (or even just being coded by socialists), they would instantly say no, without looking further into it. I realize that using these loaded words could give SC a narrative boost, which would allow its message to spread quickly. But I think that’s a double edged sword. And also, do we want SC to be a politically neutral platform? I would argue for it to strive to be as objective and politically neutral as possible. If it’s powerful enough, it will shake the status quo, which is capitalism. Ergo, the title, ‘outcompeting capitalism’ is good. And will appeal to the capitalists too actually.

Frankly, I am neither a socialist nor capitalist; I think both words represent low dimensional projections in a massively high dimensional design space for human organization. If anything I am trying to break out of the socialism vs capitalist plane and into a new plane that combines the best aspects of both and new ideas yet to be fleshed out, that are now possible because of advances in information technology.

Reducing it to “ew socialism” is that decision makers problem not mine/ours. I very much back @decentralion’s decision to go deep not wide, in part because I don’t care to go out and convince people to use this tool. I’d much rather focus on using it well for our own project and a handful of others who are aligned on message. The people who matter can be attracted much more organically, not through ‘marketing’ methods.

Without being to cruel, I’d say many of those same people who make decisions purely on ideological heuristics will be the first to copy paste a successful solution methodology if it becomes successful/popular. It’s the pattern of making decisions without really thinking about them, blindly accepting and copying some pattern of thought. Those people will never be my priority, over genuinely figuring out how to get something right, with feedback and iterations from people who are also thinking about it at a more fundamental level.


@noman, what utility would SourceCred bring to the project you work for?

@davidfs I can imagine many ways. The most exciting possibility is simply paying people, cred “dividends”. I imagine that if done right (or right enough), it could be a much better way to pay people, and would also attract new talent. Probably the most sellable application would be a recruiting initiative. I.e. time-based cred that accrues to new contributors only if they actually start making commits. Aragon just put out a blog a couple days ago announcing some new products, including “rewards”, which pays dividends in ETH or “spice” (very similar name to SC’s grain; great minds:). They mention a similar idea, where dividends go to people that commit during a specific time-frame.

I was also told to read this book!!

I love that aspect of SourceCred, “retroactive funding” is what can help organizations break out of unproductive patterns. I assumed that DAOs would also be solving that issue but interestingly, in the DAOs I’m part of (Genesis DAO & PolkaDAO) we also follow the traditional funding strategy (only fund future effort) except rare cases. The reason for this, in a nutshell, is that 1) one may ask to be rewarded for something no-one actually cares enough about and/or 2) that no approval was given for funding a task.

The first point (ask reward for something no-one actually cares about) can be very problematic for the contributor: if you spend several weeks working on a task then you may only realize afterwards that it is not valued (hence you don’t get rewarded for it). However, this issue often happens because a contributor is new and takes too much risk: assumes she/he knows what should be done AND tries to tackle a task that’s too big for a new contributor. Anyone with experience will usually build up enough knowledge to avoid that kind of issue. This issue also happens if the project direction isn’t clear enough (i.e. the project is still young & a lot of topics haven’t been worked on yet [no examples/precedents]) - whoever drives the organization can try to solve that by communicating the project direction more clearly (via any communication channels available).

The last point (no approval was given for funding a task) is not something I resonate with, imo if one creates value then one should get rewarded. However, each project has a limited budget & some priorities so trying to keep some control over what should be worked on next (future work rewarded vs past one) does make sense. However, again if the project direction is clear on basic time frames (i.e. short term & mid term) then this problem will be solved.

I’m very excited to see the outcome of the CredSperiment, it might inspire some organizations to allocate some funding for past work done (i.e. once a week like you’re doing in the CredSperiment). This would definitely encourage more constructive contributions.

Well, that’s assuming all the alternative regimes/systems that were crushed by other regimes are totally responsible for their failures. One could argue that capitalism could have never seen such success if another system had been big enough to prevent it to grow. We’re slightly getting off topic here as it’s not the main point of the discussion here but I wanted to raise awareness about this as most of us have grown up in capitalists societies & forget that important point: wars were/are fought to convey the message that capitalism was/is the "right” system.

You meant “write open-source software for Grain/Cred:slight_smile:

Being provocative here to reflect on possible edge cases: if a project uses SourceCred using long term contributions as the main setting for reward, wouldn’t that be similar to a patent (or even a DRM) ?

Definitely can add something more sci-fi such as:

  • What if you and all your everyone you know were working for several decentralized organizations at the same time, each of them rewarding you fairly for your overall & continuous contributions?

And something more grounded:

  • What if in 2029 every mainstream tech companies like Google and Apple started to use SourceCred to give 0-25% bonus to their devs every month?

:100: Paradigm shifts is what will make us go forward. I see the “retroactive funding” aspect (rewarded for what you have done vs on what you negotiated beforehand) as a key component of what can help trigger such shift. Crypto is also a key component & is well on its way to change a lot of the world as we know it today - so many fields impacted, it’s mind blowing. DAOs are still at infancy but at the same time so obviously ground breaking that it’s just a matter of years before we see them changing organizations as we know them today.

The title is catchy. But doesn’t it fall in the “them vs us” category a little too much? As in, as much as we dislike some aspect of capitalism it comes with many different shades (i.e. capitalism in the US vs capitalism in Germany). I really like the post from Dandelion, it shows a lot more the two sides of the coin of capitalism and the post title does not reflect that.

The rest of your comments totally makes sense. Afaik crypto is probably one of the most risky investment assets out there & is very much geared towards ultra-capitalism (anything goes). So if one cares about attracting crypto minded individuals this might not be the best title.

My understanding is that SourceCred is beyond capitalism. At the end of the day, it’s a tool that at its core wants to trigger a paradigm shift in how we work, how we reward. Maybe the title could be “SourceCred: beyond Capitalism” ?

Mind that “socialism” means something different according to different countries. So you might get some misunderstanding. It’s quite catchy though so maybe raising eyebrows might give you the attention you need to get people to read up further.

“our-cooperate” is a bit heavy imo

:100: Breaking out into new paradigms means we have to leave those labels behind us

General remark

Beyond the capitalism/socialism discussion, I think the essence of SourceCred is to try to help humanity reward work more fairly. If I had to convince someone to invest in SourceCred, that’s the elevator pitch I’d go with, simple & touching a value everyone can relate to: fairness.


Great to hear from others in DAO land! I think real-world experience in these systems brings a valuable perspective. My main gig is in the Decred DAO. Which does pay in arrears (retroactively) for most day-to-day work, but uses a more traditional future-looking proposal system for larger projects. I’m now a big believer in paying retroactively, though there is definitely room for improvement, which I think SourceCred has potential for.

Welcome! Your post just gave you some cred. As does this reply:)

This is basically my reality now, working mainly for Decred getting paid in crypto, and now getting paid as part of the CredSperiment also. Paying the rent :money_with_wings:

@decentralion came here from Google. Has some interesting stories to tell.

Even better, it might be a never before seen holy fusion of capitol and labor, which results in new, fairer systems not possible before.

Not a bad one word description.


In the very early days of SourceCred, I had a chat with a senior Google executive who wanted to do just that. (Well, specifically he was thinking of using SourceCred as an input to Google’s performance process.)

I felt it would be much better to incubate SourceCred in a “pure” open-source context before engaging too much with the tech giants, so decided not to go in that direction. I could see it happening in the future! We have a lot of time between now and 2029. But for now I’m a lot more focused on open-source users.

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I agree with this, but it’s also a bit tricky. I think of SourceCred as being (like money,) an intersubjective construct. It’s an attempt to measure the value that people provide in a way that is less centralized, more open to community input, more transparent, and more accountable. If it succeeds in these things, I think it will also be fairer than any of our existing systems. (Or, to be more precise: it will be fairer than other systems which are also capable of scaling to large groups of people.)

Where I get a bit hung up is, “fairness” is subjective rather than intersubjective. If a community decides on the cred, that is the cred. But if a community decides that I’m being treated fairly, and I think it’s super unfair, then in my experience it is unfair. And it’s a given that in any cred instance operating at scale, some people will feel they are being treated unfairly.

So that’s why I’m a little reticent to describe SourceCred as “fair”, even though I basically agree with your point. Perhaps I’m splitting hairs to an unnecessary degree here.


Agreed. Focusing on open source totally makes sense. I was only providing this as an example of impact it could have on traditional tech businesses.

Maybe yes :slight_smile: I’d argue that you could say the same about many (any?) products out there: they are being built with a vision in mind but some of the users feel disconnected to that goal as their experience isn’t related to that vision at all.

One other thing that you may be interested in: in DAO articles & presentations we often give them more human-friendly titles such as “the future of work”. This connects with anyone & always gets good feedback. SourceCred is also entering that realm so that might be something you can use (for another piece if not for that one).

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Not sure if this thread is still relevant, but here’s a few thoughts

This has more to do with leverage and value capture vs the dynamics of labor/capital. It’s possible to do work that has compounding returns (something where you create new assets and/or skills that build over time). It’s also possible to do work where you don’t learn or create anything new and day after day you have to do the same work over and over.

This is a feature of life. For example, this forum could be viewed as a market: sellers post ideas and buyers respond to and/or like the ideas. The more interesting/valuable the ideas the more attention, likes, and responses they will get. The “currency” is attention, but it’s still a market. The problem has been, until recently, that that’s very hard to measure.

The problem here is not the transactional mold, but that it’s hard to measure things. A “transaction” in the purest sense of the word is an exchange. We exchange value all day long.

The problem is that a lot of that value is hard to measure. As a result, we have not measured it. Things that are concrete have been measured, and as a result have accrued value. Things that are subjective have not been measured, and as a result have been “free”.

With better tools we can make better measurements. This will allow us to measure and reward all sorts of valuable contributions. Things that have previously been too subjective and/or small to “price” can now be recognized and rewarded. This will allow “markets” on ideas, attention, and conversations. Content creators (people creating posts/comments) are “selling” and content consumers (people liking posts/comments) are buyers.

In addition to expanding the set of immediate transactions that can be measured, the way we measure the assets being exchanged has room to improve. Many transactions are investments that lead to benefits later on, but are only measured at the time of exchange. This is due to the fact that measuring intangible investments over time is difficult. We’ve created financial contracts and markets tfor investments in tangible assets that are easy to measure (see paragraph above), but we did not expand that model to intangible assets. This is because the intangible assets are hard to measure, but even if we could measure them, the (historical) cost of setting up infrastructure to do so would have been prohibitive. Today we have computers, the internet, blockchains, and advanced data processing algorithms. This makes it easy and cheap for people to directly exchange value. It also makes it possible for someone to create value for another, but then receive value back in the future as that value is realized. This has many of the characteristics of a traditional capital investment: value is exchanged in the present for future expected value. The main difference here is that the set of “value” that can be measured increases, transaction costs decrease, and all value creation can result in future value for creators and is thus a type of investment.

In the context of SourceCred the, the “market” is SourceCred: a dynamic non-linear system that determines the value of content produced by the community. This value is measured and contributors are awarded Cred and Grain for their efforts. this measurement happens on an ongoing basis so the value of contributions can be “realized” throughout time rather than as a static transaction. It’s an evolution of capital markets: open ended multi-party transactions in a non-linear market.

The transactions still happen, they’re just more sophisticated.

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People keep posting on it, so I think it keeps being relevant :slight_smile:

Interesting point.

This is a feature of our present cultural context. It is not a feature of life in general, or even of human life in general. Consider Burning Man as an example of a space that is intentionally non-transactional. If you’d like to learn more, I recommend reading Debt: The First 5000 Years. It provides a bunch of intuition on how and why our current economic reality was organized, and tears to shred the myth of barter, i.e. the idea that pre-money societies were transactional.

As evidence that SourceCred is not fundamentally transactional, consider the following. I linked to David Graeber’s book just above. In a future, more sophisticated version of SourceCred, I hope that the we will have an edge to David Graber giving him some Cred for influencing my thinking. (Note to future cred historians: I would include Debt in my list of top 5-10 books that have been most relevant to me in thinking about SourceCred).

Using Google’s top definition of transaction:

an instance of buying or selling something; a business deal.

Then it’s clear that this wasn’t a transaction.

You could say “fundamentally, transaction is any exchange of value” and that David “exchanged” me value by writing the book, and I then “exchanged” him value by giving him credit. Except at the time that I got value from David’s book, it wasn’t an exchange; it was more like a gift of insight. And I’m not giving him a cred edge back because I’m exchanging Cred for his showing up and doing something useful on this forum later; I just think it’s the right thing to do.

There is a difference between reciprocal gifts and a transaction.

Pedantry You could say that David sharing his ideas was a transaction of the value of knowledge for the value of having influenced other people, and that my recognizing David is a transaction of cred for the value of being seen as a fiar person, or some such.

You could also say that rain is a transaction of thermal energy between water vapor in a cloud and the surrounding atmosphere. At a certain point definitions become so broad as to be specious.*

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