Tokenization changes OSS development

This article is a revised version of Dev Protocol’s Medium article, “The Tokenization of Open Source”, for Japanese readers. (And this is the English version of it.)

The idea that Opensource Software cannot be a business model is an ancient myth.
According to a survey made by OSS Capital, a VC specializing in COSS (commercial OSS), the market size has already expanded to around 10 trillion yen in the COSS world.

• $17.5 billion revenue
• $138.7 billion market value (7x revenue multiples)
• $67.24 billion in exits
• 50 thousand employees

COSS business models: 1) Open Core and 2) Support Subscription.

My Thesis: We’re likely to see Tokenized Opensource Software Companies (TOSS) as the 3rd model when they can leverage:

- COSS models for monetization
- Network efforts (driven by incentive distribution)

— Greg Osuri (@gregosuri) August 12, 2019

This company index of COSS referred to in this tweet was created in 2013. TOSS is a new model in which you can leverage its growth.

Benefits of Tokenization permalink

“T” in TOSS stands for “Tokenized”.
TOSS (Tokenized Opensource Software) is the latest type of OSS using blockchain.

Let us talk about blockchain briefly.
One of the core functions of blockchain is that you can tokenize everything. You can unlock items’ value and easily transfer them by tokenization. It matches you with third party’s incentives and acts as a bridge with different communities.

We mean, eligible tokens themselves have a potential to build a sustainable and efficient economic model. Currently, tokenization of various assets such as art, real estate and tesla stock is increasing. In OSS world, there is also an growing need for tokenization.

Today, Dev Protocol is the only option that realizes TOSS.

TOSS for the next generation permalink

A new way to fund open source?

- Be open source dev
- Issue a token
- Hold X% of it
- Has 0 value initially
- Award (100-X)% of it over time to folks who contribute code
- Companies then buy token to prioritize bugs & features
- Suddenly, an economy arises!

— balajis.com (@balajis) November 10, 2020

Dev Protocol brings about numerous benefits for all Github users by easy tokenization of OSS. It shares incentives with all community members involved, and leads to the growth of community-driven network.

TOSS of Dev Protocol permalink

Introduction permalink

TOSS created through Dev Protocol proves ownership of the OSS and can be shared with everyone involved in the project. Owners can freely set up who to share and how much to distribute, such as maintainers and contributors.

Holders of TOSS can utilize the following various use case.

1. Grant farming permalink

The biggest feature of Dev Protocol’s TOSS is a sustainable incentive model instead of donation.
By using Dev Protocol's sponsorship platform Stakes.social, OSS developers can get sponsors and monetize their OSS.
“Yield farming” is a method where you get profits by obtaining interest and commission income through the loan of money to DeFi(Decentralized Finance) service. The feature of Dev Protocol is an altruistic yield farming. OSS sponsors can grant DEV for OSS, while increasing the number of DEV for themselves. Since OSS sponsors can increase their money during their support for the growth of OSS projects, they can realize more sustainable fundraising for OSS ecosystem.
For more details: Dev Protocol rather than donation service

2. Automatic distribution of reward permalink

DEV token for creator reward is automatically distributed in accordance with the ownership rate of TOSS.
Owners of OSS can freely set up the amount to distribute as well as designate people, including development team and contributors, to share TOSS. TOSS can be calculated to 18 places of decimals. All the team members involved in the project can receive DEV token.

example) If a year cumulative total of the creator reward for an OSS project is 1000 DEV,

• Reward for an owner holding 50% of TOSS: 500 DEV per year
• Reward for contributor A holding 30% of TOSS: 300 DEV per year
• Reward for contributor B holding 20% of TOSS: 200 DEV per year

*This is one of the examples. Owners of OSS can freely set up the amount to distribute and people to share TOSS. It is also possible for only the owner to have it without sharing.
*Holders of TOSS can withdraw DEV at any time.

3. Commit farming permalink

With commit farming, you will be able to distribute a part of TOSS to contributors every 1 commit in GitHub. By holding a part of TOSS, contributors can receive the distribution of creator reward as a member of the project.
The same incentive model like this is adopted by EEA Trusted Reward Token (Github), which gives reward to firms that have completed achievements and tasks designated by EEA (Enterprise Ethereum Alliance) board.

4. Governance permalink

The governance model of OSS is vital when we manage projects. Dev Protocol is seeking a governance function which should be built on TOSS. If holders of TOSS can vote for the project policy, it is highly valuable for stakeholders including companies that rely on OSS, which could result in the increase of demand for TOSS.
Please let us know your opinion at DIP.

5. Sponsor Perks permalink

You can add incentives to increase an opportunity to be sponsored by giving sponsors perks that can be obtained only by sponsors such as the support of OSS and closed contents.

6. Liquidity mining permalink

Liquidity of token is important in terms of the enhancement of token’s value. You can give liquidity mining as a reward for mining token to provide liquidity with participants. You can introduce liquidity mining of TOSS for OSS projects, and add incentives to increase an opportunity to be sponsored.

7. OSS ETF permalink

At the time of issuing TOSS, Dev Protocol can become ETF that is subject to OSS when Dev Protocol Treasury receives a part of issued TOSS.
Dev Protocol Treasury will eventually be administrated by DAO and it holds portfolio of TOSS. Then, if creators validate the governance of TOSS, Dev Protocol Treasury acquires a right to receive DEV from creator reward as well as vote right. Holders of DEV vote for the way of distribution (including burning) of creator reward, and get a right to vote for OSS. Implementation of this process encourages DEV to obtain certain percentages of protocol’s value and to become a metagovernance tool.

8. Limitless possibilities of use case permalink

As Dev Protocol is open as OSS, everyone can develop Dapps using Dev Protocol, which makes it possible to design the use case of TOSS. Because it’s decentralized, TOSS of OSS projects, which have already joined Dev Protocol, can also participate in your Dapp from the beginning.

Have you got any ideas for use cases or Dapps that you want to develop?
Read the document, and start developing.
📗GitBook
👩‍🍳How to create Dev Protocol Dapp 1,2,3

Interested in TOSS creation? permalink

Thank you for reading this article.
I hope this gives you an idea of the future that Dev Protocol team are trying to change.

If you use Stakes.social, an application for Dev Protocol, you can easily create TOSS for your GitHub repository. Application for the tokenization of Stakes.social is now invitation-request only.

You can apply for your request here: (It takes about 30 seconds.)
https://stakes.social/invite/github