This post was written by Kagami. Thanks to DAO Masters contributors David Burt, Andi Schuster, and Maryam for their research, as well as Nelson for their edits and revisions!
Bounty programs unlock the power of decentralized work for DAOs. Bounties are tasks and projects that a DAO shares with its contributors and community to complete. These tasks may range from document translations and meeting notes to building products on top of Layer 2 chains like Optimism and Polygon.
DAOs are discovering how bounty programs may empower current and potential contributors to engage, organize, and complete value-added tasks. While there is no set template for developing an effective bounty program, many DAOs are experimenting with different types of bounties, structures, and platforms.
There are three broad types of bounties that are used in most bounty programs–DAO-created, contributor-driven, and sponsored. Bounty programs may use a combination of these three types to accomplish their specific goals.
A guild or team within a DAO will create bounties for certain tasks and projects. In this hands-on approach, teams spend the time to scope out the project, develop the vision and goals, and screen contributors to determine fit. This may also require a DAO to appoint members that oversee and manage the entire bounty process.
At Raid Guild, account managers manage bounties. They are experienced stewards who articulate the vision and goals of the project, assess contributor-bounty fit, and create a positive onboarding experience. Aragon uses a similar framework for some bounties through a one-on-one screening process to evaluate contributor-bounty fit.
Decentralization creates opportunities for contributors to take the initiative to propose projects that may add value to a DAO. Some DAOs such as Bankless and Forefront share open-ended bounties around specific areas of interest for contributors to craft proposals. Members review and vote to fund specific proposals that meet the criteria of these open-ended bounties.
Bankless and Forefront generate quality content through contributor-driven bounties. They use an open-ended call for content where contributors can write and submit articles. These articles are reviewed and compensated by members of each DAO.
Hackathons gather talented individuals and teams around large bounties that web3 companies and protocols sponsor. In many cases, companies will pool resources to incentivize teams to organize over a set period of time to compete for a bounty. These bounties serve as a way to draw developers to build on top of emerging protocols and services.
Gitcoin produces two types of hackathons–open and exclusive. In open hackathons, the Gitcoin event team reaches out to sponsors to fund bounties and the production of the event. For exclusive hackathons, web3 companies approach the Gitcoin event team to produce a hackathon. In both cases, Gitcoin develops the narrative, bounties, and prizes for the hackathon and promotes it to their network of over 30,000 developers.
Bounties vary in scope, skill, and compensation. Many DAOs develop different levels of access for specific bounties depending on the requirements. Some bounties will require express approval to complete from the DAO (permissioned) while other bounties require no approval to complete (permissionless).
Permission bounties create a low barrier to entry for potential contributors to a DAO. These allow people to signal interest by completing small bounties that provide value to the DAO in exchange for compensation. Permissionless bounties require no prior approval from the DAO and may include day-to-day tasks such as taking meeting notes, translating pages, and completing minor pull requests.
Juicebox and Aragon use permissionless bounties for day-to-day tasks like taking meeting notes and translating pages. DAOhaus also has a permissionless GitHub filled with issues that new contributors can tackle.
Permissioning enables DAOs to add a layer of security for bounties with more complexity and larger compensation. In many cases, these bounties are completed by current DAO members that have an established track record. Token-gating is a common technique to gate permissioned bounties by requiring specific tokens and Discord roles.
Gitcoin’s bounty platform utilizes permissioning by requiring people to connect their GitHub profile before they can view bounties posted by companies. This allows companies to verify the skill and intent of developers by reviewing their GitHub to develop a layer of trust prior to accepting their work for a bounty.
A great bounty post sets up potential contributors for success. They concisely outline expectations, deliverables, deadlines, and compensation. Many posts optimize for skimmability and share all relevant information and resources necessary for completion. 1Hive’s bug bounty program is a great example of a well-written bounty.
The start of a post should give a high-level overview of the bounty. The 1Hive Bug Bounty post shares a succinct overview of the bounty program including the scope, evaluation process, compensation structure, and the wallet where funds are held.
The next section outlines the specific tasks or requirements that are necessary to complete the bounty. This should make it easy for potential contributors to complete and submit bounties. 1Hive structures its requirement area for skimmability with bullet points and outlines its expectations.
Every bounty should be compensated. Many DAOs use web2 market rates to determine compensation for bounties. 1Hive provides a detailed compensation structure based on the CVSS Risk Rating Scale along with examples of how previous bug bounties were scored. This transparency helps potential contributors determine whether they would like to complete the bounty.
Providing examples of previously compensated submissions gives people a guide for formatting and claiming a bounty. This may also reduce the friction for people that want to complete their first bounty. 1Hive provides two examples for potential contributors.
DAO tooling for bounty programs is still nascent and developing. While there is no specific tech stack, there are some common platforms used by DAOs. These include Discord, Notion, Dework, and GitHub. In addition to these platforms, Gitcoin created its own bounty platform for developer bounties and Bankless developed its own in-house platform to share with the broader web3 community in the future.
Discord is the defacto communication platform for DAOs. Discord may serve as the nexus for bounty communications. This may include sharing new bounties, team organization, submissions, and token-gating for permissioned bounties.
In the DAOhaus Discord, people that select the “contributor” role unlock a specific channel dedicated to potential and current contributors. This channel allows people to communicate with members, ask questions about specific permissionless bounties, and share completed bounties.
Notion is a project management and note-taking software that DAOs may use to manage bounty programs. Notion allows DAOs to post, track, and share open bounties. Clarity and Charmverse are two web3 solutions that use an interface similar to Notion with features like wallet connect, token-gating, and bounty payments.
Forefront is an example of a DAO that uses Notion for open community bounties. The page shares permissionless bounties that anyone can tackle and submit via a form for compensation in FF tokens.
Dework is a web3-native project management platform with token payments, credentialing, and bounties. This platform specifically addresses bounty program management and makes it easy to manage the entire workflow from start to finish.
Many DAOs are beginning to experiment with Dework as they launch bounty programs. BanklessDAO Marketing Guild and Aragon Network DAO are examples of DAOs testing Dework with technical and non-technical bounties.
GitHub is a code hosting platform for version control and collaboration. GitHub is a way for developer-focused DAOs to manage bounty programs, review and accept fixes, and share necessary documentation.
Bounty programs are a powerful tool that can empower contributors to apply their skills to drive value for DAOs. Building an effective bounty program requires careful consideration of the types of bounties, processes, and platforms that drive the most value for a DAO. While there is no one size fits all bounty program, many DAOs can benefit from planning and implementing a bounty program.