[DRAFT] Celo Cosmo-Local Credit Network - Season 1 Funding Proposal

Governance Governance Proposals
1
  • Title: Celo Cosmo-Local Credit Network
  • ReceiverEntity: Celo Governance
  • Status: [DRAFT]
  • Author(s): Grassroots Economics; Will Ruddick (@WillRuddick), Mohamed Sohail (@kamikazechaser)
  • Type of Request: Funding
    • Intent: Season 1
    • Funding Category: Regional Community Growth
    • Funding Request: $309,000 worth represented in 300,000 cUSD, 30,000 CELO (CELO tokens valued at an average price of $0.3)

TL;DR

Celo Governance to seed 300,000 cUSD and 30,000 CELO to a Global Commitment Pool Fund, governed by a Stewardship Council, disbursed in parametric tranches, to launch a cosmo-local credit network: top-level pool → cascading regional pools → thousands of shops, groups, and projects transacting daily on Celo.

“Commitment in, cUSD out. Trust moves value. From accountable promises to a shared safety net.”

At-a-Glance (Request, Admin, Sustainability)

  • Total requested: (300,000 cUSD / 30,000 CELO) held in top-level escrow
  • Tranches: Released by parametric triggers (tx/day, fulfillment, utilization)
  • Administration (Season 1 pilot): ~20% program overhead across tooling, training, monitoring, and stewardship (see Budget)
  • Maintenance (long-term): Minimal swap-fee routed to a pooled Maintenance & Public Goods Fund (no private gain) + partner co-funding; goal is to cover monitoring + ops by Month 12-18
  • Future seasons: only if scale targets and new regions are added; core pool can self-maintain once swap volume grows (see Sustainability)

Summary

We propose seeding a cosmo-local credit network on Celo: a system of on-chain Commitment Pools that convert local promises (tokenized vouchers) into interest-free, trust-gated credit for small businesses, humanitarian groups, and regenerative projects across the long tail of the real economy. Funding flows from a top-level pool (multi-sig escrow) in tranches, unlocked by parametric triggers tied to on-chain performance (TVL, daily transactions, fulfillment rate), and routed to cascading regional/community pools stewarded by trained champions.

This proposal seeks governance approval under the Season 1 intent of: Regional Community Growth.

Components & Interactions

  • Top-Level Escrow: holds cUSD/CELO; releases tranches on KPI proofs.
  • Regional/Community Pools: accept issuer ERC20 vouchers as seed; enable interest-free swaps for needed assets.
  • Issuers & Guarantors: schools, projects, shops, groups stake their own vouchers; guarantor circles gate trust.
  • Oracles & Dashboards: on-chain KPIs (tx/day, fulfillment, utilization) attest tranche unlocks; public dashboards show Financial & Economic TVL.
  • Access Layer: Existing smart phone wallets, QR/NFC powered PoS, USSD wallets (no/poor internet connectivity).

Budget & Phasing

Request: 300,000 cUSD (Escrowed, tranche-released)

Category Amount Notes
Liquidity Buffers (5+ regions) 80% escrowed
Contracts & Integrations 5% registry, pools, escrows, subgraph, audits
Training & Onboarding 5% ToTs, kits
Monitoring & AI Reporting 5% DeepGov + dashboards
Stewardship Council 5% Stewards Governance work

Request: 30,000 CELO (Escrowed, tranche-released)

Category Amount Notes
Gas sponsorship 100% Onboarding users and businesses

Phase 1 (0-3 mo): pilot 5 regions, KPI oracles live, first tranche(s).
Phase 2 (3-6 mo): cross-pool routing, inter-regional swaps, fee policy vote.
Phase 3 (6+ mo): expand to additional regions, open forks by aligned partners.

Sustainability (Season 2+)

  • Maintenance Fund: swap fee (pool-configurable) routed to a pooled Maintenance & Public Goods Fund; covers monitoring oracles, light stewardship, and community adoption kits.
  • Target Coverage: steady-state ops covered when monthly gross swap volume × fee bps ≥ monthly maintenance budget.
  • Illustrative math: if monthly swaps reach $1.5M and fee is 5 bps (0.05%), monthly maintenance = $750. Tune bps only if needed; no interest to borrowers.
  • Co-funding: regional partners (councils, NGOs, universities) may co-finance training and kits.
  • Future seasons: requested only to expand regions or increase buffers; otherwise, maintenance comes from the pooled fund + partners.

Objectives

Key outcomes for Celo:

  • Daily transactions: frequent deposits, swaps, and redemptions recorded on-chain.
  • Durable TVL: seeded cUSD/CELO remains escrowed; value is mirrored by incoming tokenized commitments (“Commitment in, cUSD/CELO out” with TVL reported as Financial TVL + Economic TVL).
  • Mass adoption at the edge: QR Codes, NFC chips and PoS devices at local small businesses, USSD support, festivals/markets onboarding, Tuition fee assistance programmes e.t.c.
  • Forkable public goods: open contracts and code, templates, and reporting standards; easy to extend across DAOs, SMEs, and humanitarian partners.

“We are a murmuration, no one survives alone. This network makes cooperation legible and fundable on Celo.”

Why Celo & Why Now

  • Long-tail growth: Real-world SMEs, informal groups, and humanitarian circles represent the majority of economic activity but are under-served by DeFi primitives.
  • No-interest alignment: Islamic-finance-compatible (no riba), humanitarian-ethics aligned credit.
  • Cosmo-local fit: Locally governed pools, globally connected for routing and learning, ideal for Celo’s mission and vision for 2030.
  • Coordination Note: We intend to co-design implementation with existing Regional DAOs and welcome a designated seat or liaison in the Stewardship Council.

What We’re Building

1. Top-Level Pool & Stewardship Council

A top-level pool (multi-sig) funds regional/community pools in tranches. Borrowers at this level are regional pool stewards who leave commitments (service vouchers, reporting duties) when drawing cUSD liquidity. Tranches unlock via parametric triggers tied to on-chain KPIs.

Prospective Stewardship Council (subject to confirmation)

  1. Cauê (Coi) Tomaz (@coi) - Greenpill Brasil
  2. David Dao (@ddd) - GainForest
  3. Mohamed Sohail (@kamikazechaser) - Grassroots Economics
  4. TBD…

Quorum 5/7

Stewardship Council roles and responsibilities:

  1. Approves tranches
  2. Reviews monthly and seasonal reports
  3. Enforce and arbitrate clawbacks
  4. Ensure forkability and neutrality

The stewardship council acts as an accountability layer providing neutral oversight.

2. Cascading Regional / Community Pools

Regional champions (ToTs) onboard small business networks, humanitarian groups, universities and regenerative projects. Pools are trust-gated via group guarantors and track fulfillment on-chain. Each swap/ redemption generates transactions on Celo.

3. Training & Tooling

  • Train the Trainers (ToTs): regional champions in facilitation, pool ops, compliance, reporting.
  • Visionary approach: practical playbooks + community storytelling to drive adoption.
  • Tooling: voucher registry, pool accounting, QR/alias payments, simple wallet flows, POS integrations, and AI-assisted reporting (DeepGov) for auto-generated dashboards.
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How It Works (Core Mechanics)

  1. Core Primer: Cosmo Local Credit (must read).
  2. Animated Video: Dip your Toe in Commitment Pooling.
  3. Example: LuKenya University student loans.

(See below for a full Example in Kilifi Kenya.)

Borrower flow: Application → Seeding → Credit → Swap → Redemption → Impact

  1. Application: purpose, outputs/impacts, repayment period, guarantors, voucher collateral, requested credit line. Never a donation, always an endowment-style loan.

  2. Seeding: member/endorsed group deposits their own vouchers into the pool (endowment).

  3. Credit Line: up to 3× seed as borrowing (swap) capacity (configurable by pool).

  4. Swap (Borrowing): Loan = Swap member’s voucher in; needed asset/cUSD out.

  5. Debt: the value of the member’s own vouchers held by the pool.

  6. Redemption:

    • Borrower swaps back equivalent assets to pull out their vouchers; or
    • Others swap approved tokens to remove borrower’s vouchers (taking on the claim), then redeem directly with the borrower.

  7. Reporting & Continuation: short Outcomes & Impact report; limits adjust based on fulfillment.
    TVL Invariance: On-chain Financial TVL (escrowed cUSD in top-level + regional escrows) stays stable; when cUSD is disbursed to merchants/beneficiaries, an equal value of tokenized commitments is staked. Economic TVL = Financial TVL + Mark-to-Index Value of Vouchers Held in Pools.

Illustrative Example: Kilifi, Kenya (Schools & Shops Pool)

Purpose: Demonstrate how a place-based network applies for a regional/community pool and operates within the protocol.
Applicant Entity (illustrative): Kilifi Schools & Shops Collective (community association; ToT-led).
Regional Champions (ToTs): 2 facilitators rooted in Kilifi; trained in pool ops, guarantor verification, and reporting.
Constituency (initial): ~5 schools (tuition & meals), ~30 neighborhood shops (food, repair, transport, clinic hours), 3 market associations.
Seed Commitments:

  • Schools mint tuition-credit and meal-credit vouchers (term-limited; redemption on campus).
  • Shops mint goods/service vouchers (face value, redemption at point of service).
  • Target combined seed (illustrative): set per pool policy; each issuer stakes an initial tranche of own vouchers.

Credit Lines:

  • Per issuer: up to 3× seed (pool-configured), capped during pilot.
  • Guarantor-gated: PTAs and market committees act as guarantors for issuers.

Swap Use-Cases:

  • A school swaps its staked vouchers for cUSD to procure textbooks; later redeems by accepting vouchers from parents at fee payment.
  • A grocer swaps in own goods-vouchers to draw cUSD for inventory; redeems when neighbors present vouchers at checkout.

Operational Flow:

  • Application → Seeding → Credit → Swap → Redemption → Reporting, with all events on Celo. Paper-first QR cards and USSD flows available for low-tech phones.

Parametric Triggers (defaults):

  • ≥25 active issuers by month 3; ≥1,000 active wallets and ≥600 daily tx by month 6; ≥95% fulfillment (rolling 90d); utilization 30;80%.

Reporting & Dashboards:

  • Public dashboards show tx counts, utilization, fulfillment, Financial/Economic TVL; monthly human-signed summaries.

Risk & Mitigation:

  • Staged limits; guarantor replacement; voucher auction path for persistent non-fulfillment; pause rules via oracles and Council.

Tranche Path (pilot):

  • Tranche 0: minimal operational grant-in-escrow for QR/USSD kits and training (from the 5% Training/Monitoring allocations).
  • Tranche 1: initial regional liquidity buffer released upon issuer roster + dashboard live + oracle endpoints verified.

Governance, Risk, & Ethics

Constitutional Framework (forkable)

  • Templates: applications, guarantees, MoUs, impact reports.
  • Quarterly & annual reports: on-chain proofs + narrative.
  • Clawback: tranche-based release; non-performance triggers return of unspent cUSD.
  • Retroactive accountability: persistent non-fulfillment → auction/exit of borrower’s vouchers, limit drops to zero, guarantor engagement.

Administrative Plan (pilot)

  • Tooling-first: automate attestations and reports; minimize manual approvals.
  • Thin stewardship: Council acts as neutral oversight; no private fee flows.
  • Standard templates: applications, guarantor forms, MoUs, impact notes to keep ops lean.
  • Capacity building: ToT training reduces central admin load by Month 3-6.

Intent - Humanitarian & Faith Alignment

  • No interest (riba); fees (if any) are transparent, minimal, and routed to maintenance/social funds (no private gain).
  • Inclusion: extremely vulnerable members join via proxy issuance + guarantors; no one excluded for lack of smartphones or cash.
  • Data minimization: public-but-minimal ledgers; consent for any personal data.
  • Small/Medium Sized businesses
  • Universities (Student loan programs)
  • Humanitarian Actors
  • Regional Actors (Local DAOs)
  • Celo Vision 2030

Parametric Triggers (Tranche Unlocks & Clawbacks)

Per‑region defaults (Council‑adjustable):

Metric Trigger Evaluation Window Effect
Daily Transactions ≥ 600/day by month 6 rolling 30‑day unlock next tranche; continue monitoring
Wallet Onboarding ≥ 1,000 active wallets by month 6 90‑day active unlock next tranche
Merchant Issuers ≥ 25 active by month 3 rolling 30‑day unlock / maintain tranche
Fulfillment Rate ≥ 95% rolling 90‑day maintain credit limits; <95% → haircut/index review
Liquidity Utilization 30;80% band rolling 90‑day <30% → reallocate: 50% to high‑performing regions; 50% to local incentives
TVL Reporting weekly Financial & Economic TVL weekly snapshots gatekeeper for tranche release

Tracking: KPI data attested via Dune, Divvi or the GrassEcon tracker/indexer stack.
Automation: KPI oracles sign aggregate proofs; exceptions require Council sign‑off. Failure modes (late data, oracle discrepancy) default to pause‑and‑review.

Application Process (for Groups & SMEs)

  1. Intent & Fit: one-pager on purpose, outputs, seasonal timing, requested line.
  2. Endowment: initial voucher seed (min/max by pool).
  3. Guarantors: named, verified; pictures of paper ledgers acceptable where relevant.
  4. Credit Terms: target line (≤3× seed), timeframe, collateral type.
  5. Approvals: champion pre-screen → pool committee review → Council (for larger lines).
  6. Penalties: late/non-fulfillment → temporary suspension; guarantors redeem/replace; auction route available; repeat defaults → limit zeroed.

Technical Architecture (Celo)

  • Voucher Registry (ERC-20) with metadata for issuer, type, face value, expiry, and redemption rules.
  • Pool Contract: tracks Debt = issuer vouchers held, Credit = limit − debt, enforces swap parity/indexing, records redemptions.
  • Release: hold cUSD; tranche releases bound to KPI oracles (Working indexer/tracker stack).
  • QR / USSD / POS: alias/ENS payments, paper QR cards, NFC cards. merchant POS apps.
  • Solvers & Routers (roadmap): cross-pool pathfinding (D→B→C→A), future flash-swap/flash-loan for atomic routing (no borrower interest; protocol-level swap fee applies).
  • Open & Forkable: repositories, schemas, and governance docs under open source licenses.

Training & Regional Champions

  • ToT Program: local champions trained in pool curation, credit limits, swaps, reporting, dispute resolution.
  • Vision & Practice: experiential simulations, market-day activations, festival onboarding.
  • Materials: ledgers, QR kits, POS how-tos, USSD scripts, AI reporting assistants.

Adoption Plan (Seasonal & Place-Based)

  • Seasonal intents: time credit to agricultural cycles, school terms, holiday festivals.
  • Regional markets: grocery shops, repair kiosks, barbers, eateries; everyone onboarded to Celo.
  • Examples: weekend market “voucher fairs,” school-fee campaigns, clinic days, neighborhood clean-ups.

Note: All activity must touch Celo: voucher mints/transfers, swaps, redemptions, escrow releases, KPI proofs.

Incentives & Fees (Beyond DeFi, but compatible)

  • Swap Fee (bps): optional, minimal; split between maintenance fund, council ops, and public goods (Celo PG).
  • Liquidity Incentives: Council may allocate fee-share to liquidity supporters (non-extractive design; no borrower interest).
  • ROI & SROI:
    • ROI for Celo: TVL retention, transaction growth, wallet growth, merchant retention.
    • SROI for communities: crisis bridging, job-hours fulfilled, food/care delivered, local spend recirculation - with active impact reporting on sarafu.network.

KPIs (Tracked On-Chain; Gate Tranches)

  • Daily Transactions: ≥600/day/region by month 6
  • Wallets: ≥1,000 active wallets/region by month 6
  • Merchants: ≥25 active voucher issuers/region by month 3
  • Fulfillment Rate: ≥95% rolling 90-day
  • Liquidity Utilization: 30;80% target band; reallocation below 30%
  • Inter-Pool Trades: ≥3 cross-regional swaps by month 12
  • TVL Reporting: weekly Financial & Economic TVL

Reporting & Transparency

  • Public dashboards: tx counts, TVL, utilization, fulfillment, geo-tags (optional), stories.
  • Monthly reports: auto-generated with AI (DeepGov); human-signed; council-reviewed.
  • Yearly synthesis: ROI/SROI including Seasonal Intent outcomes.

Risks & Mitigations

  • Default risk: guarantor design, staged limits, fast routing to replace debt, retroactive auctions.
  • Under-utilization: parametric reallocations; local incentives (merchant promos, swap fee rebates).
  • Complex UX: USSD/QR/POS support; ToT field training; paper-first fallbacks.
  • Ethics: no interest, transparent fees, minimal data, inclusive access.

Why This aligns with the Season 1 intent

  • TVL doesn’t erode: escrowed cUSD stays; commitments come in as measurable collateral.
  • Daily transactions by design: every step is on-chain.
  • Long-tail vision: A local merchant/grocery shop is a first-class citizen.
  • Interoperable & forkable: aligns existing Celo groups into a connected commons with high TVL and transactions.
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Wow. Nice range of commitment pools to support.

https://sarafu.network/#seeders

First time supporter and it was fairly easy to sign up, review options and opt to support 4 initiatives (pools).

Promising

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This proposal represents the kind of economic sovereignty infrastructure we need to build truly free societies. As a Celo Scout and CEO of Funding the Commons, I’ve been watching Grassroots Economics’ work with deep admiration for many years - your commitment to community-driven financial systems aligns with the principles of self-governance and autonomy that I believe are fundamental to human flourishing.

One thing I love about this proposal is how it embodies the cosmo-local principle: locally governed pools that maintain community autonomy while connecting to a global network for learning and resource sharing. This mirrors sovereignty concepts I’ve explored - the idea that true freedom comes from communities having control over their own economic inputs and outputs, rather than being subject to extractive systems imposed from above.

Grassroots Economics brings exactly what Celo needs: proven experience in community currencies, deep relationships with grassroots organizations across multiple regions, a philosophical commitment to interest-free, trust-based economic systems, and a battle-tested community treasury management system that predates Celo and blockchain generally, going back to the era of Grassroots Economics/Bangla-Pesa printed paper currencies in early 2010’s Kenya. Will’s work demonstrates that alternative economic models aren’t just theoretical - they’re practical solutions that can serve the long tail of the real economy (what I’ve been calling “RealFi”) that traditional DeFi has largely ignored.

The technical architecture you’ve proposed is compelling. The parametric tranche system creates accountability without bureaucracy, while the cascading pool structure preserves local autonomy within a globally connected framework. The fact that 80% goes directly to liquidity buffers shows this is about real economic impact, not organizational overhead.

I have a few constructive observations:

  • First, the Stewardship Council composition looks strong, though I’d love to see how you plan to ensure diverse regional representation as the network scales.
  • Second, the sustainability model through swap fees is elegant - it aligns incentives perfectly and avoids the extractive dynamics of traditional credit systems.

Most importantly, this proposal directly advances Celo’s core objectives. The daily transaction volume from thousands of shops and groups will demonstrate real-world utility. The durable TVL model, where “commitment in, cUSD out” creates both financial and economic value, is innovative. And the focus on QR codes, NFC, and USSD support will bring crypto adoption to communities that have been systematically excluded from financial innovation.

This isn’t about funding a project - it’s about seeding infrastructure for economic self-determination. When communities can create their own credit systems based on local trust networks rather than distant credit scores, we’re building the foundation for genuine economic sovereignty.

Will’s proposal helps showcase Celo’s ecosystem as an example of blockchain technology serving human flourishing.

I strongly support this funding request and look forward to seeing how this network evolves into a model for community-controlled economic infrastructure worldwide.

David Casey

Celo Scout
CEO of Funding the Commons

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Reading this proposal, having followed the micro loan and commitment pooling space for years, makes me hopeful for the future. This is precisely the type of use case that blockchain can enable to truly transform the system from the ground up.

The use case narrative cannot be underestimated or undervalued in this instance as one of the greatest barriers out there for the skeptical masses is that all crypto is a scam or at best just the same economic racket in a digital form, this would go a long way to validate a new system thesis. Micro loans have long proven to be some of the most secure investments out there with far higher repayment rates, yet the overhead for creating them has prevented their broader adoption. Commitment pooling and blockchain with a sustainable endowment style funding mechanism solves this problem as the overhead drops significantly while the real world improvements grow at exponential rates.

I will continue to watch this proposal closely with hope for the future.

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This proposal feels like a natural evolution of Sarafu’s journey.

I strongly support this proposal and would be honored to contribute with the perspectives from my Region.

Starting with the perspective of Greenpill Brasil and the Regen Rio de Janeiro program, which are onbording new users to sarafu weekly. I’d like to share some reflections and complements:

In Regen Rio we have been piloting a structure where financial pools (managed nationally) and commitments pools (managed locally by a regional commission) work together. What has been powerful is not only allocating financial credit through the program, but explicitling how social, cultural, and ecological commitments are embeded with regenerative values, and sarafu is making this value more tangible while creates accountability.

The Regen Rio commission was recently formed with 4-7 representatives from participating projects. They now have their own multisig, and they are exploring credit thresholds, renewal rules, and community-based guarantors. It’s still early, but it shows the potential of commissions as stewardship units within the cosmo-local network, the champions of their region.

One of the biggest challenges is making regenerative outputs, outcomes visible and interoperable. So we’ve been experimenting with reporting through Karma GAP using CIDS, which can anchor local pools activity into a transparent and interoperable impact ledger.

I definetly see the cosmo-local credit network as an opportunity to interconnect multiple bioregional hubs (Rio, Bahia, Espírito Santo, São Paulo, and beyond), where Greenpill Brasil can serve as a bridge, ensuring that each Biorregional Facility remain rooted, while connected to the broader Celo ecosystem. So, i believe the Regen Rio pilot can serve as a reference point for how regional orgs can align with the cosmo-local approach while staying true to regeneration on the ground.

I’m excited to see this come to fruition.

Best regards and abraços from Brazil,
Coi
Greenpill Brasil Steward / Regen Rio de Janeiro Advisor

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I’m Paul - Project Lead for Gardens (app.gardens.fund). I support this proposal.

Over the last few months I’ve worked a bit with @WillRuddick on mapping out possible governance routes for the Stewardship Council and Sarafu’s Commitment pools and have a lot of confidence in him and his team’s ability to execute on their vision.

I find the cosmo-local ethos extremely compelling - growing an interconnected network through many independently governed bottom-up communities, each with the right context to make the right decisions for their local issues. This is how we scale healthy systems and build resilience :seedling:

Sarafu’s existing real world adoption is an outlier in this space, and should make it a priority investment in my opinion.

Happy to support this work with any Gardens integration that might be useful as well!

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GM GM

My name is Nick and I’d like to echo Coi’s reflections and add my perspective, as one of the participants in the Regen Rio round, and now looking forward to giving continuity to the round, while currently active in different roles within the GPBR community.

From what we are building on the ground, I see this proposal as a catalyst for glocal impact: onboarding new projects to use SARAFU and that align with regenerative values, while strengthening local commerce and expanding the real use of crypto in the city. Through Regen Rio we’ve already seen how curiosity turns into action when people are invited to experiment with crypto in tangible ways, from regional commissions to community-led events.

This initiative can amplify that energy, creating more touchpoints for onboarding, hosting local experiences that demystify crypto, and fostering adoption through regenerative commitments that people can relate to in their daily lives. I believe this is a way to ensure that local actors are empowered, while staying interconnected with the broader ecosystem.

I’m confident this action has the potential to generate strong ripple effects in brazilian communities and beyond, and I’m excited to contribute to making it happen.

Abraços,
Regen Rio Representative / GPBR Member

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I’m David Dao, co-founder of GainForest and DeepGov - and we fully support this proposal as well as accept the nomination to be part of the Stewardship Council.

This year, GainForest has had the privilege of partnering closely with Grassroots Economics on several initiatives exploring cosmo-local finance and AI-assisted governance tooling (see more on our blog post)

We’ve seen firsthand how @WillRuddick @kamikazechaser and the Grassroots Economics team combine deep local experience in community currency networks with a rigorous on-chain accountability framework in their work in Kenya. Their approach aligns closely with Celo’s mission: real-world impact, regenerative economics, and inclusive financial infrastructure for communities often excluded from traditional finance. There is rarely a more inspiring project in web3 like Grassroots Economics.

At GainForest and DeepGov - and together with Grassroots Economics - we’ve been pioneering AI-powered reporting across 43 local communities and in three Gitcoin rounds (GG23)—distributing over $50K so far, with $150K planned for GG24—to ensure funding disbursements are transparent, data-driven, and credibly neutral, making funding flows auditable and scalable as adoption grows.

We fully support this proposal because:

  1. It creates local trust networks connected through Celo’s infrastructure.
  2. It leverages open-source tooling and public dashboards for transparency.
  3. It sets the stage for sustainability through community stewardship rather than top-down grants.
  4. It aligns with Celo’s values as discussed in Towards Celo’s Cultural Manifesto.

As @rene_celo highlighted in Celebrating Celo’s Five Years & Vision 2030: A Trillion-Dollar Onchain Economy Built on Celo & a Battle For Crypto’s Soul, Celo is battling for Crypto’s Soul — a time where we need to scale real-world impact, onchain economies, and regenerative solutions at a truly global level with a deep consideration of Celo’s values. This proposal is a concrete step toward that vision.

In our view, this is exactly the type of cosmo-local coordination mechanism that Celo should be pioneering: local autonomy, global interoperability, and measurable impact.

Therefore, GainForest is proud and excited to continue collaborating with Grassroots Economics, the Stewardship Council, and regional partners to ensure Season 1 succeeds.

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How This Proposal Can Help Unite Celo

Celo family, thank you for the thoughtful engagement so far. For me this proposal is a way to complement existing Celo efforts like Celo Public Goods, Prezenti, and the Regional DAO programs. We’re not asking to pull resources away. We want to lock value into a shared network of commitment pools so that grants, prizes, and regional funds can recycle as zero-interest credit - building durable usage and trust on Celo.

Why this brings us together

  • One commons rail for many programs. Any Celo program (and their members) can apply for a zero-interest, cosmo-local credit line on the same rails.

  • Accountability that strengthens the network. As long as participants fulfill their commitments—by returning what they drew or repaying in-kind—their credit line revolves. This keeps value circulating, grows TVL, and drives everyday on-chain activity.

  • Inclusion beyond crypto-native circles. Universities, students, shop owners, farmers - people for whom a zero-interest line of credit can be the difference between stalling and thriving.

  • Interoperable by design. Programs stay independent but interlink through shared pools, reporting, and a thin Stewardship Council—so we learn together and move faster. \

I know this can feel new or even disruptive. My belief is that all our programs thrive more when they’re connected by a simple, transparent accountability layer. I trust our stewardship and the Celo community to make this work—and I’m excited.

We haven’t gone to a vote yet; there’s time to tinker and clarify. I’d especially welcome input from @LuukDAO and @Wade, and from folks stewarding Regional DAO efforts.

**What does “cosmo-local credit” mean?

(I want to put these images right in here for some clarity.)**

Cosmo-local-liquidity-seeding1
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Cosmo-local-liquidity-seeding2
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Cosmo-local-liquidity-seeding3
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(above from Cosmo-Local Credit, From the Ground Up)

In summary: You issue a digital voucher (a gift card for your goods/services) and stake it in a community commitment pool. That voucher is your collateral. You can draw what you need now (e.g., cUSD or supplies) with zero interest. Your outstanding obligation equals the value of your vouchers held by the pool. You settle by either returning what you drew (to reclaim your voucher) or another member swaps in their own voucher of equal value, takes your voucher out, and spends it with you—so the claim moves from you to them. Because vouchers (claims) can pass person-to-person, credit keeps rotating—a recyclable, interest-free loop across locally stewarded pools on Celo.

In short:

  1. Self-mint gift cards (IOUs) for your products/services into a shared commitment pool. (With approval)

  2. Access goods, services, or cUSD now—without interest.

  3. To settle, return what you took or let another approved member swap in their gift card and take yours. (this swapping is the key toward a flowing credit network)

  4. They claim your goods/services; later, someone else can take their card.

  5. The IOUs move around the network until fulfilled—keeping value local and usage on Celo.

P.S. I believe this pilot will show amazing TVL and Celo on-boarding and daily usage … as I have seen this method work in Kenya.

With care and solidarity,

Will R.

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Interesting. Who determines the value of the voucher that each person contributes as capital?

Like, let’s say I’m a painter, and want to draw from the credit pool. I create a digital voucher for “one medium sized internal room painted” and add it to the pool? Or do you create a voucher for “$200 of work from Joe’s Painting” ?

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I love the direction this is going. It is explicitly inspired by Sarafu, right? One of the crucial features of Sarafu is that to function it requires community trust and community accountability. Otherwise a bad actor could stake commitments that aren’t actually worth anything, and game the system. It is not a “trustless network” – and that is a good thing! There is no positive future for humanity in which we trust each other less and less.

Without the rocket fuel of speculative investment, for something like this to get off the ground it needs buyin from existing local community networks. It sounds like you are building that. I will follow this project with interest.

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Charles! thank you. Yes, Sarafu.Network helped prove these ideas in practice, but the deeper lineage is much older than us. What we’re proposing is a modern accountability and interoperability wrapper around ancient, trust-based credit: rotating, interest-free lines repaid in-kind. You see this across Islamic finance (no riba, waqf-style endowments, community guarantees), indigenous reciprocity systems (Mweria, harambee, chamas/ROSCAs, stokvels, susu), and many forms of mutual aid. Sarafu.Network was built by Grassroots Economics Foundation having learned from those living systems; our Celo design draws from the same well.

So it isn’t “trustless” - and we agree that’s a feature, not a bug. The chain is just a public memory layer: it records who staked, who swapped, who fulfilled, and the limits/clawbacks the community set. Trust stays human; accountability becomes visible. Pool stewards, guarantors, and redemption windows do the social work; the contracts keep the bookkeeping simple and forkable.

On “rocket fuel”: we’re not chasing speculation. We’re grounding with existing community networks (schools, shops, farms, clinics) so the first liquidity serves real daily needs and recirculates. When someone stakes a voucher and draws cUSD, they “repay” by delivering what they promised, or a neighbor can take the claim and redeem later. That rotating, in-kind settlement is the salary-like flow we’ve seen work on Sarafu and in countless traditions.

Grateful you’re following. If you’re open, we’d love your reflections on how to narrate this as commons practice rather than a new product - so more people recognize the heritage underneath it.

With care,
Will

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In practice, each user would mint say a dollar-denominated (cUSD) vouchers for their services so that a pool had a common unit of account. So in your example, instead of one room, you’d create vouchers like “$200 worth of Joe’s Painting” with clear redemption notes e.g. one room, size may not exceed 15m2, standard prep materials included, 60 day expiry).

You propose the face value and pool stewards would sanity-check it against local rates and adjust your limits in the pool. One accepted into the pool, those vouchers are your collateral and you can draw up your approved line (typically a multiple, e.g. 3x, of what you staked) with 0 interest. This aligns with Islamic finance practice (no riba), collateralized commitments for real services and guarantors who vouch for you when the line is granted. If a voucher isn’t fulfilled, guarantors step in and your limits adjust keeping accountability clear while letting value circulate.

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I had a great chat with @Brisa from Celo Africa DAO at ETHsafari on how DAOs could use this model for accountability and linkages (TVL and transactions). Looking forward to feedback to to extend these concepts!

How CELO DAOs Plug Into the Cosmo-Local Credit System

(Example: Celo Africa DAO = CAD) I will in general use CD (Celo DAO)

1) The Commons: Celo Cosmo-Local Credit DAO (CCLCD)

  • A CCLCD multisig controls a Commitment Pool on Celo. (Similar to a static rate multi-token liquidity pool)

  • DAOs apply to this pool with an ERC-20 voucher token as collateral and a brief use-of-funds proposal (along with guarantors).

  • Credit is zero-interest and repayable in-kind (by fulfilling the DAO’s own vouchers) or by returning assets.

2) CD as an applicant (works the same for any CELO DAO)

Token: CD mints CT (Celo DAO Token) — an ERC-20 where 1 CT = 1 USD of CD goods/services (gift card).
Example Services covered: Celo Onboarding, Developer Support, Job Hunting, Project Incubation, Operations Support, DAO Training, University Onboarding, etc.

Proposal: CD states what funding is for and how they’ll fulfill CT (who gets what, where, and when).

Approval & Seeding: Upon CCLCD approval, CD stakes X CT into the pool (their endowment/collateral).

Then a credit line is approved by the CCLCD.

Credit line: CD may then swap up to Y CT into the pool to remove cUSD (or other approved pool assets).

Default policy: Y = 3 × X (i.e., credit line is 3× the seed).

Total exposure cap: Limit = X + Y = 4× seed (pool-level parameter; starts constrained by available liquidity).

Numbers at a glance

  • Seed: X = 10,000 CT (=$10,000 of CD services)

  • Borrowing capacity: Y = 30,000 CT → can be swapped in to remove $30,000 cUSD (or other approved assets)

  • Total CT limit visible to the pool: $40,000 CT (this is a rotating line of credit)

3) How CD repays (three paths)

Once CT has been swapped out of the CCLCD pool, any CT holder can swap back in to remove resources (rotating line of credit). CD’s debt decreases as CT is reclaimed or fulfilled.

  1. Stable-coin swap (“vending machine”) — preferred
    CD (or any participant) swaps stable coins into the pool to remove CT, then uses CT for CD services.

  2. Other vouchers (“debt swap”) — preferred
    Any approved DAO voucher can be swapped in to remove CT. The new holder spends CT on CD services; the claim (debt) moves.

  3. Certificates for completed actions (caution)
    CCLCD can allow certificate tokens that redeem for proof-of-work to remove CT.
    Note: heavy use of certificates reduces Financial TVL and can stagnate the pool; #1 and #2 are preferred.

Governance note: The CCLCD seeds the top-level pool with cUSD/other assets upon vote. Credit lines (loans) are distinct from endowments (seeding). Any token’s swappability can be enabled/disabled by CCLCD vote (as are all Pool functions).

TVL lens: We will measure “more value on Celo” by how much remains in pooled escrow and how actively it circulates (Financial + Economic TVL) with quarterly reviews.

4) Reporting & reviews

5) Cascading this: CD creates its own pool

CD should (as per their proposal) use its $30k cUSD to seed their own CD Pool for local teams/nodes:

  • Applicants (e.g., University Leads) mint their own ERC-20 vouchers (e.g., ULT) representing their services, submit a short application, seed their vouchers, and receive a zero-interest credit line.

  • They swap ULT into the CD pool to pull out cUSD and deliver services; the pool fills with ULT and other CD-affiliated vouchers.

  • The CD pool becomes a marketplace: people can swap cUSD in to pull vouchers for services, or holders swap vouchers among themselves.

  • CD may issue certificates sparingly to settle specific completed actions.

  • Monthly CD Pool Member reports tag their own vouchers; quarterly CD votes to adjust ULT ( or other voucher etc.) credit lines based on reports and on-chain fulfillment. (Same as CCLCD).

6) Why this fits CELO DAOs

  • Zero interest, real accountability: repay in-kind via your own services.

  • Rotating, recyclable liquidity: claims move voucher-to-voucher; lines refresh on fulfillment.

  • TVL that stays on Celo: escrow remains; value circulates through swaps/redemptions. Long-tail - everyone makes erc-20 tokens and credit lines extend across the whole network (increasing daily transactions beyond Visa and Mastercard).

  • Forkable & fair: the same pattern works for any CELO DAO by minting its own service voucher.

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Thanks @WillRuddick for this great proposal initiative. Our current proposal is focused on strengthening community coordination, onboarding, and developer support to drive adoption and measurable TVL on Celo. In practice, those same activities naturally produce the kinds of “voucherable” services (training, incubation, onboarding, project support) that your Cosmo-Local Credit model would recognize as collateral.

In other words, what we are building now lays the groundwork for that next step: tokenizing and recycling the value of our services into a sustainable credit system that keeps liquidity on-chain. We’re excited about this direction and look forward to collaborating on how to bridge our community impact activities into such a model as the ecosystem matures.

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The Long Tail & the Future of Celo

long-tail2
long-tail21135×634 33.6 KB

Celo’s superpower isn’t speculation - it’s publishing everyday agreements and routing trust at the speed of daily life. The “long tail” of tiny advances - gift cards, store credit, subscriptions, tabs, prepayment for services - is already how millions bridge groceries, school fees, inventory and care. When those promises are made legible on Celo through cosmo-local commitment pools (vouchers in, interest-free credit out, redeemed in-kind), the tail can add up to more daily activity than traditional card networks—because there are simply more people making more small, real transactions.

This is not new economics; it’s ancient trust made visible: interest-free, in-kind repayment, locally stewarded, globally interoperable. Every mint, swap, redemption, and tranche is on-chain by design - so value circulates, TVL persists, and communities retain more of what they create.

Read the full article here:
:right_arrow: https://grassecon.substack.com/p/the-future-of-celo

The long tail is right in front of us. We don’t need to invent generosity. We just need to give it rails.

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Hey all,

Love the direction of this proposal and the impact GE has created over the past years - however the metrics seem relatively low for the size of the ask.

  1. What happens with the liquididty buffer budget? Would that be returned to Celo Treasury after x time?

  2. How would reducing the budget ask influences your capacity to iterate on your tools / methods and have an impact? Could you start with 2-3 regions instead of 5 and reduce the ask proportionally?

  3. There are many upcoming Gitcoin Rounds that could cover part of this proposal, which I generally think is better than asking the Celo Treasury for a development grant. I can imagine having 1-2 Credit Network get started as part of the Local Funding program (10-25k per locality) and could see the development worked by covered by a 15-25k Solution Development Grants. You can read more about the Program in the Domain document here. Would it be an option to fund the next ~6 months of expansion through these rounds rather than with this proposal?

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  1. Yes, any unused buffer would be returned to the CCF. The seed funding would be used tranche by tranche (drawing down the approval slowly). Concretely: funds sit in top-level escrow; each regional tranche unlocks on KPIs. Any unused or under-utilized amount after the evaluation window is clawed back to the Celo Treasury (or reallocated by vote to higher-performing regions). Time-bound checkpoints + public reports keep this tight.
  1. We are iterating daily, and this proposal won’t stop that. But it can help accelerate it and help the entire Celo community gain accountability and connection beyond just us.
    Yes, we can start with 2-3 regions and reduce the ask proportionally. We’re already operating in more than a hundred locations. This isn’t for us as GE only; it’s to knit together Celo’s long tail with shared accountability. N.B. [We] as in Grassroots Economics Foundation, would be represented as a single signer on the DAO.
  1. This is not a development grant. The tools are here and in use.
    The reason we voted “no” on several grant programs is that we disagree with grants that have no accountability and don’t create a community – cosmo-local across Celo. The purpose of asking the Celo community directly here is to choose another path: zero-interest lines with in-kind repayment, tranche-gated and publicly reported, so value recycles instead of draining away.

That said, we’re happy to coordinate: Gitcoin/Local Funding could cover training/kits and local adoption events, while the Treasury seeds the neutral top-level liquidity buffer (escrow) so we maintain chain-wide accountability and durable TVL. If helpful, we can sketch a hybrid: Treasury seeds escrow; Gitcoin supports extras per region.

happy to comment on specific lines:

We’ve been working (patiently and persistently) to help the Celo community lean into this cosmo-local direction. It’s starting to click. This year, Prezenti funded a Kenyan university to provide zero-interest student lending using pools and vouchers for accountability and networking. It’s simple, human, and it works. The early impacts are genuinely beautiful. We’re grateful for the support so far, and excited to keep building this together (with clear guardrails, public memory, and a shared purpose that keeps value circulating on Celo).

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Let us model this approach by going first.

The DAO for this proposal (CCLCC Celo Cosmo-Local Credit Council) should as well follow the same logic proposed: issue an ERC-20 voucher to Celo Treasury, formalizing our commitments and redeemable for $300,000 cUSD and 30,000 CELO in Council-delivered products/services, e.g. onboarding kits, ToT seats, NFC/QR Code enablement, dashboard setup, KPI oracle attestations, audits, stewardship cycles, monthly reports, and advisory hours.

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