Sage D. Young Sage D. Young is a tech protocol reporter at CoinDesk. He owns a few NFTs, gold and silver, as well as BTC, ETH, LINK, AAVE, PEOPLE, DOGE, OS, and HTR. Follow @ httpsageyd on Twitter Community members of Gitcoin , an organization set up to fund open-source software and other “ digital public goods ” such as blockchain code, voted to seed initial liquidity for its Staked ETH Index (gtcETH). The vote comes amid growing interest in liquid staking as the Ethereum blockchain moves toward the much-heralded “Shanghai” hard fork that will allow investors to withdraw staked ether for the first time. One benefit for Gitcoin could be that if there were adoption of gtcETH, the new effort could raise fees that could help to fund the organization’s grants program. On Friday, Gitcoin community members passed a governance proposal with almost unanimous support to formalize a relationship with the index provider Index Cooperative, and transfer 100 ether (ETH) worth $164,600 into two liquidity pools meant to “ensure deeper liquidity and reduce swapping fees for moving into gtcETH,” according to a snapshot . The creators claim the Gitcoin Staked ETH Index is the first on-chain offering where holders can simultaneously support funding of digital public goods and earn rewards from a diverse set of liquid staking tokens. GtcETH, built on Index Coop’s EVM-based protocol that enables asset-management strategies, is composed of three tokens from top liquid staking protocols on Ethereum: Lido, Rocket Pool and StakeWise. These three liquid staking protocols were chosen based on several factors including having a minimum of $25 million secondary market liquidity on Ethereum’s mainnet and being open source. Gitcoin’s gtcETH vote comes as the project moves toward exclusively running the grants program on “Grant Stacks” – described on its website as the “first-ever decentralized, customizable, smart contract-enabled solution that connects grants program managers, project owners and community members. ” The decision was announced in January. The system will rely on Allo Protocol . One of the motivations behind gtcETH stems from the unpredictability related to raising funds for digital public goods – think digital infrastructure, like open-source code, a blockchain or an open data set that could be consumed by everybody. Without a clear profit motive, the funding is sometimes hard to come by. According to the governance forum discussion on funding gtcETH , GtcETH could provide Gitcoin a consistent revenue stream to help fund grants. Here's how that's supposed to work: Token holders of gtcETH incur an annualized streaming fee of 2%, where 1. 75% is allocated to the Gitcoin decentralized autonomous organization (DAO) and the remaining amount to Index Coop. If gtcETH had a total value locked (TVL) of $1 million, gtcETH would contribute roughly $17,500 a year to Gitcoin Grants, placing the index in the top ten in Gitcoin’s Funders Leaderboard, according to Index Coop’s snapshot vote to launch gtcETH . GTC is Gitcoin’s native token that governs both Gitcoin Grants and GitcoinDAO. Despite Gitcoin support documents indicating that the governance token has “no economic value,” GTC has a market capitalization of $125 million. DISCLOSURE Please note that our privacy policy , terms of use , cookies , and do not sell my personal information has been updated . The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies . CoinDesk is an independent operating subsidiary of Digital Currency Group , which invests in cryptocurrencies and blockchain startups . As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights , which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG . Sage D. Young Sage D. Young is a tech protocol reporter at CoinDesk. He owns a few NFTs, gold and silver, as well as BTC, ETH, LINK, AAVE, PEOPLE, DOGE, OS, and HTR. Follow @ httpsageyd on Twitter Learn more about Consensus 2023 , CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus. coindesk. com to register and buy your pass now. Sage D. Young Sage D. Young is a tech protocol reporter at CoinDesk. He owns a few NFTs, gold and silver, as well as BTC, ETH, LINK, AAVE, PEOPLE, DOGE, OS, and HTR. Follow @ httpsageyd on Twitter.