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How Gitcoin Unlocks Alternative Funding Avenues for NGOs: A Case Study, The Tor Project

Gitcoin’s partnership with The Tor Project goes beyond funding, fostering a vibrant community of privacy advocates and open-source enthusiasts. This collaboration showcases the power of decentralized, community-driven support to sustain and innovate critical privacy technologies. By leveraging Gitcoin Grants, Tor has gained not only financial backing but also a network of like-minded individuals dedicated to digital freedom and security, redefining traditional fundraising models and driving impactful change in internet privacy and decentralized governance.

“Gitcoin was really the starting point. We saw that the web3 funding world is both interested in privacy projects, open source software and really shares the decentralization and community values that we have. There is more than just funding. There is community support, new users, and the power to build together. It’s a great partnership.” 

Al Smith, Fundraising Director, The Tor Project

Beyond Funding: Building a Community of Privacy Advocates

“For us, the realization sunk in that Gitcoin isn’t just a cryptocurrency project. It’s a project about community fundraising and resourcing decentralized communities to do their work. This value alignment is how we ended up using the Gitcoin Grants and why we stuck with it. It’s so clearly in tune with how we at Tor envision community, and how I believe that we can change traditional fundraising models to be more flexible.” 

Al Smith

For the Tor Project, the relationship with Gitcoin extends beyond mere financial support. It includes a robust exchange of knowledge and thought leadership, critical for both organizations. Gitcoin’s decentralized governance model and community-centric approach have provided a blueprint for how nonprofits can leverage blockchain technology for broader societal impact.

Through Gitcoin the Tor team got introduced to Funding The Commons events that have connected Tor with other like-minded projects and individuals, fostering a community that values digital privacy and the open internet. This network is not just a source of funding but a platform for innovation and advocacy, allowing Tor to share its expertise and learn from others in the field.

A Bit of History

Let’s back up.

You might know the Tor Project as a safe browser—safe, because rather than profiting from your data, it protects it. Tor enables anonymous, secure communication, allowing users to access and share information freely. But it is much more than just a browser. It’s a critical tool for privacy and digital freedom.

The non-profit behind Tor was conceived in 2006 as a research initiative by two MIT students and computer scientists Roger Dingledine, and Nick Mathewson, to develop technologies that promote internet privacy and security. It was initially funded by a US government grant. 

Originally known as "The Onion Router," the project was developed to provide a secure means of communication, essential for activists, journalists, and individuals living under oppressive regimes. The technology uses onion routing, a method that anonymizes internet traffic by routing it through a series of volunteer-operated servers or "relays” and encrypting it every step of the way. 

From just 500,000 daily users in its early days, Tor now supports millions of users worldwide. The Tor browser, launched in 2008, has been instrumental during pivotal moments like the Arab Spring and the recent Mahsa Amini protests in Iran, helping citizens circumvent censorship and share their experiences with the world.

Navigating the Funding Landscape: The Role of Gitcoin

“With the onset of geopolitical events and very agile censorship strategies that are being used by state actors, Tor needed to improve access to more nimble funding and unrestricted funds. Gitcoin Grants play a big part in contributing to that pool.” 

- Pavel Zoneff, Director, Strategic Communications, The Tor Project

Operating as a non-profit, the Tor Project faces unique funding challenges. Unlike the traditional internet economy that profits from user data, Tor relies on grants and donations to fund its operations. However, traditional funding avenues can be slow and restrictive, often not aligning with the urgent needs that arise from global events and censorship tactics. This is where Gitcoin Grants has played a transformative role.

Gitcoin, known for supporting open-source and decentralized projects, introduced Tor to a new funding paradigm—one that is agile and community-driven. The partnership began in early 2021 when Scott Moore from Gitcoin reached out to help fund a Tor hackathon. This initial engagement opened doors to further collaborations, highlighting the shared values between the two organizations: a commitment to privacy, open-source development, and community empowerment.

Gitcoin Grants have provided Tor with a steady stream of flexible funding. This has been crucial for developing new technologies, such as the recently launched Webtunnel, a censorship-resistant tool designed to help users access the internet in heavily monitored regions. Unlike traditional grants, Gitcoin’s model allows for quicker disbursement of funds, enabling Tor to respond swiftly to new challenges, such as geopolitical upheavals or changes in censorship tactics.

“Individual donations are unrestricted funds, and a very important kind of support. Unrestricted funds allow us to respond to censorship events, develop our tools in a more agile way, and ensure we have reserves to keep Tor strong in case of emergencies.” 

- Al Smith 

[Source: https://blog.torproject.org/transparency-openness-and-our-2021-and-2022-financials/]

The Importance of Regular and Predictable Funding

“In traditional philanthropy, we’re submitting packets of information that are hundreds of pages long. Every application is designed and formatted in a different way, according to the institution. Gitcoin doesn’t do that. It’s much more of a simple process. It’s a better way to showcase user impact and to show people what unrestricted funding can do.”

Al Smith

A unique advantage of the Gitcoin partnership is the regularity and predictability of the funding rounds. Traditional funding can often be sporadic and time-consuming, with application processes that can take months, if not years. This delay is not just a bureaucratic inconvenience; it can be a critical hindrance in rapidly changing situations where immediate action is necessary.

With Gitcoin, the Tor Project can count on (almost) quarterly funding rounds, providing a reliable financial stream that helps the organization budget more effectively and respond to sudden changes in the geopolitical landscape. This has been particularly important recently, as Tor faces increasing challenges in anti-censorship work. The need to innovate and adapt quickly to changes in censorship technologies requires a funding model that is equally flexible and responsive.

Looking Ahead: Expanding the Impact of Decentralized Funding

"Tor was highlighted in a privacy and human rights specific round alongside organizations like Fight for the Future and EFF who are also doing work around privacy work online and protecting our right to privacy online. Being highlighted in that way showcased all of the projects, including Tor to the Gitcoin community. We were stunned by the amount that came from that round. It really taught us that the community in this space is interested in these ideas and understands them deeply and wants to support them."

Al Smith

The partnership with Gitcoin is not just about sustaining Tor’s current operations; it’s about expanding the impact of decentralized funding models to other non-profits and NGOs. There is a growing recognition of the need to support projects that operate outside the traditional funding frameworks, particularly those that address global issues like privacy, censorship, and digital rights.

Through its work with Gitcoin, Tor has also been introduced to other initiatives in the web3 space, such as Quadratic Funding projects like Octant. These collaborations highlight the potential for cross-pollination between different areas of digital innovation, all united by a common goal: to build a freer, more equitable internet.

“Before we started collaborating with Gitcoin, the support from the crypto community was more scatter shot. A lot of it was people making anonymous donations directly to our crypto wallets. So we didn’t have this community aspect within web3. Through Gitcoin, we’ve been able to build that community, and find out who some of these donors are who want to participate in the community. The participatory nature of grant rounds has made that possible.” 

Al Smith

Gitcoin has also enabled Tor to build on its diverse user base. Tor isn't just for those concerned with privacy from oppressive regimes; it supports a broad spectrum of users—from individuals looking up health information or accessing social media in censored regions, to those seeking reproductive healthcare. Interestingly, a significant number of Bitcoin nodes operate on Tor relays, leveraging the network's privacy features to enhance the anonymity of transactions. This integration highlights the cross-sectoral importance of Tor, not just as a tool for personal privacy but also as a critical infrastructure component for decentralized technologies.

[Source: https://bitnodes.io/dashboard/8y/]

Conclusion: A Partnership for the Future

“I have seen Gitcoin make a concerted effort to make participation easeful. The process of filling out the application and the UI has really improved and by opening up the Grants Stack to be something that anybody can run for their community as an open source decentralized software, I’ve seen that Gitcoin is not interested in being the intermediary.” 

Al Smith 

The collaboration between the Tor Project and Gitcoin exemplifies how decentralized technologies can support critical public goods like digital privacy. It showcases a model where community-driven funding and governance can sustain and enhance the work of nonprofits, even in the face of significant challenges.

For other nonprofits and NGOs, particularly those outside the crypto and web3, this partnership offers a compelling case study. It demonstrates that with the right tools and community support, organizations can not only survive but thrive in an increasingly complex digital world. Together, Tor and Gitcoin are paving the way for a new era of internet freedom and digital rights, ensuring that these fundamental values continue to flourish in the years to come.

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