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Direct to Contract Incentives

Direct to Contract Incentives

TL;DR:

In this model, capital flows to smart contracts, not humans. If a contract provides value (e.g. facilitates transactions, creates matches, processes attestations), it can earn funding automatically—based on usage, performance, or programmable logic.


This shifts the frame from:

  • “Who should we fund?” → “What code created the value?”


Direct-to-Contract Incentives allow for:

  • Automated retroactive rewards for public goods
  • Composable protocol-level funding (modules, oracles, relayers, etc.)
  • Decentralized, incentive-aligned infrastructure (e.g. privacy, identity, governance)


These incentives are ideal for:

  • Infrastructure that underpins multiple systems
  • Services where the interface is programmable
  • Situations where attribution is easier at the contract level than the contributor level


Examples include:

  • Matching contracts in Quadratic Funding rounds
  • Credential issuers in identity systems
  • Oracle relayers, zero-knowledge proof generators, or gas fee routers

Best For

  • Infrastructure and protocol services
  • Rewarding code-based public goods
  • Reducing human gatekeeping in funding
  • Scenarios where value = verifiable contract performance

Good At

  1. Automating value-based funding
  2. Reducing reliance on subjective judgment
  3. Supporting infrastructure with repeatable utility
  4. Composing incentives across ecosystems (multi-protocol rewards)

Dependencies / Requirements

  • Contract instrumentation (usage tracking, calls, etc.)
  • A treasury or funding pool with allocation logic
  • Performance or contribution metrics (gas used, volume, unique users)
  • Optional: governance layer for parameter tuning

Not Good At

  • Recognizing offchain or relational labor
  • Early-stage work with no onchain activity yet
  • Complex qualitative impact
  • Contexts requiring high discretion or cultural nuance

Who Should Use It?

  • Protocols coordinating across composable modules
  • Public goods ecosystems focused on technical infrastructure
  • Builders of relayers, identity tools, matching systems, or middleware
  • Funding systems experimenting with objective, usage-based rewards

Example Use Cases

  • A DAO routes 1% of its matching pool budget to the most-used matching contract each month
  • An identity protocol rewards verified credential issuers (contracts) for each successful attestation
  • A ZK tooling network streams funding to proof generators based on call volume and integration impact