DAOrayaki Reserach |District0x：A Decentralized Market Network

15 min readJul 7, 2021

DAOrayaki DAO Research Grant：

Fund Address: 0xCd7da526f5C943126fa9E6f63b7774fA89E88d71

Voting Result：DAO Committee Yes

Grant Amount：200 USD

Category:Platform, Payments, Reputation, BoostVC Portfolio, decentralized marketplaces and communities, district, d0xINFRA

Contributor：黑白 QB，DAOctor @Daorayaki

Launth time: February 2017

Token: district0x (DNT) ERC-20

Token price: $0.1296 (2021–6–30)

Market Cap: $77,730,361 (2021–6–30)

Circulating Supply: 600,000,000.00 DNT

Chinese Version:https://daorayaki.org/district0x-yi-ge-qu-zhong-xin-hua-de-shi-chang-wang-luo/

I District0x

The district0x project was founded in February 2017 with the goal of launching a network of decentralized marketplaces to eliminate rent-seeking, facilitate community governed economies, and to relinquish 3rd party data collection.

Mission

district0x aims to facilitate the operation and governing of marketplaces and communities as decentralized entities. district0x seeks to enable the recreation of many of the internet’s most popular applications and services while eliminating rent-seeking and the relinquishment of decisions and personal data to third-parties.

In recent months, five production studios have received contracts to build infrastructure and marketplaces that were outlined in the project roadmap. Most of the project’s branding and design work has been conducted by Griflan Design. Administrative support and community management has been provided by Sourcerers.io, a strategic advisory consulting service.

Consistent with its decentralized nature, district0x is continuing to work with a broader range of development teams. To assist in this, in the first half of 2019 we are opening up the bidding process for work to interested outside parties, accepting proposals from teams for tasks of all types, including not only development of future districts and modules, but also administrative, marketing, or community management tasks.

Features

Strengths

• Tackling an extremely large market — Uber and Airbnb alone have a combined valuation of $100B.

• Their current district, Ethlance, already has active users within the Ethereum community.

• The project has gained significant community support and cooperation from Aragon, Status, and others.

• district0x could become the standard way to create DAOs that require posting and listings, search and filtering, ranking and reputation, and payments and invoicing functionality.

Weaknesses

• The project is complex and requires a significant amount of community coordination to succeed.

• The strongest projects and teams may self-select to build their Dapps independently of the district0x network, especially if the cost and time savings of using district0x’s framework is not significant, resulting in lower than expected network

growth.

• Although the roadmap and use of funds are explained in detail the $50M hard cap still a bit steep.

What Makes District0x Unique?

District0x is built to tackle some of the inefficiencies that come with creating and operating distributed community marketplaces.

It does this by providing a wide range of smart contracts and front-end libraries that developers can use to easily launch their own districts, while providing a simple platform for community governance.

Unlike some other platforms which charge a fee for launching new applications, developers can create a district for free — though a refundable deposit will need to be paid to be added to the District Registry. This easy access platform has already given rise to a range of successful districts, each of which have varying forms and functions.

Some of the most popular districts include decentralized job market Ethlance, peer-to-peer ENS names marketplace Name Bazaar and Meme Factory — a district that provides a simple interface for the creation of rare digital assets.

District0x represents a speculative buying opportunity for investors willing to take a positive long term view on the idea of Ethereum-based marketplaces.

The existence of a functioning district on the network shows that initial network modules work and can easily be used by members of the Ethereum community. Significant community support for the project by major stakeholders in the Ethereum ecosystem gives credibility to the idea that developers could decide to build on top of the district0x infrastructure instead of starting from scratch.

While the $50M cap is higher than ideal, the distribution of excess funds to district proposals that are voted on by the community and reach quorum provides a mechanism to help ensure that funds are spent on projects that will add value to the district0x network.

Roadmap

Prior to potential Contribution Period v0.2

● Deploy d0xINFRA

● Migrate Ethlance to d0xINFRA

● Deploy Name Bazaar to district0x Network

● Deploy Meme Factory to district0x Network

● Deploy the District Registry

Prior to potential Contribution Period v0.3

● Enable district extendability via auxiliary modules

● Deploy auxiliary module directory

● Deploy 5 additional districts to district0x Network

● Deploy district0x Network Token staking interface

Following potential Contribution Period v0.3

● Deploy district creation interface

● Deploy district0x Network directory

● Complete handover of governance of the district0x Network to district0x Network Token holders

II Introduction

district0x Network

What is district0x?

The district0x network is a collective of decentralized marketplaces and communities known as ‘Districts’. Districts exist on top of a modular framework of Ethereum smart contracts and frontend libraries referred to as d0xINFRA.

What problem does district0x solve?

The district0x network solves a number of coordination issues and inefficiencies commonly found within distributed community marketplaces. This is accomplished by providing tools that can better align incentives and decision making among the market participants themselves. The end goal is to create a self sustaining ecosystem that can flourish without the need for a central authority.

What is d0xINFRA?

d0xINFRA is a standard open source framework comprised of Ethereum smart contracts and front-end libraries. With the development of Name Bazaar and Meme Factory, the district0x team is building the initial iteration of d0xINFRA, which will allow other development teams to launch their very own district.

How do you pronounce district0x?

District — Zero — X

Why the name district0x?

The name district0x is derived from two things. “Districts” are the marketplaces and communities that serve as building blocks of the network. “0x” is an homage to the Ethereum network as the first two symbols that make up all Ethereum addresses. The “0x” prefix is used throughout computer science as the beginning of hash values.

Where can I find a development roadmap?

Visit our blog for the most up to date information regarding our roadmap, and view our blog posts for announcements and development updates.

Districts

What are districts?

Districts are the decentralized community marketplaces that utilize the d0xINFRA framework. They are managed by a governance layer provided by the Aragon network, operating through Ethereum smart contracts and our standardized front-end libraries (d0xINFRA).

What will districts look like?

Districts will be able to look completely unique from one another. We primarily design libraries so they don’t dictate the visual side of things, but there will also be layers on top of that with pre-made, customizable components for optional use. We’ll be using those components in our districts. Currently we’ve chosen the Material Design style for these components, as can be seen on Ethlance. This may change over time if a better solution presents itself.

What will the first district on the district0x network be?

Ethlance is the first launched district, and was deployed to the Ethereum Mainnet on January 29, 2017. This was followed by Name Bazaar, deployed to the Ethereum Mainnet on October 24th, 2017. In the future, we will build and deploy Meme Factory. The fourth district to be built on the network is currently being decided by token holders on the district0x Voting dApp.

What kind of project could implement a district?

We envision virtually any type of communal marketplace being built as a district. If the project requires the ability to post listings, search/filter through listings, rank or give reputation to users, and/or allow for payments; then they should be a good fit for a district. A current list of district proposals can be found here.

Is there a fee to create a district or become part of the network?

No, there is no fee planned to create a district or join the network. However, joining the network will require a refundable deposit to the District Registry. This deposit may be challenged and forfeited in the event that the district is considered malicious or does not add value in the eyes of the network participants.

What are auxiliary modules?

An auxiliary module is a piece of software that can be added to a district that extends functionality or adds new features that the marketplace participants can utilize. Auxiliary modules are intended to facilitate the modular and extensible nature of the network, allowing each district and its participants to elect the functionality that district offers.

Governance

How does a project become part of the network?

The district0x token holders themselves decide whether a district is good or bad for the network through the District Registry, an incentivized voting game that dictates access to the network. Whether a district is good or bad not only applies in terms of the quality of the marketplace, but also prevents against districts that are deemed immoral or threatening to the entire network by DNT holders. This will be entirely up to the DNT token holders to decide.

How will district governance work?

When a marketplace is created on the district0x Network, a corresponding Aragon entity will be created, where all of the marketplace’s governance processes will occur. To facilitate open participation in these governance processes for all internet citizens, DNT allows holders to stake their tokens to a district in exchange for voting shares in its Aragon entity. Voting shares will be used to come to consensus on everything from a district’s code of conduct, to the ways in which they choose to monetize, to how any revenue generated is utilized or distributed.

What is the District Registry?

The District Registry is based on an incentivized voting game developed by the Token-Curated Registry team at Consensys. At its core, a Token-Curated Registry (TCR) allows for a community of token holders to curate a list for a number of different purposes. Those purposes could include anything from access to a “clean pool” of resources, a guest list, content curation, fraud prevention, among many other uses that increase the quality of anything entering a list. This is accomplished through a deposit, challenge, vote and reveal process. The specific purpose of the District Registry is to democratize many of the decision making and governance processes to DNT holders. You can learn more about TCRs here.

Can a district implement their own token?

Yes, there are scenarios where a district can create its own token to provide some additional utility outside of governance purposes. Many projects that have submitted a proposal in our Github have already created a token that provides market specific utility.

Who gets voting rights in a district?

The creator of the district has voting rights initially. As a result, they could set their bylaws so they retain complete control over the district. However, this would be disadvantageous for them if trying to develop a large and active district. But in some cases, it may be preferable.

Why should a project utilize d0xINFRA?

If a project implements the d0xINFRA framework, it will ensure compatibility with all future auxiliary modules on the marketplace layer as well as any apps/modules deployed to the Aragon governance layer. This modular standardization will ensure all marketplaces on the network can remain nimble, flexible to change and seamlessly co-operate in the most efficient way possible.

district0x Network Token (DNT)

What is the District Network Token?

The district0x Network Token is an Ethereum-based token built using the ERC20 standard. This token was created to facilitate participation and coordination in the development of the district0x Network, and eventually the handoff of network governance to the community.

What is the value proposition of DNT?

The district0x Network Token is a multi-utility token required for application to the District Registry, an incentivized voting game to dictate access to a suite of supplementary services exclusive to network members. It’s also used to signal support or disapproval for proposals made by network participants, and will be staked to deposit pools to mint tokens providing district-specific voting rights in corresponding Aragon entities. The inherent value to any given person will differ depending on the extent of their desire to participate in the network as well as the mechanisms outlined in our whitepaper.

How does the DNT staking mechanism work?

A refundable deposit of DNT can be deposited to a district’s corresponding Aragon entity. By doing so, an individual is granted voting rights in the form of tokens that can only be used within that specific Aragon entity. An individual can then use those tokens to propose and vote on anything ranging from a district’s branding and design decisions, to what functionality is added via auxiliary modules, to the appropriate settings for any adjustable parameters of these modules, to the means in which any revenue collected by a district is to be distributed, and beyond.

Will staking DNT to a district provide passive rewards similar to proof of stake?

Unlike “proof of stake” and other reward based staking schemes, DNT does not provide a direct reward when staking your DNT to a district. These types of incentive structures would be up to governance participants proposing and voting for changes within an individual district’s Aragon entity.

Why can’t spend DNT in a district?

We will never enforce the use of DNT for payments on the platform, we intend to allow for payment not only in ETH, but any other ERC20 by leveraging the 0x Protocol. For some background on the logic for this, refer to our blog post about the 0x integration.

district0x Network Fundraiser

What is the total supply of district0x Network Tokens?

A total of 1 billion tokens were minted by the district0x Genesis Contract. 600 million DNT were distributed to fundraiser participants during the initial contribution period which ended on August 1, 2017. 180 million DNT are held in reserve for possible future fundraisers. 198 million DNT are held by district0x founders, and are subject to a 2 year vesting schedule. The remaining 22 million DNT are reserved for advisors and the community rewards program.

Will there be a lockup period for tokens allocated to the founding team?

Tokens distributed to founders, early contributors, and advisors vest are subject to a vesting schedule. Founder and advisor tokens are allocated over a 24-month vesting period, with a 6-month cliff. Early contributor tokens are allocated over a 6-month vesting period, with a 3-month cliff.

Parameterization

All numeric parameters of the District Registry are flexible, and can themselves be voted on for change through the propose-and-challenge process described above. The district0x team will define the initial parameter values and will stake the initial deposits required for these parameters. The parameter set is as follows:

● Required Deposit — The number of district0x Network Tokens needed to submit an application to the Registry.

● Challenge Period Length — The amount of time (measured in blocks) that an application must remain idle for challenge before automatic inclusion in the Registry.

● Voting Period Length — The amount of time (measured in blocks) that a challenge will remain open for voting commits from token holders.

● Reveal Period Length — The amount of time (measured in blocks) during which committed votes can be revealed for a particular challenge.

● Required Vote Share Ratio — The ratio [0–1] of committed AND revealed tokens in a vote required to uphold an application’s place in the District Registry. A higher number implies a higher bar of acceptance to the Registry.

● Awarded Ratio — The ratio [0–1] of forfeited deposits in a challenge that gets rewarded to the winning depositor. A higher number is more rewarding for the depositor, a lower number is more rewarding for voters.

The district0x team will affix the initial parameter set to the following values:

● Required Deposit — 1,000 DNT

● Challenge Period Length — 24,200 blocks (about one week)

● Voting Period Length — 24,200 blocks

● Reveal Period Length — 7,000 blocks (about 48 hours)

● Required Vote Share Ratio — .5 (A simple majority decides to accept/reject applications)

● Awarded Ratio — .5 (A challenger needs 66.7% confidence in success to justify a challenge)

Token sales：

The district0x Genesis Contract will mint a total of 1,000,000,000 district0x Network Tokens (DNT). Thereafter, DNT will be minted in perpetuity exclusively via the district creation module.

The district creation process mints 1 DNT for every new district created on the network. Tokens minted by this mechanism may never be un-staked or transferred.

The DNT minted by the district0x Genesis Contract will be distributed across a series of up to three potential contribution periods. A total of 600,000,000 DNT will be divided and distributed across all participants. Within 14 days of the close of Contribution Period v0.1, participants will receive an allocation proportional to the amount they contribute out of the total amount contributed. The district0x Genesis Contract will allocate the remaining minted DNT as follows:

● 140,000,000 = Reserved for potential Contribution Period

v0.2

● 40,000,000 = Reserved for potential Contribution Period v0.3

● 200,000,000 = Distributed to Founders

● 15,000,000 = Distributed to Advisors

● 5,000,000 = Distributed to Early Contributors

Distribution of these funds depends on the total amount raised.

There are three main scenarios for how funds will be distributed across development, operations, legal, and a district0x fund as shown below. The goal of the district0x fund is to accelerate the growth of the network by funding “new projects on the district0x Network and the creation of new auxiliary modules that enhance the functionality and utility of the district0x Project.”

It’s worth noting that founders, advisors, and early contributors receive just over a third of the initial DNT distribution, which is quite substantial. However, these funds are subject to distinct vesting schedules. Founder and advisor tokens are allocated over a 24-month vesting period, with a 6-month cliff. Early contributor tokens are allocated over a 6-month vesting period, with a 3-month cliff.

Commercial Strategy & Roadmap

The success of district0x relies on network effects and the success of individual districts on the platform. In order to use districts users must purchase and stake (put into escrow) DNT.

By staking their DNT users become shareholders of the district and receive voting shares in the district’s Aragon entity (a platform for creating Decentralized Autonomous Organizations).

This entity is used to determine everything about the district, from what it actually does to how it distributes profits. Because DNT is a token for the entire network, it is not necessary for token holders to participate in profitable districts to benefit from their success. The value of any holder’s DNT will still increase as long as the total use of the network increases. This is still a bit of an assumption, as it is entirely speculative as to whether projects will use the network. In fact there is a risk that the strongest projects and teams may self-select to build their Dapps independently of the district0x network. So far the only district running on the platform is Ethlance, a decentralized freelance job market, which has been active on the Ethereum network since January 2017. ENS Bazaar and Meme Factory (inspired by Simon de la Rouviere of ConsenSys) are scheduled to be the second and third districts, respectively.

III Team：

Joe Urgo, Co-Founder, Operations

Founder/CEO at Sourcerers.io. Previously Joe worked as an Operations Manager at Coinbase, a Derivatives Trader at Three Arrows Capital, and a Professional Poker Player.

Matus Lestan, Co-Founder, Lead Developer

Lifelong developer with a strong passion for decentralization. Previously a freelance developer for 8 years, Matus is now known for pushing the Clojure-Ethereum ecosystem forward via many open source contributions.

Alexander Khoriaty, Project Manager

Founder/COO at Sourcerers.io. After studying physics and philosophy at the University of Michigan, Alexander spent 2 years working at Coinbase building out Quality Assurance program and triage processes.

In addition, project consultants include Luis Cuende (co-founder of Aragon), Carl Bennett (co-founder of Status), Brayton Williams (co-founder of Boost VC), Zhou Shuoji (founder of FBG Capital), Manmeet Singh (Blockseed Co-founder of Capital) etc.

IV Contact Informatica：

Official website: https://district0x.io/

Whitepaper: https://district0x.io/docs/district0x-whitepaper-cn.pdf

Blog: https://blog.district0x.io/

Twitter: https://twitter.com/district0x

Reddit: https://www.reddit.com/r/district0x/

Telegram: https://t.me/district0x

Discord: https://discord.com/invite/sS2AWYm

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