Understanding the PoLN Protocol: Basics and Beyond
PoLN is a DAO leveraging blockchain to revolutionize the labor market, ensuring transparent, efficient, and global project execution with enhanced security and fairness.
This whitepaper introduces PoLN, the next evolution in decentralization, focused on disrupting the labor market by leveraging blockchain technology.
Historical Context and Market Evolution
The Rise of Decentralization
Amazon (2000s): Started as an online bookstore and evolved into a trillion-dollar logistics and technology company, without owning most of its inventory.
Airbnb (2008): Democratized the rental space, allowing individuals to rent out their properties. It has grown into a $6 billion annual revenue company, facilitating over 500 million stays globally.
Uber (2009): Disrupted the taxi business by connecting riders with drivers via an app, now valued at over $70 billion.
Bitcoin (2009): Introduced the first decentralized digital currency, leading to a $2.4 trillion blockchain industry.
Ethereum: Advanced smart contracts, leading to the development of multiple layer one and layer two blockchain solutions.
The Changing Freelance Market
The number of freelancers in the United States has been steadily increasing, with projections indicating that there will be 90.1 million freelancers by 2028. While globally this number is already exceeding 1.5 billion at the time of this writing (2024).
This trend reflects a global shift towards self-employment and the rise of the gig economy.
New generations prioritize flexibility and autonomy in their work, driving the demand for decentralized platforms like PoLN.
As the workforce becomes increasingly freelance-based, the need for decentralized, transparent, and efficient project management solutions becomes more critical than ever.
The PoLN Initiative
Concept and Vision
PoLN aims to democratize and decentralize the labor market by offering a fully decentralized autonomous organization (DAO), unlike platforms like Airbnb and Uber that focus only on democratization.
The protocol addresses several key global challenges:
Sustainability: Tackling the reliance on fossil fuels and labor exploitation.
Wealth Redistribution: Reducing growing global wealth inequality.
Adapting to New Expectations: Catering to younger generations’ desire for autonomy, flexibility, and meaningful work.
Future of Work: Supporting the shift toward self-employment through transparency and efficiency.
Similarities to Major Disruptors
Amazon: Like Amazon decentralized retail, PoLN decentralizes project management by providing a platform for global participation.
Airbnb: Similar to how Airbnb democratized hospitality, PoLN democratizes labor, allowing anyone with the skills to participate in projects worldwide.
Uber: Just as Uber removed intermediaries between riders and drivers, PoLN removes middlemen between project owners and executors.
Key Roles in PoLN
PoLN introduces reshuffled roles and new concepts essential for a decentralized project execution environment:
Initiators: Project initiators who propose and fund projects, outline project requirements, and ensure the project's overall direction.
Agents: Skilled networkers who help in business development, recruitment, and networking. They bring together the required team for project execution. Agents also help with sales and networking, leveraging their extensive connections.
Mentors: Experienced professionals who assist project initiators in creating comprehensive RFPs. They have over a decade of experience and can act as trusted advisors.
Contractors: These include software engineers, scrum masters, project managers, and other professionals involved in the day-to-day execution of projects. Contractors work globally, ensuring that projects are delivered with high quality and within the set timelines.
Reshuffled Roles and New Concepts
PoLN introduces new concepts to improve project execution efficiency:
Fellowship Program: A cornerstone of the PoLN protocol, fostering a sense of community and collaboration among participants.
Gamification and Reward System: Encourages participants to deliver projects on time and with high quality.
Staking Mechanism: Both project initiators and participants must stake PoLN tokens to ensure commitment and reduce the likelihood of disputes.
Decentralized Dispute Resolution: Neutral community members judge disputes, ensuring fair and unbiased resolutions.
Benefits of PoLN
Eliminating Barriers
PoLN allows project owners to bypass the need for local or national teams, providing a transparent and decentralized system for global project execution.
For example, the combined fee for both a tenant and a landlord on Airbnb can go as high as 20%, whereas PoLN aims to minimize such costs to minimum through decentralization.
Reducing Friction
By eliminating intermediaries, PoLN reduces financial and communication barriers between project owners and executors, similar to how Uber simplified ride-sharing. This reduction in friction leads to lower costs and faster project execution.
Increasing Efficiency
Global participation enables efficient bidding and project execution, allowing project owners to focus on business growth.
Like Amazon's global logistics network, PoLN leverages a global talent pool for project delivery. Project owners benefit from a competitive environment where the best skills are matched to their needs, ensuring high-quality and timely project completion.
Fair Wealth Distribution
PoLN offers equal opportunities to participants worldwide, ensuring that skill and ability are the primary criteria for project involvement. This approach is akin to how Airbnb allows anyone with a property to become a host, regardless of location.
Through PoLN, participants from both developed and developing countries can compete on a level playing field, promoting fair wealth distribution.
Challenges and Solutions
Dispute Resolution
PoLN employs a gamification and reward system to encourage timely and quality project delivery. Key mechanisms include:
Staking Requirements: Both project initiators and participants must stake PoLN tokens to ensure commitment.
Stable Currency Locking: Project initiators lock the necessary funds in a stable currency to guarantee mission participants' payments.
Penalties for Non-Compliance: Participants who fail to deliver face penalties, including the slashing of staked tokens.
Neutral Community Judgement: In case of disputes, neutral community members can be engaged to judge the matter.
Ensuring Quality, Timely Delivery, and High-Quality Contributions
To ensure high-quality and timely project completion, PoLN integrates several mechanisms that also motivate participants to contribute their best efforts. These mechanisms include:
Staking Requirements: Both project initiators and participants must stake PoLN tokens to ensure commitment, aligning interests and enhancing trust among all parties involved.
Reputation System: Participants build their reputation through successful project completions, incentivizing them to maintain high standards and deliver quality work on time.
Continuous Feedback: Regular feedback loops between initiators and contractors ensure any issues are promptly addressed, enhancing overall project quality and allowing for timely adjustments.
Incentives and Rewards: Successful project completion rewards and incentives are distributed in PoLN tokens, recognizing valuable contributions and motivating participants to maintain high-quality standards.
Fostering Platform Adoption Through Community Engagement: As more projects are completed and high-quality contributions are made, the utility and attractiveness of the PoLN protocol increase. This drives greater interest and adoption, strengthening the overall success of the PoLN ecosystem, which is powered by the community's sustained efforts and the growing usage of the platform.
Managing Volatility in Crypto Payments
PoLN uses stablecoins like USDT or USDC for project funding and payments to mitigate cryptocurrency volatility. This ensures financial stability and predictability, crucial for project planning and execution.
Stablecoin Usage: Participants are not adversely affected by market fluctuations, as payments remain consistent throughout the project's lifecycle.
Smart Contract Escrows: Funds are locked in smart contract-based escrows, which release payments incrementally based on achieved milestones, enhancing financial security and trust within the ecosystem.
Security and Trust
To build trust and ensure the security of transactions and data, PoLN employs advanced cryptographic techniques and smart contracts:
Smart Contracts: Automate project agreements, ensuring terms are met before payments are released. This reduces the need for intermediaries, minimizing the risk of errors or fraud, and ensuring transparent and verifiable transactions.
Data Encryption: Protects sensitive project information from unauthorized access, ensuring that all data exchanged within the PoLN ecosystem is secure.
By integrating the use of stablecoins for payments with the incentivization and governance roles of the PoLN token, PoLN builds a robust economic model that aligns community contributions with platform adoption and growth. This structure, supported by advanced cryptographic techniques and smart contracts, ensures that all transactions are secure, transparent, and trustworthy, creating a stable and reliable ecosystem for all participants
PoLN in Action
Scenario
A marketing agency frequently receives requests to build websites and mobile apps for startup clients. While they have an in-house development team, they keep the team size minimal to avoid paying salaries during idle periods. This often leads to work overload, forcing the agency to either reject new clients, outsource to unknown third parties, or ask clients to wait several months for relatively standard projects to be completed.
Step 1: Project Initiation and RFP Creation
Project Initiator: The marketing agency or any entity looking to initiate a project.
Action: The project initiator must first create a comprehensive Request for Proposal (RFP). The RFP is a prerequisite and should detail the mission, expectations, requirements, timelines, invoicing frequencies, milestones, roles needed (e.g., Software Architect, Backend Developer, Frontend Developer, UI/UX Designer, Database Administrator), and expected staking conditions.
RFP Support:
Scenario 1: If the initiator is experienced and confident, they can create and submit the RFP independently.
Scenario 2: If the initiator lacks expertise or time, they can seek assistance from the PoLN community. Experienced Mentors and/or Agents—professionals with over a decade of experience—can help craft the RFP. This collaborative process helps the initiator clearly define the project’s scope and requirements.
Step 2: RFP Submission and Bid Management
RFP Submission: Once the RFP is completed, the project initiator submits it on the protocol. This submission starts the bid management process.
Fellowship Bids: Fellowships then have the opportunity to bid on the project by submitting detailed proposals. These proposals should include deliverables, costs, milestones, payment conditions, and the amount they are willing to stake.
Selection Process: The project initiator reviews the bids and selects the Fellowship that best meets the project's needs.
Community Dynamics: Throughout the bid management process, transparency is maintained as all bids and proposals are visible within the protocol. Fellowships with a track record of successful missions are promoted, which encourages high standards and accountability within the community.
Step 3: Mission Creation and Funding
Mission Creation: After selecting a Fellowship, the project initiator creates the mission on the protocol.
Funding the Mission: At this point, the project initiator locks the necessary funds in escrow. The funds include stablecoins to pay the contractors and $POLN to cover protocol fees.
Staking by Fellowship Members: Fellowship members must stake $POLN as a commitment to the project's successful completion. Staking is calculated based on the role, project size, complexity, and perceived risk. The amount each participant stakes may vary, with higher responsibility roles staking more.
Accountability and Self-Regulation: This step enforces accountability among Fellowship members, as they have financial skin in the game. By staking $POLN, participants are incentivized to deliver quality work and avoid project failures, which would result in the loss of their stake.
Step 4: Project Execution
Team Work: The selected Fellowship's team begins work on the project as outlined in the RFP.
Mission Start: Before the mission officially starts, it can be aborted if there are misunderstandings or last-minute changes. However, once the mission is flagged as started, it cannot be canceled unless a failure is declared, following a structured resolution process.
Mid-Mission Dispute Resolution:
Dispute Detection and Notification: If a dispute arises during the mission, the project is temporarily suspended, and a formal dispute notification is issued.
Mediation: A Community Mediator is assigned to facilitate resolution, with all parties submitting evidence and discussing potential solutions.
Arbitration: If mediation fails, the dispute may be escalated to a panel of Arbitrators for a binding decision.
Resolution Impact: The mission either resumes with modifications, or it is terminated with appropriate fund distribution and staking adjustments. The resolution process is transparent, and the reputations of the involved parties are updated accordingly.
Step 5: Payment and Delivery
Invoicing: Fellowship members can request payments according to the invoicing period established during mission creation. This ensures continuous compensation for completed and satisfactory work.
Transparency in Delivery: The progress of the project and invoicing can be monitored by the initiator and community, ensuring that all participants are held accountable for their contributions.
Step 6: Completion and Rewards
Scenario 1: Successful Completion
Payment Distribution: Upon successful completion, the final payment is released, covering stablecoin payments for the work done and $POLN bonuses for the successful delivery.
Fee Distribution: Protocol fees are distributed equally among Fellowship members.
Staking Return: Fellowship members receive their $POLN staking back, and the initiator may receive a reward (a form of fee refund) based on the mission's success.
Promotion of Success: Successful Fellowships are promoted within the PoLN protocol, encouraging high standards and deterring future malicious behavior. This success builds the reputation of both the Fellowship (and its members) as well as the project initiator, making them more attractive in future projects.
Scenario 2: Failure
Outcome: If the mission fails and all parties agree, the mission is terminated.
Consequences: Protocol fees are redirected to the community/DAO wallet, and the Fellowship's $POLN staking is burnt. The initiator does not receive their reward, and the remaining funds can be withdrawn as the contractors will not complete the mission.
Flagging Failures: Failed missions are flagged within the protocol, ensuring that future initiators and Fellowships are aware of past performance. This discourages poor performance and helps maintain the integrity of the community.
Scenario 3: Dispute Resolution
Dispute Handling: If a dispute arises, an external party from the community intervenes to judge the situation. If the dispute is resolved in favor of the initiator, the mission is treated as a failure (Scenario 2). If resolved in favor of the Fellowship, the mission is considered a success (Scenario 1).
Community-Driven Resolution: Disputes are resolved transparently, with the community playing a key role in determining outcomes. This ensures fairness and maintains trust in the PoLN protocol.
Funding and Token Usage
In order to achieve our objectives, we are going to do our best to reduce speculation about the project and its token and shift focus to the protocol and its usage.
The best way to do that is to raise the early stage funding from future users of the protocol, this includes project initiators like big marketing agencies and project executors like software development houses. Both sides will use the token in order to pay for the protocol fees and stake instead of speculating about the price movement.
Once we go live and the protocol becomes fully functional the token will be sold to the public in order to participate in the usage of the protocol.
Final Thoughts
PoLN stands apart from platforms like Upwork and recruitment agencies by delivering entire projects with high quality, on time, and within budget on a fully transparent and tamper-resistant blockchain protocol.
Unlike simple task hiring platforms or recruitment agencies, PoLN focuses on complete project execution, promising to revolutionize the labor market globally.
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