Review of Gitcoin Quadratic Funding Round 3
In conventional QF, if two individuals each donate $10, the subsidy would be $10. Similarly, if two individuals each donate $10,000, the subsidy would be $10,000. This characteristic makes conventional QF vulnerable to collusion. Two main employees of a project (or two fake accounts owned by the same person) can donate just enough money to receive a significant subsidy in return.
Pairwise Bounded 2nd Funding, on the other hand, calculates the total amount of subsidies for a project by examining all pairs of contributors and imposes a maximum limit on the total amount of subsidies that any pair of participants can generate (across all projects). Additionally, Pairwise Bounded 2nd Funding also has the characteristic of penalizing projects that are dominated by large contributors.
This new design aims to address the weaknesses of conventional QF and promote fair distribution of subsidies in the Gitcoin Quadratic Funding Round 3.