ADA Litepaper

1. Introduction

ADA (Allo Domain Allocations) is a framework designed to streamline the distribution, governance, and accountability of dedicated funds toward well-defined goals. It incorporates:

• Dedicated Domain Allocation to ensure each pool of funds is exclusively used for a specific objective.
• Expert Governance using a Safe multisignature (multisig) model for transparent decision-making.
• AI-Assisted Screening to efficiently filter and improve applications both before and after expert review.
• KYC & Compliance Attestations to simplify regulatory and tax verification through reusable, auditable, on-chain attestations — ensuring eligibility while reducing administrative burden.

This litepaper describes the rationale, architecture, and workflow of ADA, illustrating how domain-specific funding pools can be managed to achieve measurable outcomes across ecosystems - from public goods and economic development to sustainability and social impact.

2. Background

2.1 Dedicated Domain Allocation

This funding structure earmarks capital for a defined sector, problem space, or initiative. It enhances accountability and predictability by ensuring resources are directed toward their stated purpose, minimizing competition with unrelated priorities.

2.2 Expert Governance & Safe Multisig

ADA leverages Safe Smart Accounts (commonly known as Gnosis Safes) to enable secure, collective governance of funds. Each Allocation Pool is managed by a panel of domain experts, with funding approvals requiring a multisignature quorum. This eliminates single points of failure, reduces bias, and produced fully auditable, on-chain record of every decision.

2.3 AI-Assisted Screening

Grant programs typically receive more applications than expert reviewers can meaningfully process. ADA integrates AI models to pre- and post-screen submissions, flag low-quality or misaligned applications early, and offer revision suggestions to applicants. This helps domain experts focus on high-potential applications, reducing administrative overhead.

2.4 KYC & Compliance Attestations

Managing Know Your Customer (KYC) and tax compliance processes is one of the most resource-intensive and legally sensitive responsibilities of on-chain grantmaking. ADA introduces a reusable, on-chain attestation model to address this challenge:

• One-Time Identity Verification: Applicants undergo a one-time KYC and tax compliance process via an approved verification partner.
• On-Chain Attestation: A cryptographically signed attestation is issued and linked to the applicant’s payout address.
• Cross-Pool Eligibility: This attestation can be referenced across multiple Allocation Pools, eliminating redundant verification for recurring applicants.
• Donor Compliance Assurance: By enforcing eligibility via verified attestations, donors can satisfy regulatory obligations without managing individual grantee compliance.

3. Problem Statement

Many funding programs face challenges such as:

1. Diffuse Accountability: Funds are often allocated without clear boundaries or transparency, complicating audits and impact measurements and making it difficult to ensure money is spent on its intended purpose. ^[1][2]
2. Excessive Workload: Experts are tasked with evaluating large volumes of applications, often with limited time and resources.^[3]
3. Opaque Decision-Making: Traditional funding decisions may lack visibility, leading to questions about bias or inconsistency.^[4][5]
4. Difficulty Measuring Impact: Even after funds are disbursed, there may be no straightforward way to track whether projects meet their stated objectives. ^[6][7][8]

ADA addresses these challenges by introducing an integrated approach:

• Domain-specific funding pools with explicit objectives.
• AI-assisted screening for efficient and consistent evaluation.
• Expert-led approvals via a Safe multisig.
• On-chain records to ensure transparency and traceability.

4. Proposed Solution: ADA

4.1 System Overview

ADA is built around Allocation Pools. Each pool:

• Defines a clear objective (e.g., "Clean Air", "Rural Connectivity", "Economic Development", "Open Science" etc.).
• Has a maximum token limit, preventing over-funding.
• Is governed by a panel of domain experts who review funding requests.
• Logs every decision, vote, and transaction on the blockchain for public verifiability.

4.2 Systen Flow

Figure 1: High-Level Flow

1. Funding enters the system from various sources (treasuries, organizations, individual donors).
2. Allocation Pools hold these funds, each with its own governance rules and objectives.
3. Funds can be distributed to Bounties (targeted tasks) or Applications (larger project proposals).

4.3 Project Application Lifecycle

Figure 2: Application Lifecycle

• Project Submits Application: Proposal outlines scope, budget, and intended outcomes.
• AI Pre-Screening: Initial check for completeness and alignment; applicants revise if needed.
• AI Post-Screening: Final AI scoring and summary of strengths/weaknesses.
• Expert Review & Vote: Domain experts examine the refined proposal and AI insights; vote to approve or reject.
• Funding & Impact Attestation: Approved projects receive funds; eventual results feed into Impact Attestations for long-term tracking.

References

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1. https://www.gao.gov/blog/communities-rely-federal-grants-may-have-challenges-accessing-them ↩︎

2. https://www.netsuite.com/portal/resource/articles/crm/grant-management-challenges.shtml ↩︎

3. https://igxsolutions.com/resources/blog/top-challenges-in-grant-management/ ↩︎

4. https://www.gao.gov/blog/communities-rely-federal-grants-may-have-challenges-accessing-them ↩︎

5. https://www.decisionlens.com/blog/implementing-transparent-funding-processes-for-science-technology ↩︎

6. https://ssir.org/articles/entry/prioritizing_impact_measurement_in_the_funding_of_social_innovation ↩︎

7. https://goodgrants.com/resources/articles/what-is-social-impact-and-how-can-you-measure-it/ ↩︎

8. https://www.resonanceglobal.com/blog/measuring-social-impact-approaches-challenges-and-best-practices ↩︎