The basics of Capitol Allocation

Capitol Allocation at a base level is simply the act of moving around funds, rescources, or assets between two or more individuals or entities. However things get more complicated with crowdfunding and grant systems because of things like gaming attacks. Coming up with new, game resistant, more democratic, scalable, and precise forms of capitol allocation is a very new field.

I have made this zpage and will be making more because I believe that Kevin Owocki in his book The Onchain Capitol Allocation Handbook has made some fantastic innovations that we can further grow upon, let's begin.

Legacy Capitol Allocation(LCA) vs. Onchain Capitol Allocation(OCA)

LCA

Legacy Capitol Allocation is probably the worst kind of Capital Allocation for crowdfunding because it does not use the advantages of the internet, is not scalable and is inprecise not to mention that the funds are usually gatekeeped not allocated democratically to the extent possible with OCA.

Government Spending

As Kevin Owocki touches on in the book, Government Spending is a prime example of LCA as the funds are highly gatekeeped, and it is not precise, not to mention the accumulation through taxes and the unmatched potential to circumvent the will of those taxed. Of all of the examples of the flaws of LCA Owocki talks about, the example of government spending seems to suport his point most effectively.

OCA

OCA is much more precise and scalable because of its programmable smart contracts and viewing keys. It can also be used to create much more democratic systems for allocating capitol than LCA. The OCA Handbook is widely tilted toward ethereum, however I will do my best to show how each OCA mechanism impacts privacy and how each helps mitigate certain gaming attacks further in this series.