Citizen Token System

Civic education (CE) is a part of secondary education in Ukraine. CE includes 11 training programs the Ukrainian Ministry of Education recommended for secondary schools. At the same time, we found several similarities between Ukrainian realities with MIT's Challenge Overview. In particular, the aims and strategies of civic curricula often exclude important components like critical thinking and participatory, hands-on learning (examples from Malawi, Pakistan, and the United States). A lack of opportunities to learn and practice civic skills is a specific problem that can be solved with our solution. This problem affects over 100 thousand minor children and several million adults in Ukraine who lack civic skills within local self-governing.

At the same time, Ukraine meets with challenges, which require collective actions to counter military aggression as well as to recover local communities. Previous research highlighted some barriers to this way to address. During the national conference "Design for change" (14-15.09.21, Kyiv), PACT/USAID highlighted essential findings in their public report. In particular, just growing public awareness does not increase activism; a clear link between expected changes and the practical needs of citizens, including economic growth, needs to be demonstrated to motivate their engagement and effectively promote reforms. So, improving civic action learning requires better people's motivation to learn. 

Foundation "Moloda gromada" considered these findings as a demand for innovative solutions for citizens' motivation to learn, which should help them to bridge new knowledge with concrete advantages in the short term. Our foundation supported the development of the Citizen Token System (CTS) designed within the initiative "Smart Interactions" aimed at better cross-sectoral cooperation.

Brief description of the general CTS mechanism: “Donor” (foundation, NGO, local budget, or business) shares with people stakes in decision-making on projects’ financing in exchange for people’s added values to the public goods (AVPG) following proposed conditions (smart contracts). Thus, the donor distributes the right to make decisions on projects’ financing to a significant number of local residents on the one hand, and significantly increases the impact of its investment due to the AVPG on the other hand. CTS uses PB-tokens as a unit of stake in decision-making, which is useful for distribution following smart contracts, so for further decision-making by people without regular need in their personal data. At the same time it provides local residents with a motivational mechanism to participate following smart contracts (SCs). SCs has a dual role here: game scenario and policy implementation tool. SCs can be designed and used for people’s collaboration and common addressing of different local issues and global challenges. 

For example, smart contract “Citizens engagement and Public monitoring” was piloted before the “big war”, a number of new smart contracts (humanitarian aid, assistance with transportation, interaction with IDPs, residents’ engagement, assistance in conducting events, sharing knowledge and skills, community security, etc.) were piloted to address new challenges in conditions of war and its consequences. 

CTS can be used within different models. For example, CTS model for participatory budgets works with financing from local budget, its second model aimed to address poverty through original support of MSMEs (this model was applied to SOLVE within Financial inclusion priority), the next one helps in communities transition to the circular economy through Library of Things (co-ownership and co-using). New model to support youth startups is under development (stage of survey of 500 children and their parents of pilot rural community). CTS piloting was supported by the NED, BST and GFCF and demonstrated impressive results for bridging civic knowledge with taking action, understanding real-world problems, building networks, organizing collective action. Please, watch this 10-min video of our key-expert and CTS founder with brief information about our solution and its piloting. 

We consider our solution as CTS and “know how” technology for its successful implementation in local communities.

Initially, our solution is focused on residents of small communities (up to 50,000 people), mostly in rural areas, which need to improve the quality of their lives. For various reasons, it is much more difficult for them to do this alone, and they need to collaborate with others. It creates the prerequisites for the formation of their interest in new knowledge and civic skills, but they meet with the above problems, which define their undeserving and a barrier to their target.

This description fits the profiles of at least 4 million people in Ukraine and at least 2 billion globally. 

Our foundation piloted CTS in 6 local rural communities from different regions of Ukraine with a total population of about 85,000 before 24.02. After Russia's invasion in 2022, active Ukrainian citizens were "rashists" preferred targets for torture and execution. We had to reduce the number of pilot communities to 2 for security reasons (Russia occupied one community, and others were too close to the frontline).

CTS helps people to get new knowledge and skills and provide changes in their communities: results of piloting for SDG 16.7, comparative results of CTS piloting for citizens engagement and public monitoring, piloting CTS model for participatory budget's mechanism in conditions of the war and its consequences.  

Survey of representatives of 25 local communities from 4 regions of Ukraine (interest in CTS as a potential for scaling).

Our team is working on developing and piloting solutions for local communities in close contact with representatives of local authorities, civil society, and businesses in these communities. According to the first results, our conference "Smart Interactions" became all-Ukrainian, and the government of Ukraine included our developments for cross sectoral cooperation in their annual programs.

My proximity to the communities was significantly strengthened due to my personal story. After Russia's invasion in 2022, the missile strikes began. After the first casualties in my home city, I took my two minor children and left for one of the partner rural communities in western Ukraine. For three months, we were IDPs, and I met with all challenges of the IDPs' life. On the other hand, it was an excellent opportunity for me to go deep into local life and needs, communicate with people and participate in common activities to address local issues. 

My personal experience has greatly enriched my background. However, the most significant influence on the team's engagement with communities comes from the decentralized structure of our informal partnership network, "Smart Interactions," in which local partners are the main drivers of change in their communities. The recommended video mentions them as a local hybrid team (representatives of local authorities and civil society). They help to provide local surveys and ensure communication with local residents and their engagement in the co-design and implementation of activities. It helps to grow the local "saving group" (also see video), which became the best solution for representing local communities and ensuring the integration of communities' input, ideas, and agendas into CTS through its smart contracts.

Two main barriers:

1. We used substitutes of PB-tokens during tests. It was perfect for reducing the costs of piloting; now, the absence of this specific digital tool is one of the main barriers to growth and scaling. 

2. CTS was integrated through nonprofit models, which is very good for reducing the costs of transactions. At the same time, the absence of a business model is a barrier to our work outside the grant market. 

My reasons for applying to Solve:

1. Solve’s recognition of our solution should be a very useful step toward growth and an excellent record for negotiations with potential partners.

2. I expect support in creating the business model and increasing human capital with interested experts who can support our growth. 

3. Some financial support for our growth will also be very welcomed.

CTS provides our clients with an original way of crypto tokens usage to address the problem. It helps to increase citizens’ motivation in civic learning and bridge their knowledge with taking action, understanding real-world problems, building networks, organizing collective action. My notes in the section “What is your solution?” provides additional details. 

CTS piloting confirmed its ability to work well even during blackouts, without electricity and Internet.

First of all, we consider the CTS as a tool for recovery and reconstruction of the local communities in Ukraine in the conditions of the war and its consequences. ”Reconstruction” is not about rebuilding Ukraine to the pre-war state; it is about a deep modernisation, where civic knowledge/skills and financial inclusion is an integral part of this process. 

We’ve already received interest from our colleagues from other communities and countries in piloting our solution in their communities. It looks like a good sign for its potential to grow and create ambitious impact goals for strengthening the resilience of local communities due to the CTS. During its piloting, the original implementation strategy was tested, and we consider it as an integral "know-how" technology for the CTS implementation and growth. We expect  transformational impact on people’s lives at least in 5 countries during the next 5 years due to the CTS. 

Our foundation is a part of the GFCF global network, which is our primary channel to expand CRF globally. We should develop some special IT-tools (blockchain) and establish partnerships with interested stakeholders/donors to strengthen our capacity for growth and scaling within the philanthropy sector. Governance sector is another target for CTS scaling through participatory budgeting mechanism and local financing (it was also already tested and proved in pilot communities). 

The civilized world helps us (Ukraine) survive, and in turn we will be happy to contribute to solving the global challenges with our solution.

CTS is a part of our general initiative “Smart Interactions”, its correspondents with SDGs targets you may find here.

Dashboard of the CRF’s progress indicators includes: number of the engaged people by smart-contracts (incl their gender, age, % under poverty line, concentration/distribution through villages of the local community),  level of their satisfaction from their participation and changes, size of their AVPG ($). The rest of indicators added depending on the specific CTS model (participatory budget, MSMEs, youth startups, LoT).   

In the context of the rapidly growing global competition between democratic and authoritarian governance models, we consider civic knowledge and skills as an advantage of the democratic model in addressing global challenges. It was a reason for us to design our theory of change to address one of them, poverty. It is one of the most relevant challenges for our target audience living in rural areas. This focus helps us consider SDG1 in developing almost any CTS model and its implementation, where civic learning and its bridging with taking action, understanding real-world problems, building networks, and organizing collective action is crucial.

This theory of change is available here.

It is a kind of hybrid based on blockchain technology, gamification, elements of circulation economy and some other techniques.

During piloting, our "solution team" uses Agile, whose values sound close to MIT's definitions. We tried to expand them in communities through a design of the CTS smart contracts and step-by-step implementation.

Now CTS is a nonprofit solution. 

Development of its business model in the future is one of our reasons to apply to Solve.

NOTE. The format of the next paragraph does not allow me to give a correct answer, so I have to give an explanation here. While I noted B2G below we have been working with local hybrid teams (representatives of local authorities, B2G, and civil society, B2B)

Its implementation into a participatory budget mechanism with financing from local budgets is a confirmed plan for financial sustainability. 

Further implementation into the philanthropic sector as well as its integration into the business sector due to the developed business model, will help to strengthen financial sustainability.

Foundation “Moloda gromada” engage private donations and has successfully grant experience, for example:

-2023 "Coalition’s recovery and emergency preparation" with CTS pilot scaling supported by BST (The German Marshall Fund of the United States), $15,250

-2022-2023 “Renewal of local communities in Ukraine with CTS, Ukraine”, supported by GFCF (17,960$). Project was aimed at piloting CTS (when CRF was designed) in two local/rural communities to strengthen their resilience on the basis of citizen participation in the conditions of the war and its consequences. 

-2021-2022, “Strengthening Public Engagement in Monitoring Reforms” supported by NED (35,000$). Project was aimed at enhancing citizen participation in the public monitoring of local governance and implementation of reforms at the local level in 6 regions. It was implemented in coalition with 10 NGOs with the help of the innovative outreach strategy to public monitoring and original IT tool for “Smart Interactions”.

- 2019-2020, “Strengthening democratic culture” supported by the Norwegian Embassy in Ukraine (50,000.00$). Strengthening democratic culture in local communities of 6 regions of Ukraine through providing transparent, participatory decision-making and open budgeting with the help of innovative mechanisms for cross-sectoral interactions, citizens engagement and ICT.

For a few years, the foundation "Moloda gromada" focused on piloting innovative solutions in rural communities with an annual budget of up to $60-70,000 (2022), which was enough for our tasks. Our solution did not need more money for successful piloting, and I believe it demonstrates strong financial capacity and ability to sustain plans financially.