# Crowdstaking

Supporters stake crypto into a shared contract and the generated yield funds public goods — contributing economic influence without losing principal.

**Crowdstaking** turns passive capital into recurring funding for public goods. Supporters stake crypto into a shared smart contract, and the interest or yield produced flows to impactful projects. Staked tokens remain the supporter's property — they lend their economic influence without losing their original assets. Breadchain is a notable pioneer of this model.

## How It Works

Crowdstaking generates continuous funding from idle capital without requiring supporters to spend.

1. **Supporters deposit crypto** (ETH, stablecoins, etc.) into a shared staking contract
2. **Assets earn yield** through blockchain staking, lending, or other DeFi mechanisms
3. **Generated rewards flow to a funding pool** automatically via smart contract logic
4. **Designated projects or causes receive continuous capital** from the yield
5. **Original stakes remain accessible** — supporters can withdraw their principal at any time

## Advantages

- Low participation barriers — people support causes without spending capital
- Converts idle assets into ongoing public goods impact
- Creates sustainable, predictable, continuous funding streams
- Aligns values with economics without extraction — supporters keep their principal

## Limitations

- Not suited for urgent funding needs — requires time for yield accumulation
- Cash flow depends on yield rates, which vary with market conditions
- Requires accessible staking infrastructure
- Low-yield environments make scaling difficult
- Needs trusted systems to allocate distributed funds

## Best Used When

- DAOs want long-term, sustainable public goods funding without depleting treasuries
- Mutual aid networks and cooperatives need continuous funding streams
- Ecosystem grants and shared infrastructure need predictable, ongoing support
- Communities embrace regenerative finance and want non-extractive funding models

## Examples and Use Cases

### Breadchain Cooperative Funding

Breadchain's yield-generating vaults support post-capitalist cooperatives — supporters stake assets, and yields fund regenerative initiatives.

### Protocol Builder Grants

Protocol staking pools where ETH yield funds ecosystem builder grants, creating sustainable funding without treasury drawdown.

### Regional Mutual Aid

Regional mutual aid networks use stablecoin yields for community services — healthcare, education, food sovereignty — funded by idle community capital.