Revitalising Media with Quadratic Funding: A Web3 Solution to Support Quality Journalism
In Brief
Journalists face financial and ethical pressures due to profit-driven models, sensationalism, and clickbait headlines. Web3 ecosystem’s quadratic funding could revive journalism.
The current state of journalism is precarious: dominated by a handful of media giants who prioritize ad revenue over social good and access to information, today’s media landscape is straining under pressures – both financial and ethical. Profit-driven models have driven a reliance on sensationalism and clickbait headlines, compromising the quality of news and its role in civilization. This phenomenon has left us with an increasingly homogeneous news media and a widening disconnect between journalism and public trust. However, all hope is not lost – an emerging solution from the Web3 ecosystem could be the key to reviving journalism: quadratic funding.
The Downside (and Downfall) of Ad-Driven Models
The traditional financial structures of journalism have been strained by the shift to online media, with many – particularly smaller, local outlets – failing to keep up. News outlets are now increasingly reliant on subscriptions and have seen these dwindle in recent years, coupled with the additional problem of advertising dollars flowing disproportionately to tech giants like Google and Facebook. The result? Traditional newsrooms have shrunk, while some newsrooms have become dependent on external interests – such as those of corporations or governments – ultimately threatening the independence of journalism.
Media globalization has only exacerbated this issue, allowing a handful of large media corporations to dominate information flow. This has fostered a race to the bottom for clicks, leading to superficial, often incorrect, coverage and editorial boards that value traffic over the truth. What’s missing is a financial model that aligns with journalism’s public service mission, which should be at the heart of all media outlets and is unfortunately not the case in the current landscape. Quadratic funding could be the answer, encouraging more diverse and reliable news content by aligning financial incentives with the public’s genuine informational needs.
How Quadratic Funding Can Reshape Journalism
Quadratic funding is a pioneering funding mechanism that seeks to create private markets for public goods, enhancing outcomes in a way that better reflects community preferences compared to traditional market systems. It achieves this by establishing a matching pool for financial contributions to various projects, using a unique formula that emphasizes the number of contributors over the size of individual contributions. This mechanism, which operates as a middle ground between democracy (“one person, one vote”) and markets (“one dollar, one vote”), allocates resources based on collective support rather than wealth alone. Quadratic funding’s matching-based approach prioritizes projects with widespread backing, distributing pooled funds to those with broader, not just wealthier, support bases.
This system offers a new approach to financing public goods by decentralizing support, democratizing funding, and ensuring quality. In a quadratic funding model, the emphasis is on the number of unique contributors rather than the contribution amounts, making it a truer reflection of community interest. For instance, if numerous people each give small contributions to a story or project, it will receive more matching funds than if one wealthy contributor made a single large contribution. By implementing this “quadratic rule,” the mechanism resists the disproportionate influence of the wealthy, supporting a more diverse range of ideas and projects that reflect the values and interests of the broader community.
In this model, contributors play a crucial role in sustaining the economic viability of information production, taking the reliance away from traditional advertising or subscription fees. This approach promotes a more democratic and equitable allocation of resources. By contributing as a donor, individuals directly bolster a collective intelligence accessible to anyone with an internet connection, helping to nurture a media ecosystem that values inclusivity, accuracy, and accessibility for all.
Through the power of quadratic funding, even a modest contribution can lead to a significant impact. This shift has the potential to radically alter the media landscape, making quality journalism more sustainable and community-oriented, in direct contrast to the system it is currently built on. With quadratic funding, public interest, rather than corporate profit, can shape what stories are told. For journalism, this approach shifts power back to readers and away from advertisers or corporate sponsors.
Better for the Reader
Quadratic funding could transform the way we consume information. By prioritizing stories that resonate with the community and supporting independent voices, this model helps ensure that diverse perspectives thrive in a digital age. The news industry’s current trajectory has failed to serve the public good in the way that it is entrusted to. In a quadratic funding model, the community directly influences what topics get covered, creating a more democratic – and demanded – media landscape.
Moreover, the rising issue of misinformation – what the very lack of trust in the media is symptomatic of – may find its solution. Current fact-checking approaches, predominantly centralized, struggle to keep pace with the sheer volume of content. Stories based on public interest, supported by many small donors rather than a few large stakeholders, stand a chance of being less sensationalist.
Additionally, quadratic funding encourages independent fact-checkers and researchers by providing them a direct route to financial support based on their credibility and community backing. This could create a self-regulating mechanism where the community rewards accuracy and depth.
Better for the Writer
Investigative journalists and small, independent outlets gain an opportunity to compete without compromising integrity or pandering to sensationalism. By prioritizing projects with broad community support rather than large financial backers, quadratic funding empowers these journalists to pursue in-depth, high-quality reporting that might otherwise struggle for funding.
This system not only levels the playing field, allowing smaller outlets – such as regional and trade publications – to operate and thrive alongside conglomerate platforms, but also encourages a more diverse range of perspectives within the media landscape. Ultimately, it promotes a healthier media ecosystem, where journalists are incentivized to prioritize quality, foster trust with audiences and ensure that essential, public-interest journalism is accessible – and sustainable.
What is the Future? A Step Toward Restoring Public Trust in Media
We have already seen the success of such mechanisms with Gitcoin, so why stop there?
Journalism dates back to ancient Roman times, and since its creation, it has developed and adapted – what has remained central is its essence to a functioning democracy. Through blockchain technology and the use of models such as quadratic funding, we are in the next stage of journalism evolution, moving towards a more open, trustworthy, and financially viable model. As I see it, we are on the cusp of a media renaissance as we look to return power back to the readers and hold journalism accountable to its highest mission: informing the public and upholding the truth.
Disclaimer
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About The Author
Ciarán Murray, the founder of Olas, has extensive experience in the blockchain industry. He has been involved in various blockchain projects over the years and recently developed a proof-of-concept for synthetic assets. Before his work in blockchain, Ciarán had a career in the media industry, including a role at British Sky Broadcasting. His background provides him with a unique perspective on the challenges within the media industry and how blockchain and distributed technologies can be applied to address them.
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Ciarán Murray, the founder of Olas, has extensive experience in the blockchain industry. He has been involved in various blockchain projects over the years and recently developed a proof-of-concept for synthetic assets. Before his work in blockchain, Ciarán had a career in the media industry, including a role at British Sky Broadcasting. His background provides him with a unique perspective on the challenges within the media industry and how blockchain and distributed technologies can be applied to address them.
