Proof-of-Donation

Proof-of-donation refers to the integration of charitable donations into the functionality of a blockchain. Typically, this describes a redirection of funds, set by a smart contract and triggered upon each transaction, toward a charitable destination. The charitable donation can be given to a wallet owned by a charity, or a separate fund whose funds are controlled by a DAO or other party.

Proof-of-donation is a modification of a traditional proof-of-burn that aims to bring altruism and sustainability to the blockchain transfer model. As blockchain activity scales, given the programmatic redistribution of funds, the charitable donations will likewise scale and contribute to the sustainable growth of the network. 

An example of proof-of-donation is that employed by Hermez Network: coordinators bid for the right to process transaction batches using the token HEZ; 40% of each winning bid is donated to Gitcoin as a way to fund Ethereum public goods, while 30% is burned and 30% is redistributed to the network.