In our initial report, we shared the origins of Zenbit and established our objective of addressing the public needs of the Santa Mónica 2 neighborhood in Querétaro, Mexico. We collaborated closely with residents and the government to address these needs and ensure transparency throughout the process. Our work continued at the Technological Development and Innovation Unit (UDTEI) of the Autonomous University of Querétaro, where we began researching and integrating decentralized technologies to create a public, open, and economically sustainable urban data system. Additionally, we explored how these technologies can help overcome the challenges faced by early-stage tech and scientific ventures.
Zenbit Operational Model
Over the past four years, we have evolved into Zenbit.eth, an organization focused on Research, Development, and Innovation (R&D&I) for public goods in cities. Initially, we aimed to establish ourselves as a Simplified Joint-Stock Company (SAS). However, the COVID-19 contingency caused significant delays in government procedures, and due to a lack of liquidity for legal and operational expenses, we turned to decentralized technologies for funding and talent. This shift led to the formation of a Decentralized Autonomous Organization (DAO), zenbit.eth.
The efficiency of the decentralized organization has been proven through our connection with global talent via hackathons, as well as the development and implementation of automatable and deterministic contracts and standards for Zenbit, using Open-Source Software (OSS) and Ethereum technologies. Additionally, we have leveraged on-chain funding programs to enhance and increase capabilities in our prototypes and carry out technology transfers. Thanks to decentralized funding, we have covered local operating expenses and global talent coordination, generating income and liquidity for Zenbit with weekly increases from decentralized finance mechanisms. This has significantly improved our responsiveness and adaptability in developing solutions to meet urban needs.
Locally, our constitution as a SAS has allowed us to develop and implement projects consistent with the reality of Querétaro, Mexico, strengthen our commercial, academic, and institutional relationships, and collaborate with local and federal governments.
Based on this experience, Zenbit operates as a SAS and a DAO. Despite the differences in operational, financial, and governance mechanisms between the two structures, those of the DAO are comparable to those of the SAS, albeit they vary in magnitude, security, and efficiency. Therefore, by merging both, we have established a hybrid model that allows us broader access to products, services, and intangibles at the local and global levels. This approach is consistent with Zenbit's vision of designing based on user needs, implementing decentralized technologies, and collaborating with talents regardless of their geographic location to improve the quality of life for citizens and urban management.
R&D Model: Zenbit Stack
All this journey and our experience have materialized in the Zenbit Stack, a Research and Development (R&D) model for cities designed to streamline coordination between local talents and connect them with world-renowned mentors. This model tackles urban challenges by facilitating scientific research projects and fostering collaborations with the private sector and government entities.
The Zenbit Stack does not seek to compete with conventional centralized public budget systems but rather complement them to overcome their limitations. It focuses on developing technological capabilities to generate a public digital infrastructure, driving the creation of startups in the decentralized technology industry and its application across various economic sectors. Thus, the city and its inhabitants have the necessary resources and assets to reach their full potential.
The Zenbit Stack comprises three levels. Its base is Collective Research, Development, and Innovation, defined by four pillars that characterize the operation, logistics, communication, and linkage of the Zenbit team with emerging talent. This base level facilitates the development of exploratory and applied research projects collaborating with specialists, focusing on implementing Ethereum and decentralized technologies in cities.
By characterizing this level, we identified that the legislative pillar could provide a local competitive advantage by driving legislative proposals to formally acknowledge Decentralized Autonomous Organizations (DAOs) as commercial or civil entities. This approach would allow the development of a reference framework for implementing decentralized infrastructure in public processes. Starting in 2022, this base was consolidated in Zenbit through an ongoing and iterative process and refinement of the public goods produced by the global talent that has collaborated in recent years.
The following levels of the Zenbit Stack refer to the integration of technological capabilities, which we will develop in the coming months. The second level, Infrastructure for Cities, consists of three protocol-level components aimed at driving a new industry for the city and leveraging the production of public data to create new highly specialized jobs dedicated to generating digital infrastructure.
The first component is OP City, an Ethereum Rollup dedicated to cities that enables the efficient and economical processing of large volumes of public data transparently and verifiably. This system will integrate machine learning and artificial intelligence algorithms with zero-knowledge technologies to extract and analyze relevant data, enabling informed decision-making while protecting citizens' privacy. In addition, this level will also include the acceleration of models focused on developing the city's scientific and technological capabilities.
Together, these decentralized user-focused functions, structured in the third level of the Zenbit Stack, will enable the validation and authentication of urban data, incentivize sustainable mobility practices, promote citizen participation, address urban needs, verify the identity and authenticity of individuals in digital interactions, as well as automate urban processes and improve the efficiency of public services.
Projects and Results
The experience earned from iterating our projects in real-world environments has enabled us to generate the Zenbit Stack and develop key technological components. At the City Infrastructure level, we have progressed with the OP City project, while at the user-focused applications level, we have developed Zengo, Supercities, and Zenbit Badges.
Zengo: Decentralized Budgeting
Zengo is a platform developed to manage public proposals focused on improving urban spaces through a decentralized and transparent process that includes registration, verification, quadratic voting, and initiative monitoring. Its purpose is to empower citizens and foster collaboration with government representatives, civil organizations, the private sector, academia, and other stakeholders. Additionally, it promotes decentralized urban governance and transparency and fights corruption, ensuring that public funds are used transparently and efficiently for the community's well-being.
From the pilot test carried out in the city of Querétaro during the second half of 2023, Zengo has achieved remarkable results, such as participating in the 2023 Transparency Innovation Contest organized by the National Institute for Access to Public Information (INAI), a federal agency in Mexico. Furthermore, it participated in the 3rd round of Retroactive Public Goods Funding (Retro PGF3), where, with 27 ballots from Optimism Badgeholders, the collective rewarded us with 24,845 OP tokens. Zengo has also been included in lists such as Bear Market Builders, End User Experience & Adoption Projects, and Ecosystem Impact Vectors, highlighting its relevance and effectiveness in decentralizing public funds.
Zenbit Badges
Zenbit Badges is a platform that allows on-chain certification of activity completion and the acquisition and application of web3 knowledge during in-person or virtual events, facilitating the use of the Ethereum Attestation Service (EAS). It has a contract deployed on the OP mainnet that allows registering events, mentors, and participants to issue automated attestations on behalf of badges.zenbit.eth. Currently, it verifies Optimisim Onboarding and DAO Formation.
Zenbit Badges has completed three events and has one active. Two of these events were conducted in collaboration with Arkansas State University, Querétaro campus, Mexico, certifying students and teachers for their acquired knowledge and skills. Additionally, the technological project Axolotarium formed the DAO axolotarium.eth to implement decentralized technologies in preserving the axolotl, an endangered species endemic to Mexico.
The third event allowed the formation of the Zenbit VG subDAO, facilitating participation in the 3rd round of the Dark Forest game, organized by the DFArchon community on the Redstone chain. After seven days of intense competition, two members achieved positions in the Top 10 and distributed 420 OP tokens among non-core Zenbit collaborators.
Finally, the fourth event is active and focused. In June of this year, it will provide residents of the Felipe Carrillo Puerto Delegation in Querétaro with knowledge about Optimism. The objective is to create a DAO for its neighborhoods using Zenbit Badges.
Supercities
In Supercities, we implemented the MUD engine developed by Lattice to improve public data management and facilitate modularity between the different urban experiences previously prototyped by Zenbit, built during the 2023 Autonomous Worlds hackathon. Its objective is to provide a user experience with as little friction as possible, leveraging MUD's capabilities to link smart accounts and enable urban verifications, mobility rewards, decentralized governance, human authenticity tools, and autonomous agents on an integral platform.
We paused the development of Supercities temporarily due to limited funding received from our participation in Round 9 of the Quadratic Funding organized by CLR. However, the project will resume in the third quarter of 2024, thanks to the support obtained from the third round of Retroactive Public Goods Funding (Retro PGF3).
OP City Stack
Although we can expand Zenbit's solid technological core with Supercities, technological and operational limitations were evident in its proof-of-concept tests where due to the intensive use of on-chain contracts to register and update urban data, which would generate prohibitive gas costs on the Ethereum mainnet. To address this problem, we explored Layer 2 (Layer 2, Rollup) solutions to reduce operational costs. Although we managed to reduce costs through tests on Optimism, they remained significant in intensive platform use.
During this process, we identified Redstone as a variant of the OP stack that implements Plasma technology to reduce Data Availability costs, making the deployment of Supercities sustainable. However, the growth of our knowledge in the OP stack led us to conceive the idea of developing a city-dedicated Rollup, integrating functionalities for Large Language Model (LLM) inferences in public data processing through Optimistic Machine Learning (opML), and providing privacy tools through ZK and Optimistic Privacy Preserving AI (oppAI).
We are currently in the research phase, thanks to the approval of funding for our proposal by Optimism's governance. We prepared the grant proposal in collaboration with Dr. Cathie So, an expert in ML/AI/ZK. The collective granted funding for this proposal during cycle 22 of season 6 of Optimism Governance, and it will be developed over 12 months, starting this month.
Initiatives
In addition to the projects that underpin the Zenbit Stack, we are also involved in initiatives with global web3 communities and protocols. We recognize the importance of these collaborations to strengthen our ties with talent in non-technical specialties. However, our participation depends on the operational availability of Zenbit's collaborators.
Quadratic Funding with Gitcoin
During 2023, we participated in two Gitcoin quadratic funding rounds (Beta Round and GG19), seeking funding to support our project development and cover operational expenses. Although the results were moderate, the analysis of 471 projects in the main categories of the Beta Round stands out.
Fundcaster
Fundcaster is an application that facilitates the creation of funding campaigns in posts on the Farcaster social network. Developed at the 2024 Frames Hackathon, it won the Best No-Code Tool award for simplifying the programming of contracts that manage donation campaigns. It is accessible to any user regardless of their technical skills.
We Love The Art de Optimism
In late 2023, we participated in the Optimism We Love the Art contest in the AI ART category, presenting our work Zenbit City. This artistic piece, generated with Stable Diffusion, represents an optimistic vision of integrating public goods into urban environments, reflecting our commitment to strengthening emerging technologies for the benefit of citizens.
Builders Council with SEED Latam
We have been actively involved in Optimism's governance ecosystem. Additionally, thanks to our experience and collaboration with SEED Latam, we have played important roles within the Optimism ecosystem. Habacuc.eth, the founder and R&D director of Zenbit, participated in the Builders Sub-committee of the Grants Council during Season 5, supporting the delegate Joxes. The delegation reviewed over 300 proposals in this role, and the collective recognized their Optimism Grants Council analysis posted in the forum. This exercise provided a deep understanding of the governance processes, so we will seek to continue our collaboration with SEED Latam to participate again in Season 6.
In summary, the period since May 2023 has represented significant progress for Zenbit, thanks to its hybrid operating model as a DAO and SAS. This combination has provided us with a favorable environment, resources, and access to global talent to build our vision sustainably. Over the next 12 months, we will focus on the comprehensive development of the Zenbit Stack across its three levels, with Querétaro, Mexico, as our base of operations. We will collaborate closely with local universities, research centers, and civil organizations to foster the adoption of decentralized technologies, facilitate the linkage between emerging talents from the region and global experts, and promote technology transfer to catalyze the development of the local industry.