Architecture & Value Flow

How does the protocol works?

G$ is a digital asset designed to power the GoodDollar economy and the commons by creating money and distributing it as Universal Basic Income (UBI) and incentives that support real economic activity. It operates within the emerging ecosystem of decentralized and open finance and is issued by the GoodDollar protocol against a reserve of cryptocurrencies held in the GoodDollar Reserve.

The primary value in the reserve comes from investors, customers, and businesses that purchase G$ tokens in order to participate in and support the GoodDollar economy. Additional value flows into the reserve from supporters who donate the interest earned on capital they stake in decentralized finance protocols, strengthening the system without requiring the underlying capital itself to be donated.

New G$ tokens are created primarily by increasing reserve leverage through reductions in the reserve ratio. The newly issued G$ is then distributed through the protocol to support daily UBI payments to verified users, incentives for savings and participation, ecosystem development, and aligned projects, helping grow a sustainable and inclusive digital economy.

G$ tokens are always liquid and convertible to other cryptocurrencies, and can be bought or sold directly through the GoodDollar GoodReserve smart contract, enabling participants to easily enter or exit the GoodDollar economy.

How the GoodDollar system works

This is the money flow that underpins the generation of GoodDollar crypto UBI.

---

Overview

The diagram describes how GoodDollar governance, reserves, and distribution infrastructure operate across multiple chains (Celo, XDC, and Fuse) to distribute UBI and ecosystem incentives.

Three types of flows are represented:

• Governance (orange dashed arrows) – decisions made by the DAO and Guardians

• Money flow (blue arrows) – movement of funds and G$ tokens

• Identity verification (red arrows) – required to claim UBI

---

1. Governance Layer

GoodDollar governance is going through a restructure follow on https://discourse.gooddollar.org

GoodDAO

The GoodDAO is the primary governance body of the system. It defines policies such as:

• distribution rules

• incentives

• supported chains

• reserve management

Guardians

Guardians act as an operational governance layer that executes or oversees decisions made by GoodDAO.

Governance flow:

GoodDAO → Guardians → ecosystem components

Guardians influence how reserves, bridges, and chains operate.

---

2. The Reserve (Money Creation)

The Reserve is the financial engine of the system.

It creates G$ (GoodDollar tokens) which are then allocated to several purposes.

The Reserve generates G$ that flows into the Distribution Manager, which allocates it to:

1. UBI Distribution – daily payments to verified users

2. Savings incentives – rewards for participating in savings mechanisms

3. DAO Treasury – funds for governance and ecosystem development

4. House of Alignment incentives – funding for ecosystem projects aligned with GoodDollar goals

5. Other future utility - credit, cashbacks and subsidies

---

3. Distribution Manager

The Distribution Manager receives newly created G$ from the Reserve and distributes it.

From here funds flow to:

• UBI Distribution

• Savings incentives

• DAO Treasury

• House of Alignment projects

This component acts as the central allocator of G$ emissions.

---

4. UBI Distribution and Identity

To receive UBI:

1. A user must pass Identity verification

2. The UBI Distribution contract releases G$ to verified users

Flow:

Identity verification → UBI Distribution → Users

This ensures one-person-one-UBI.

---

5. Cross-Chain Expansion via the Bridge

The Bridge connects the GoodDollar system across multiple chains.

Funds from the Distribution Manager can flow into the Bridge, which then routes them to:

• other supported chains

• ecosystem projects

---

6. House of Alignment

The House of Alignment is a coordination hub for ecosystem projects that support the GoodDollar mission.

Projects in this layer can receive G$ incentives originating from the Reserve.

Purpose:

• align external projects with GoodDollar’s goals

• incentivize ecosystem participation

• expand utility and adoption of G$

---

7. Multi-Chain Deployment

The system operates across multiple chains:

Celo

The main infrastructure currently includes:

• Reserve

• Distribution Manager

• Savings

• DAO Treasury

• UBI Distribution

• Identity

XDC

Replicates the UBI infrastructure:

• Reserve

• Distribution Manager

• UBI Distribution

• Identity

Fuse

A lighter deployment focusing on:

• UBI Distribution

• Identity

Funds can be bridged to these chains to enable local UBI distribution.

---

End-to-End Flow

1. Governance

   • GoodDAO defines policy

   • Guardians oversee implementation

2. Money Creation

   • Reserves create G$

3. Allocation

   • Distribution Manager allocates G$ directly or via bridge to:

     • UBI

     • Savings incentives

     • DAO Treasury

     • House of Alignment incentives

4. Cross-chain distribution

   • Bridge routes funds to other chains and projects

5. User payments

   • Verified users receive UBI.

---

✅ Summary

The Reserve mints G$ tokens which fund UBI, savings incentives, the DAO treasury, and ecosystem projects. These funds are distributed by the Distribution Manager, can be bridged across chains, and also serve as incentives for House of Alignment projects, enabling a multi-chain ecosystem aligned around GoodDollar’s UBI mission.