Donut Protocol's open source platform for credit risk algorithms

What is an algorithm open source platform?

Simply put, the algorithm open source platform allows enterprises or professional users to provide their voluntary open and shared risk assessment algorithms in Donut’s open algorithm database to users. It allows Donut to better control and improve the algorithmic capabilities of the system, and can provide users with more reliable financial analysis services, thereby helping users better manage asset risks and improve financial results.

Donut Protocol open source proposition value

Donut Protocoal tries to use the existing model of the DAO governance model in order to provide users with a wide range of useful, competitive, safe, reliable, open and transparent financial market open source economic risk management platform-in the information disclosure era, Donut deploys advanced encryption Ways to protect privacy in some areas, while providing much-needed transparency in other areas.

What algorithm data does Donut contain?

In order to achieve this goal, in the initial stage, the Donut platform uses the original algorithm model to provide users with basic credit risk assessment services.

At present, Donut’s own algorithm model is customized and rectified based on the traditional credit risk evaluation model. Through the comprehensive evaluation capabilities of multiple algorithm models, it provides users with risk reports. Such as Linear discriminant analysis, Linear regression method, Logistic regression method, Decision tree induction, etc.Third-party algorithm providers can redesign and redevelopment on the basis of Donut’s original algorithm model. The algorithm model provided by the third-party algorithm provider in the Donut algorithm open platform will also be included in the initial selection, but the third-party algorithm must be tested and verified and most of the voting by the algorithm committee before it can be officially opened to users.

Once the system has received good feedback, Donut can consider expanding the access capabilities of the algorithm database, such as providing algorithm revenue capabilities for different contributing users, and the provider can provide algorithm models for a fee to obtain steady income.

Algorithmic revenue

Algorithm revenue mainly starts from the dimension of measurement value, selects effective measurement indicators in each dimension, and evaluates the activity evaluation of algorithm connection degree, algorithm quality value evaluation, algorithm scarcity and timeliness evaluation, algorithm application scenario economic evaluation, and optimization The method of algorithm service application maximizes the application value of the algorithm.

For example, algorithm popularity and breadth can be selected as reference indicators of algorithm value, and algorithm assets can be efficiently controlled and rationally applied through ROI evaluation.

General rules

In an open community, common rules are needed to realize safe and efficient sharing of license algorithms among multiple participants. The main goal of the general rules is to protect algorithm providers to provide effective algorithm models under prescribed standards and improve R&D efficiency. At the same time, it also prevents the algorithm database from being infringed by bad actors. In order to achieve this, community design needs to center on algorithm providers and formulate rules in the areas of management responsibility, privacy and security.

Imagination of open source community management architecture model

In all DAO management structures, effective system governance is the key to success. In the entire community governance, governance should be fair, transparent and have clear responsibilities. Therefore, Donut’s open source community management is divided into a top-down governance model. The algorithm management committee at the top level, the algorithm management center at the middle level and the third-party algorithm provider at the bottom level. At each level, there are personnel with corresponding responsibilities to implement governance.

The following table is the main description and responsibility plan of each role in community management. The current plan is a preliminary idea. With the future development of Donut, the management design of the community will be gradually improved, which will bring abundant benefits to users or algorithm providers.

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