The idea is that each token represents a “claim check” on a bounty awarded to the project. This provides an elegant way to align project contributors around attaining a specific outcome sans the ability to pay volunteers up front. Let’s take a practical example:
Message Everywhere as of this writing is the most active project on Problemattic. It is currently competing for the Bridge the Gap bounty which comes due March 1st 2025.
This is the current token allocation on the project as of today:
Per this current allocation there are a total of 258 tokens allocated amongst 12 contributors. The “Bridge the Gap” bounty has the following stats:
Assuming the success criterion were met today and the bounty were immediately awarded at current prices the total bounty value to be distributed to contributors would be $6506.19 and it would be awarded pro-rata to all contributors based on their share of the allocated tokens.
So for instance Sreeharsha with 18 tokens would receive: 18/258*6506.19 = $453.92 of the $6506.19 total award.
See this QA post for how the different types of bounty awards are handled with different funding types and winner selection methods.