The article provides a comprehensive analysis of the legal framework governing mechanisms for citizen co-financing of government projects. The study reveals the hybrid nature of these relations, which exist at the intersection of public and private law. It focuses on analyzing the new legal basis, particularly Federal Law No. 33-FZ of March 20, 2025, identifying a lack of procedural detail that leads to fragmentation and a multiplicity of regional approaches. The paper systematizes two main models for attracting citizen funds in Russia: the public-law model (participatory budgeting) and the private-law model (crowdfunding), highlighting the legal risks inherent in this dualism. Using the Law of the Donetsk People's Republic of May 23, 2025 as an example, a set of proposals for improving regulation is developed, including establishing a minimum co-financing threshold, detailed regulation of document flow, and clear mechanisms for public control. The examined foreign experience indicates a transformation of participatory budgeting into a simplified mechanism, which can negatively impact municipal finances. The scientific significance of the work lies in the systematization of legal co-financing mechanisms as of 2025.
