Hi, I want to know what benefit Nostr is providing here, since Git is inherently designed to work with repos hosted anywhere and already supports cryptographic identities for commit authors. My first and most pressing question is: where are the repos hosted?

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Not the repos, but the patches and issues are nostr events. For repos there is GRASP, which use Nostr to check if the push authorized or not, instead of ssh keys in regular git server. So you create a single nostr event called Repository State Announcement, and push your repo to 5 GRASP server, they will not ask you for an account, they will just check that the repo state match the nostr one.
Nice, thanks for the info, very helpful! I don't currently know anything about Grasp, but I would expect that it handles authentication simply by allowing anyone to upload any commts anywhere, but checking whether branches, tags, and other such labels are authored by authorised persons, depending on the specific repo owner and repo name that those labels are pushed under? If it's done in that way, then forking would be very straightforward as far as backend implementation is concerned: just create a new set of labels pointing to the same commit-ishes/tree-ishes under a different owner name and/or repo name.