For some time I have been thinking about a governance setup that is both practical and decentralised enough for a community to be safe from malpractice and abuse of powers. Various setups can be found in the crypto universe, from direct involvement in decision-making to quite centralised setups.
From my experience, I realise that the theory is mostly true in practice:
the more decentralised the decision-making, the less efficiently the organisation is managed
For sure the topic at hand plays a large role in the level of decentralised voting required. Some decisions are so foundational to the community; Voting on such may need to be at the highest level of decentralisation, ie at the community member level. However other types of decisions may require speed such as (daily) operational decisions. These are for instance deals with external parties, paying bills received, certain developments, hosting, marketing or whatever costs are within the authoritative scope of the community-chosen topic owner.
Effective and Efficient Decentralised Governance
In essence, an individual or team of individuals are elected by the community, per topic and task or multiple thereof. These elected users receive a set of authorities coming with the job. Let's call these users topic owners.
But that is not all...
What we can learn from the Centralised World
In the (centralised) business world in which the daily operational powers are with the board of directors, this board doesn't have the ultimate and unlimited powers. In a standard setup of such a business organisation, a supervisor board exists with special powers. They have the power to take the power away from either a single member of the board of directors up to the whole board itself. While the supervisor board shall not intervene in the direct operations of the company, it shall make sure the board of directors are acting in the - best - interest of all its stakeholders.
In reality - in quite a lot of countries around the globe - the stakeholders are more or less limited to shareholders only. But stakeholders can shall include all other stakeholders in the business, including employees. Stakeholders may even include the village, giving home the employees. But all this is perhaps less relevant for the discussion today. Food for another post 😉
The members of the supervisor board shall work independently from the board of directors without obvious conflict of interest, which isn't always the case in reality.
Supervisor boards in the Decentralised Governance system
Applying the above in communities aiming for decentralisation, we introduce the equivalent of the supervisor board which you can see depicted in the image above, to the right. To add another layer of decentralisation, instead of a single supervisor board, multiple supervisor boards can be installed. Each board executes the same task, supervising the board of directors or as I called them topic owners. Whenever a supervisor board thinks they need to execute their power, the other supervisor boards need to form an opinion. Per board a decision. The majority of these board decisions determine the result.
As already briefly mentioned before, each member given a set of authorities will be elected by the wider community. Periodically, elections are held. Additional elections can be held, when required, for instance when the supervisor board sends one or more topic owners home.
The setup of the governance - one or multiple supervisor boards - will be defined per topic. For instance, a topic owner receiving the authority to onboard new CEX listings will be supervised by three supervisor boards. For instance, the topic owner receiving the authority to spend the day-to-day marketing budgets may be supervised by just a single supervisor board. The community will decide on the setup through direct voting on proposals for the topic including the authorities such topic owner receives and the number of supervisor boards.
To set this whole system up with a one-round community vote, care must be taken in formulating the proposals. If needed a multitude of proposals will need to be put forward. Selectable parameters during a vote would make the voting seemingly more complex. However, this could reduce the number of proposals that need to be formulated for a simple yes/no vote.
At all times, the community keeps the power to send any single member, a set of members or all members of the governance system, home. A majority vote from the community is required for this.
More details need consideration, including but not limited to:
- What authorities a topic owner receives
- Skills of a topic owner and supervisor board member
- Whether subject matter expertise is required
I am not conclusive about the above-mentioned topics. I prefer subject matter expertise, though I like to see appropriate skills as well. Some of those skills could be to bring out the best in peeps and get advice from subject matter experts.
Regarding the topic owner authorities: This will always be very tailor-made to the community. Perhaps the set of authorities for a specific role or topic owner needs to be decided on - with a vote - by the community at large before elections are held to put topic owners and supervisor board members in place.
Election system: Considerations
The election system itself has a few variables that need a decision, with the most important ones being:
- Majority vote based on 50% + 1 or perhaps 60/40, 70/30 or some other ratio?
- Stake, Holding or User-based Voting (or a combination thereof)
- Time till the next elections
ad 1) Although I may be wrong, I think 50%+1 is a good ratio to start with. I believe we can adjust this ratio - through a community vote - whenever this is wanted.
ad 2) I think user-based voting needs to be put in place, even though it is not trivial how to implement such a system. It is true that stake/holding-based voting appeals to the more skin-in-the-game philosophy. It is true when someone has more to lose this can have positive effects. But at the same time, this can result in unwanted effects as well. A few may own the majority stake. Since this can always be the case, now and anytime in the future, such stack/holding-based vote power, isn't the best for governance voting. Therefore I suggest we find a solution to a vote per user with each user vote having the same power.
ad 3) A year is perhaps the most common, however, this period can also be shorter when this makes sense. A balance needs to be sought between the length of an elective period, and the time needed to get fully effective in the role.
Transparency and Tools
An important - perhaps the most important - factor in decentralised governance, is transparency. Usually, in decentralised communities, we see numerous channels in which discussions take place. From Medium - and HIVE - blog posts to more than a handful of Discord servers to a gazillion Telegram channels. For the wider community, it becomes impossible to follow them all.
Therefore for any decentralised governance system, a central spot is required where information is provided and discussions take place. Information can be anything, from ideas, concepts, and plans, to progress reports, achievements and whatnot.
When we want to have active involvement of the wider community - even when only during a voting round - we have to make it easy for the wider community to get to the relevant information.
Am I too Pragmatic?
I realise plenty of members of decentralised communities believe in - almost - absolute power by its members without any central entities. But it isn't very efficient in daily operations. That is why I ended up with the model I described above. To allow for effective and efficient governance whilst sufficient control is put in place to prevent abuse of powers. To be as pragmatic as possible. However, I may have been a bit too pragmatic: You tell me! 😉
Tell me What You Think
Am curious about your thoughts and opinions regarding decentralised governance in general as well as the proposed setup. I love it when you're super critical. Bring me opposing opinions. Am very much interested in your thoughts that lead to such opinions. Let us discuss!
Hi, you know I'm a real anarchist, and the idea that there is a system simply puts me out of tune. I'm approaching this from a philosophical point of view. Imagine that we live in a tribe of hunters, and there is a pack of deer that could supply food for the entire winter. Now, imagine a voting system to decide if it is or isn't an opportunity. Picture the time spent discussing the situation, debating how many men we're supposed to send, and while we are voting, the deer are gone.
If everyone is responsible for food for everyone, there would be no voting system, just action. The point is that perhaps we need to start thinking from another point of view that is not related to profit. No matter what profit is, it has to be based on the needs of every single person. In order to satisfy every need and desire, the only applicable law is pure anarchy. Gandhi used to say, "If you want to have a clean world, give a piece of land to every human being and tell him to keep it clean."
But please do not miss understand me, it's just a philosophical point of view to explore new ideas :) hugs
Thanks very much for your thoughts. Greatly appreciated! 🙇
Although I am not an anarchist, I LOVE the idea that we can do without much we have today, like country borders, like central institutions, like law books.
Although I don't know what exactly the true anarchist philosophy is, and I so very much like your point of view, I usually summarise what we need in just a five-word sentence:
Respect for Everything and Everyone
If we all live by that sentence, we don't need laws, we don't need anything. We simply will take care of everyone who needs care. We will also get the deer since indeed, we didn't have to debate before shooting.
That said, perhaps we wouldn't have shot the deer, since perhaps we felt like: Uhm that animal can't defend itself from our spears and guns, while we can't kill that same deer if we wouldn't have had a spear or gun 🙃
ps for the first time I counted the number of characters in the 'Respect' thingy: 35 in total including the four spaces. Just 35 characters away from absolute magic 😆
Hi -- Respect for Everything and Everyone; this is the point my friend, we just need to understand that we are born to help each other and not to control each other, i will write a nice editorial on what it means to be anarchist in 2023... thank you for reading my comments.
In essence, live life like a Buddhist. Help others and happiness comes to you. Ok, that is quite a short-cut summary of what Buddhism is about, but captures its essence for what I know from this life philosophy.
Can you believe it? I have been in heavy discussions over the word 'Respect'. Those who believe it is not possible: the word 'Respect' has different meanings for different people. Although this may be true, whenever we start defining what respect is, then we end up with big-ass law books again 😂
Drop me a link when you publish your write-up. Likely I'll see it anyway, but who knows, I may overlook your post.
I like the idea of accountability. The chart you've drawn is pretty much that - a tool for accountability. It's why we doctors are tied to licenses - for accountability. If there is abuse or malpractice, the license can be stripped off, and we lose our ability to work as doctors.
I see these two points as the base criteria to become topic owner and part of sup board. If the learned people of the topic aren't playing the active roles, why are they there? Surely not for their beautiful smiles.
In a decentralized community setting, 50%+1 or any other ratio doesn't sit right with me. Instead, a cut-off system would work more fairly. Say, active members of the community may or may not vote on a control/test owner, valid for a selected amount of time. The votes received mark the threshold. TO then elected in if they have received enough votes to surpass the threshold on the control/test owner. This leads to my next point:
Now I'm going to play devil's advocate and say that the SB is an overkill. It can also be the point of weakness. SB can be totally eliminated if there is transparency from the TO's side. If and when TO are not upto par, or not transparenct, or proven to be incompitent, they can be unvoted by the community members until below the threshold and voila, a new TO needs to be put in place.
Concerning time until new elections, as long as its not permanent. Well, with the threshold system, it can never be permanent. However, one of my favourite changes in HIVE governance was when witness votes were changed so that they could expire. I think a year is good enough.
This is only possible with KYC. Only then one vote can be counted as one singular vote. Otherwise, proxying and multi-accounting can always change the tides. This is why POS is still the most popular choice in many decentralized communities. It has shortcomings, but until a better option, this is what exists, right?
Thank you for sharing your thoughts, ideas and opinions.
50%+1 or something in that order: True this shouldn't be on the whole community as in all those who have powers to vote, since as you suggest: Plenty aren't active. However still, a ratio can apply based on those who voted. I'm not fond of the 50%+1 too much since the yes/no voting is equally in size when it is that close. That is why I usually like a system of 60/40, or what we do in Dutch Ltds, for important foundational changes (constitution and all), the ratio is 66%/33%... but ok we don't do that for selecting peeps. In our political system we have the measure that when constitution changes are proposed, re-elections need to be held to allow the public to vote yes/no to such proposed changes.
Supervisor Board: I get you regarding the transparency. However, we have seen in our HIVE ecosystem/community (and I've seen similar in other communities) that transparency isn't there and it can take months to years before someone decides to play detective on someone to uncover wrongdoing. That's why I think an additional elected body, or multiple thereof, is very beneficial, perhaps even required. This doesn't take away the community's powers though. I mean, the community can send not only the topic owners home, but also the supervisor board(s) members. Essentially the SB gives an additional safety measure against abusive elected peeps. But I agree with you, it shouldn't have to be, the community should understand that in a decentralised world, the community also have obligations to make sure those in power with whatever authorities are using them wisely instead of abusively. However, the reality is different though.
POS vs Individual Vote: As for chain management, a POS system works well. But not everything can be captured by code, especially not when we replace more than the existing financial system, which is where I am coming from. Let us imagine a world where we don't have country borders anymore, no central institutes and authorities, and perhaps not even a law book, I don't like to see that money/wealth is the foundation of community rulings. Therefore we must find solutions to make sure we can create a voting system based on individuals. Am not sure how far those who researching such topics are, but I can imagine we gonna end up with Smart Contract-based KYC. Nobody will be involved in the KYC other than one or a set of Smart Contracts. Such a system can create a single and unique profile for every individual, with the individual given the sole power of permission management of your profile. KYC can then be done by whatever dApp by simply querying the individual's profile with a question or set of questions to which the response is either 'yes' or 'no', without factually giving out more information. Needless to say for different types of votes, we can use different types of voting systems.
Big thanks for snagging your Walk Bridges - Build Bridges ticket!
Stay in the loop for all the updates, tips, and announcements under the #buzzparty2024 tag!Well said, there are a number of benefits to centralization in a decentralized space. We wouldn’t have as much development going on if blocktrades didn’t have a solid and centralized team though is by no means the owner of the ecosystem. It’s all about balance!
100% indeed
i like a lot that you are discussing this. i've not taken the time to understand it properly yet but i think i get the gist.
You may or may not know i'm an advocate for The Matrix-8 Solution and have ideas not yet written regarding right to vote / voting power based on various factors including knowledge tests for the subject/area in question.
Am looking fwd to your ideas regarding voting. In any case, when you have something written down, please share.
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