On a Principled Approach to Blockchain Governance - 7 Requirements

5 months ago
in eos

One of the things that I learnt in the CAcert adventure was that governance was critical to the safe operation of large communities. How large is large ... is a question of much debate, but to put it bluntly, this is needed beyond say a 2 digit size, which I’ve always seen as around 30, but certainly well before Dunbar’s number of 150.

Now, the problem with governance is that once it’s in place, it becomes power. And power corrupts. So as technologists we like to try and invent things that take the power back out of the hands of the powerful, the corrupted, and place them into the technology. Tech can’t be corrupted, right? That’s a joke...

Some might call this decentralisation, but that places a technique to the fore, not the purpose. We don’t decentralise for the sake of it, we do that because we want its benefits, which work sometimes and sometimes not.

Principle - Automate what we can, govern the rest

A general principle in life is, what power struggles we can automate, we do, and what’s left over is the responsibility of the governance layer (which I called layer 5 in FC7). This is a long standing principle, going back to the invention of the chief, the secret ballot, the bribe, and although Bitcoin’s blockchain represents a stunning advance, it is probably only shifting the governance dial by 1% in the historical context.
Financial Cryptography in 7 layers

By which I’m trying to say: Governance is a thing, and I for one believe that it is an unavoidable thing. Those that are claiming it’s not necessary for e.g., blockchain are IMHO wrong, and there’s stunningly clear evidence of that in the DAO adventure. But I recognise that if you’ve made up your mind on that, and Governance isn’t part of your religious beliefs, that’s fine. You can stop reading and save your time & energy.

If not, then read on for Requirement #1 of a Principled Blockchain Governance... or if you're done with that, catch up on @dantheman's "How to create a meaningful Blockchain Constitution" and earlier post "Why every Blockchain needs a Constitution"

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"Those that are claiming [governance is] not necessary for e.g., blockchain are IMHO wrong"

Depends on exactly what you mean by governance. If you define governance as "Protection of the system from non-technical threats" then I think you'll find few willing to argue that all legitimate non-technical threats should be protected against, whether you call it governance or not.

I do find it interesting, however, that your example of why we need governance, Ethereum and the DAO, is an example of a technical threat (software bugs, and exploitation thereof) which probably needed less governance, not more, as the resolution was essentially the worst possible case scenario in consensus technologies: a permanent fork. Had they done nothing governance-y at all, the investors would have lost most of their money on a risky investment, which would have been exactly what they signed up for and agreed to when they signed the transactions that bought in, and all would've been well.

A better example, IMHO, of the need of governance in blockchain is Bitcoin. They have some serious need of solving of non-technical problems right now, haha

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Of course, in a high level discussion about humans, as it is with governance, it's hard to be precise about where the governance stops and where the tech starts. The way I try and do that is with the Principle outlined above - we automate what we can, then we govern the rest. E.g., good example of this is Bitcoin - the automation design solved the problem of double spending protection, so we no longer needed that central party to do that. But there was still "all the rest" to deal with. That's the domain of governance.

Then, of course, we can always accept a risk - as you describe it's entirely possible to say "code is law" and when the code hands it all over to an attacker, then the result is clear, you lost. But, saying it up front and expecting it to happen depends on humans behaving like computers. Humans aren't deterministic, they can happily say one thing and mean another... And so it happened. In terms of this article, Ethereum had a near-null governance layer at the start and then invented one on the fly when suddenly needed to satisfy the bulk of the "money". So, one can say the code was fine, leave it, but if people don't agree, then change happens. That's governance, and I'd argue it's bad governance and badly designed governance. We can do better.

@modprobe, i agree with you, and @iang

  • i'd add that it isn't really should there be a constitution or not, because "not" still implies how a group consitutes itself.
  • any design: governance model x, y, z, or "no" design at all is still a design choice. and by making this choice, you are already deciding governance.
  • org's, bodies, groups, systems, grow as a function of their design.
  • what at first may seem like chains of governance, may in the future be the means by which the system is preserved.
  • the question is what is it you wish to preserve, and if you hold it dearly, how do you ensure that you do that in a manner that befits the ideal.
  • consider this as analogy (lifted from a recent quanta magazine article): https://www.quantamagazine.org/how-heat-kills-cells

proteins seem as though they are rigid machines only able to perform one specific task, but they morph in times of need, so much, that it seems they are dying - instead they are fortifying and recombining in new ways to help their system grow.

the devil is in the details as much as in the lack of details (e.g. constitution vs no constitution).

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Fully agreed - and most blockchains have chosen "no consititution." And got into a mess because of it. One could also say that these experiments were just that - experiments to find out how far we can get without a constitution and what happens when something is needed. We can point to BIPs as examples of evolution in governance.

We can also design from the position of hindsight. And we can design to preserve the good while reducing the bad. That's what this series tries to do - hence the notion that we want a constitution that acts as a filtering device: "wot, you mean if I hack a contract and steal some money, it'll be clawed back? Nah, I'm going back to bitcoin where I can have more nefarious fun..."

Hello @iang, nice to see you here on steemit!
I'm in the camp you occupy on these issues, and I'm working through some of them on a project I'm on now.

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Always happy to read about similar projects :-)