Thread by @lkngtn

@lrettig Might be too nuanced for twitter but I will try!

Blockchain governance is fundamentally different than state governance. So while it's easy to equate coin voting with decisions by the wealthy... the dynamics are actually very different.

@lrettig In a state, the primary factor determining how much a given policy impacts you is your location. And since you cannot be located in two places at once, there is a strong association between your citizenship/residency and the rights you are granted.

@lrettig Unlike a state, blockchains enable you to be a constituent/stakeholder/user of many chains simultaneously. And how much you hold of a given asset is the primary factory in determining how much impact a policy would have on you.

@lrettig Democratic governance (1p1v or quadratic) does a poor job of distributing rights based on a users actual interest in a blockchain community.

@lrettig By failing to represent interests of the community by distributing governance rights too broadly, the community becomes even more vulnerable to capture and sabotage by external/competing communities.

@lrettig Coinvoting represents a straightforward way of defining the degree of interest a user has in a system. A users portfolio represents their interest across various different potentially competive communities.

It may not be ideal, but its far from simply the rich make decisions.

@lrettig The crux is that for blockchain governance we need some way to allocate rights in degrees of interest. It is coin-voting is based on a portion of ones wealth, but not simply ones total wealth.

It is a signal that carries valuable information that is impossible to fake or game.

@lrettig Even if we assume a maximalist perspective, and that there will ultimately only be one big winner the ability to fork and redistribute wealth in the process makes policies which exacerbate wealth inequality incredibly risky.

@lrettig Wealth inequality is a real issue and tends to break governance processes (even formal democracies!) and perhaps in the future chain which distributes wealth to individuals as some sort of Crypto UBI will become popular!

@lrettig I would treat formalization of stakeholders and distribution of wealth as two separate but related issues.