Quadratic Voting for Polkadot Governance

Governance
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With OpenGov landing on Polkadot in a few days I’d like to take a step back and see where we actually want to go as an ecosystem. I’d like to make the case that OpenGov is a plutocracy and doesn’t fit the requirements of a desirable governance model for web3. I’d like to argue why quadratic voting would provide a healthier middle ground on the spectrum between plutocracy and one-person-one-vote democracy.

Governance should derive its authority from legitimate sources. PoS and token voting as in OpenGov are legitimate in the sense that those who have more to lose have more to say. In an unbounded and pure market the capital will accumulate at very few individuals. A global one person one vote democracy, on the other hand, would not be legitimate for Polkadot because it would give people a vote who don’t care about Polkadot, are not affected by its decisions and have nothing at stake.

Governance should encourage the active participation and inclusion of all individuals and groups affected by its decisions. This is where OpenGov will fail. On Kusama it became obvious that referenda are decided by very few individuals and that an assumed 95% of all votes casted are absolutely irrelevant (not knowing how many humans are behind those 95% - nor the other 5%). This will lead to resignation and a lack of representation of many people who are affected by governance decisions. Vote delegation and conviction voting may help ease the plutocracy a little bit. Delegation helps with meritocratic representation and conviction voting may help protect the interests of minorities. But I don’t believe that we can be satisfied with this.

Quadratic voting applies the square root to the weight of committed tokens used for voting per account and therefore reduces the effect of capital vs. personhood while still giving capital a strong (enough) voice. By adjusting the exponent, one could even to some extent tune the balance between one-person-one-vote and one token one vote.

Quadratic voting, however, can only work in sybil-resilient system. The following simple example shall show why this is the case (for simplicity, conviction is 1x):

Uncle Scrooge votes Aye with 25 DOT
4 other people vote Nay with 4 DOT

  • In token voting, it’s 25 vs 16, so it is an Aye
  • In one-person-one-vote it’s a 1 to 4, so it’s a Nay
  • In quadratic voting its sqrt(25) to 4 * sqrt(4) = 5 to 8, so it’s a Nay

Now, Uncle Scrooge is clever and distributes his funds evenly on 25 accounts

  • now it’s 25 * sqrt(1) vs 4 * sqrt(4) = 25 to 8, so it’s Aye

So, a sybil attack can change the outcome, given the same capital distribution

How can Polkadot governance become sybil-resilient?

  1. State issued ID’s could be used for KYC (i.e. as recently announced by KILT&deloitte)
  2. Biometric Identity based (I’m not gonna go there and argue elsewhere why this is the least desirable option)
  3. Social Graph based (i.e. BrightID)
  4. Pseudonym Parties (in-person, like Encointer or virtual)

For more details I recommend to read this amazing paper by Bryan Ford: Identity and Personhood in Digital Democracy: Evaluating Inclusion, Equality, Security, and Privacy in Pseudonym Parties and Other Proofs of Personhood

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2

At a high level, I am in pretty strong alignment with what you stated here @brenzi.

First, I want to call out that calling the current Polkadot governance system a “plutocracy” is not inaccurate, but perhaps too negative of a connotation. The simple truth is, as you mentioned, that we do not have an identity system on Polkadot (yet) that would facilitate systems like quadratic voting. So given everyone can be an anonymous and potentially malicious actor, the only voting system that makes sense is one which incentivizes token holders to make decisions which are beneficial to making their token value grow. Yes, if you have 1M DOT, you will have a significant weight on the outcome of votes, but you are also proportionately invested in the success of the network. This is exactly the kinds of systems which business are run on, where founders and high level leaders have voting shares and large amounts of stock in their companies, which keeps them invested in the success of their business.

Polkadot has even gone one step further here with conviction voting, which I haven’t really seen anywhere else. That is, a person can increase the power of their vote by locking their tokens for a longer period of time than a normal vote. So actually, a group of smaller passionate voters can have much more weight than an impassionate whale.

There really are no deep flaws with the current governance system from what I can see.

However, there are certainly a set of world problems that can be solved with alternative voting systems.

For example, if you are like me, you might believe that national election systems today are flawed. Especially in the USA where gerrymandering and other voting schemes attempt to twist the outcome of elections. I do believe that blockchain technology could act as one part of a solution to these problems. I also definitely agree that we should NOT vote for the next president of the USA weighted on how many tokens someone has. This kind of election is perfect for a 1:1 voting system based on a robust web3 identity system.

However, I don’t think it is right to assume all votes on the blockchain should be of one type.

Instead, we should be thinking hard about incentives and outcomes, and pair the voting systems appropriately. For example, I probably think runtime upgrades should remain in the control of the majority token holders. I think some technical decisions like increasing number of parachains should stay in control of a meritocracy like the fellowship and their internal ranking system. I think funding for local Polkadot events could use a quadratic voting system, so that there is increased chances of funds making their way outside of the main financial tech hubs, but also resistant to a simple sibyl attack. If we were to ever help national elections, we should do 1:1 voting.

I think quadratic voting is the right technical direction, but we should be careful about what tools we use to solve what problems.

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3

this is perhaps the line that best sums up the vacuum in pretty much all discussions / arguments about pretty much any topic in this ecosystem. in general most people see the status quo as it is, and then work forward from there, rather than asking if anything, other than the historic state is sacred…

For example crowdloans? They’re an incentive system, they produce an outcome. It delivered good outcomes in one dimension, but is that outcome the one we are now optimising for?

Venture capital creates an incentive system, that drives an outcome - is that the outcome the one we want?

@brenzi you are currently enduring with Encointer the challenge of explaining public / common goods to a bunch of people who really want number go up aka:

When we reduce to these binaries, we can see the heart of the problem.

  1. Public goods - not sexy, slow burn, R&D driven, experimental, loss-making, hard if not impossibe to assess ROI in the short and even medium term, but ultimately the foundation on what everything else is built.

  2. Private goods - 99.9% of the crypto industry, sexy, change the world stuff, dopamine hits, short term wins, startup culture, influencers, overnight fame, celebrity - generally this is the tip of the iceberg though, its just most people are not exposed to the work beneath the surface that made that overnight success work.

Public goods are upstream from free markets. It doesn’t work the other way around.

People have short memories - Bitcoin birthed this novel public infrastructure after decades of R&D by many unknown individuals and groups with no funding, and motivation being curiosity about a problem… intrinsic rather than extrinsic motivating factors.

The other dimension we can consider related to this is simply about understanding that what we have here is a continuum - public goods —> money making products.

Rather than flip flopping from voting system to voting system in search of the one ring to rule them all, we should develop an fully on-chain innovation process that covers the spectrum.

  • The treasury is good for some stuff, but not everything. That’s ok.
  • The burn is good for some stuff, but not everything. That’s ok.
  • Delegation works in some areas, but not others (it opens up lots of legal issues).

You can work through pretty much anything this way, with both primary and second order effects.

Lets get stuck right into the weeds, what kind of process do we want?

What does the ideal journey look like over a five year period (or even a decade) for an idea, a team and an initative?

The truth is, fostering an sustaining innovation culture is a subtle, and delicate thing.

Right now we have no such process, but we can figure one out together.

We just need to be clear what incentives we are working with, and what outcomes we want at each stage.

This will help square the circle of the competing demands of public and private incentives.

4

I’ll echo that I’m very much in agreement with Shawn on this. One-person-one-vote systems (loosely-termed “democratic”) that include the voice of “everyone” (define that?) equally are not typically associated with arriving at the best outcome, however that be measured (economic, technological, …).

However such systems have two major advantages over stake or merit-based voting schemes:

  1. All individuals feel equally heard and included. This mitigates the possibility of “revolt” in the case of a controversial decision.
  2. Enables and empowers a lot of “minor actors” in decisions, thus massively reduces the possibility of the targeting of individuals by malicious actors.

I can certainly imagine a number of governance primitives which could be adapted with the arrival of a pervasive, strong and private Sybil resistance scheme to better ensure the resilience of the network and realise a number of important services much closer to their ideals.

Quadratic voting may be an element of this, but I see it by no means as the most exciting thing should the problem of Sybil-resistance be cracked.

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