Non-linear voting power for GOV voting

Should voting power be linear to the amount of tokens held?

I have been thinking about this topic for a while now, and a discussion has just happened on Telegram about said topic.

When we look at established democratic societies 1 identity will get 1 voting ballot.
In DeFi you get 1 voting ballot per 1 GOV token owned. In Pylon’s case this means that some wallets (as can be seen here: Biggest Mine wallets) controls up to ~13% of the available voting power. I am expecting that the same can be said for most other protocols in Terra, though I have not dug into the data.

Imagine if our society was build around “wealth = number of voting ballots”. This would create a highly skewed and probably defunct democracy. I believe we are at risk of achieving the same here, in the DeFi space. Also look at what happened with $TIME and Wonderland. A few whales almost won the vote to shut down and pay out. Anyway, back on topic…

This discussion is therefore:
Can we do something about this in the DeFi space, starting here in Pylon.

An aggressive version would be “1 wallet = 1 voting ballot”.
How do we then combat wallet splitting?

  1. You must have staked for min 1 month to be able to vote
  2. Your wallet must contain at least X tokens - could be 1k, 5k ,10k. To be decided
  3. Track wallet movements, it should be possible to see wallet splits if tokens are moved. There are ways to game this obviously, but some things can be detected.

There could be other variations of this like log2(mine_staked) or other “reductions of power” that can be applied, to level the voting field.

How does the community feel about this?

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Just dropping in to say that we discussed about this in the telegram chat and completely agree with it.

it is a bit complex as topic. Depends from projects imho. Not having a voting power related to the amount owned is bad for the value of the token itself.
Eventually airdrops could be handled in a more democratic way, but i am not convinced a priori.
If a project aims to have massive partecipation could be ok to handle airdrops privileging the ‘number’ over the wealth with a linear token release to avoid dumping and attract people.
So my position as first feedback is: airdrops open to parametrization based on project needs, governance and voting power should not introduce whales penalties. What projects can do is introducing a veto power to avoid whales takeovers: also this has to be discussed a bit in case.

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Seems risky to devalue the owning more tokens but we did see an example this week in Pylon voting.

I’m wondering if it might be possible to develop an automated system of calibration that adjusts quorum and required percentage to win a vote according to the size of wallets voting. The idea would be to create a pass line that is always a bit beyond the reach of a statistically outsized dominance of a minority.

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That is also an idea worth investigating, the fixed quorum have also struck me as odd :+1:

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I’m not seeking to devaluate airdrops and all other benefits. Those should stay linear to GOV tokens held.

I’m merely asking / addressing the voting power of such tokens for the governance votes.

I have understood. I would eventually privilege the opposite. Governance has to reflect ownership. Competence is normally rewarded and brings competent people to own more and then exercise more power in governance. I would never invest in anything where number of votes is the criterion to decide. That can happen in a restricted dao only and is also risky asmajority stakeholders could be isolated by hidden agendas and political games.

I completely agree with your point. I think voting power should/could be proportional to the time one has been staking. This shows dedication to the project and avoids whales buying up a lot of tokens last minute just to manipulate the vote. Other criteria could also be added of course

actually the time component could make sense too. 1 dimension is looking backwards to assign a score which is a good solution.
Another is : locking MINE for long time example 3 months, 6 months 1 year to boost voting power or even burning mine to create an untradeable vmine which has high voting power.

It’s a valiant effort but the thing with governance is that it won’t ever be fair to everyone, ideally (imo) you’d want to reward participation, those that use the protocol the most would have the most power, but tokens can be bought so you reward wealth instead, lockups have been created (vTokens and vxTokens) to reward commitment in voters but even that has been bypassed, protocols have been create to hold lockup tokens from other protocols and become liquid derivates (see the curve wars). Quadratic votes try to solve the whale issue but give more power to those least vested in the success of the protocol, not ideal.

Some solutions are better than others, but I don’t believe he’ll ever reach one that we’re truly happy with, and maybe that’s okay.

I have an even less popular opinion right now, most governance is useless, it’s a rubber stamp… most people will vote with the team on nearly everything, the team invests the time and capital to do development before a vote comes up, so it’s a formality and I’m okay with that. In an hyper growth phase, governance slows everything down and most won’t ever be bothered to be informed before voting.

At the end of the day we’re investing in the team as much as we do in the protocol.

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Yessssssss!!! love that this topic has come up.

As @paletas pointed out, there is no perfect governance model and there are tradeoffs that need to be made to meet the needs of a specific community.

Here are some of the issues I am aware of that Defi governance faces.

1 - Voter apathy (governance stakers not voting).
2 - Whale dominance.
3 - Information/demand saturation (more and more projects are using governance tokens, each requiring significant time & effort to vote accordingly, thus pushing voters beyond their information/time thresholds).
4 - Social engineering.
5 - Purchasing large amounts of tokens for a specific governance attack.
6 - Needing a vote to go through urgently (potentially risk and issue that needs fixing ASAP).

Here are some of the potential solutions I am aware of.

1 - i) Having people delegate their governance tokens. ii) Having elected community or team representatives provide TL;DR on the votes and potentially indicate how they would vote.
2 - Quadrantic voting (voting power = square root of tokens).
3 - i) Having people delegate their governance tokens. ii) Having elected community or team representatives provide TL;DR on the proposals and potentially indicate how they would vote.
4 - Services like https://www.bribe.xyz/ where voting power can be paid for. That said, this also presents a risk.
5 - same as 4 and also something like having to stake 1 month before being able to vote.
6 - Having another voting mechanism for creating instantly passed votes. For example, “Instant” proposals require => $100K UST worth of the governance token locked by the proposer/s (can be one person or multiple that make up the $100k), those tokens are locked for 1 or more months, and the vote might require 90% majority to pass.

For Pylon, I am on the side of removing linear voting and replacing it with quadratic voting. On top of that, I also think it would be good to have elected community or team representatives provide TL;DR on the proposals and potentially indicate how they would vote, a staking requirement of 1 month before being able to vote, and having another voting mechanism for creating instantly passed votes (like the example provided).

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This is certainly an interesting concept. I think it would be good to reduce the influence of whale wallets, but they also shouldn’t be reduced to 1 vote per wallet.

Maybe something simple like the top 10 wallets have a reduced voting power by 10% Based off the current top 10 wallets that would reduce their voting power by 12,186,208 votes.

Or if you reduce the top 20 wallets by 10% that’s 14,350,830 votes

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“Imagine if our society was build around “wealth = number of voting ballots”.” – Sounds like a horror story where the wealthy wield disproportionate legislative power. Thankfully, the cours wouldn’t allow corporations to throw their money around to buy votes… Oh, wait.

In all seriousness, @laine_ust, I agree. Control-by-wealth is far from the original democratizing crypto ethos.

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Thanks everyone for pitching in. A lot of good views and points here.

Not sure where we go from here. There seems to be consensus around the fact that it could be better, but also consensus around the fact that nothing is perfect and it’s all broken anyway XD

I was thinking of trying out the dfferent functions on already passed votes to visualise how they may or may not have played out differently.

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