The more I read and research, the stronger I feel against on-chain governance.
The following will be controversial so I hope community members can weigh in on this. This is more of a brain blurb rather than a concrete proposal but wanted to put it down here.
If masternodes vote, it will be whales dictating how funds are allocated, making it fake governance though arguably they are the ones that will act the most rational given their large stakes and more likely to be long term holders.
Miners in an ASIC resistant type of algorithm, are fickle and do not have any loyalty since there is no incentive locking them in. This is the cost of commodity hardware mining.
Zcoin holders you would think would make sense but then again as they can both buy and sell coins in the short term, they can be minded to vote in short term pump strategies that hurt us in the long run.
As much ‘democracy’ is seen as a ‘universal good’, it really isn’t and as we are seeing increasingly in this world today, is often turns to mob rule and governments winning due to populist policies (even if not the best way to do things).
The video below illustrates this.
I also am not sure how prudent it is to leave every decision to the community and more in favour of having an executive being voted in and out of fixed terms similarly to a company structure so that if an executive doesn’t carry out his duties well, he will be held accountable and removed. Transparency reports of course have to be given and some checks and balances in place.
One of Poramin’s concerns is the risk of having a more ‘executive structure’ is that it forms a target to shut down or to be forced to insert backdoors. This is partially off set by the fact that all our work is open sourced but it is a valid risk if we believe Zcoin to become a leading cryptocurrency. This is also why we don’t really have a CEO due to Poramin’s views on this.
Yet the crypto community has often idealism in having decentralized funding when in reality, this type of funding model often opens itself to outside influence or will result in poor incentives for it to be worked on. For e.g. how decentralized is Bitcoin’s development? What do you think of Grin’s pure model that lead to it being contingent on donations?
I’m still in favour of funding development from the block reward since I think it is honest and aligns incentives in the right way as long as there is accountability. How to achieve this accountability with governance is the true question and whether it will be done on-chain or through other structures such as having an independently appointed foundation separate from the development and executive portions.