Discuss rebranding here! Rebranding Brainstorming for Zcoin
It’s not a bad allocation. 20% seems too low.
60 to miners
30 to znode
10 to treasury
10 doesn’t solely go to developers. The amount of that 10% is voted to be salary for developers.
The community could also use that 10% for other activities. But developers should get voted first or get priority over other proposals.
I have started looking at quadratic voting (QV).
- A voter is able to express how strongly they feel about a certain decision by buying and applying more votes to their desired position.
- Voters can vote as many times as they want, but they are assigned a set number of voting tokens over a certain period of time and the cost of each vote/token increases in a nonlinear way.
- In turn, quadratic voting takes advantage of the fact that the stronger someone feels about a certain position, they more they will be willing to allocate more of their votes to that position. In terms of why quadratic voting is “quadratic,” Vitalik explains in his article On Radical Markets, the voting is “quadratic” because the total amount you pay for N votes goes up proportionately to N².
Instead of pure yes/no votes or simple majority voting which has many flaws such as tyranny of the majority, quadratic voting allows voters to express the weightage of preference. Also putting in a strong vote for one outcome increases the cost of voting.
The main challenge with implementing quadratic voting in Zcoin is the requirement to separate out ‘identities’. With a privacy focus, this is very difficult unless we enable KYC which I think goes against the spirit of Zcoin.
See how Eximchain implements it, which won’t work for us cause of the KYC requirement.
So perhaps not adopting QV fully but there are some interesting things to consider:
- Voting should have a cost. (this means big stakeholders have a say but have to spend to vote)
- However the costs of this can be refunded and redistributed over those who vote (incentivizing voting despite the cost)
- Weightage of preference
What are some thoughts on structures like these?
So they have Dash Core Group (DCG), is a c-corporation, business etc. So it’s for profit.
Then they have a Dash DAO Irrevocable Trust
The Trust is in favour of the Dash masternode holders.
Dash Trust owns 100% of DCG and therefore controls its board of directors.
So basically the Trust represents the masternode holders and can change management of the DCG while retaining its talent, coders etc
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.
I’ll be the devils advocate here and argue for master node voting. Similar to Dash.
They have a lot of zcoin invested, therefore they have the most to lose if bad decisions are made. Yes, “whales” will be the decision makers, but they have invested their own hard earned money into this project, so they have earned the right to vote in my opinion.
I would be okay if this if not for the founders having kept many of their rewards (which is good) but bad for masternode governance.
Note that they got their founder’s wallet for a lot less for their seed investment.
I’m glad you’re struggling with the governance issue … that means you’re taking it seriously.
It’s a very complex situation and needs to be resolved properly … and it’s not clear to most of us how it should be setup.
Personally I think decisions need to be made by a team that is either appointed and/or voted into their positions - and they need to be accountable for their decisions,
but at the same time have public voting on all major issues with full disclosure of voting results, and an explanation of the decisions the team makes based on the votes.
In theory, the team can know much more about some issues than anyone else, and may decide to go with less-than-popular options on some issues, because of strategic or security concerns that may influence decisions and may not be able to come to light until after implementation of some features
(the great handling of the ‘coins-from-thin-air’ hack is one good example - quick resolution - then public announcement later).
If people are not happy with decisions being made by the team, then there would need to be a process in place to vote on who is on the team, and they can be voted out at an appropriate time.
It’s still not clear to me how to setup the voting process for the team or the major issues - it wouldn’t necessarily need to be block-chain based.
While Quadratic Voting looks very intriguing, it could end up being too complex, and could let bigger fish have even more influence on a vote than using other methods.
Registering to vote likely wouldn’t sit too well for people owning a privacy coin (including myself) so another method needs to be found.
Using voting tokens may be possible (like an air-drop) - but that may get complex and messy - and doesn’t fix the big fish issues.
Maybe something like one-wallet-one-vote (with wallets needing a minimum balance of - say - 500 xzc to be eligible to vote)
- and it would be based on minimum balance for the voting period - this would prevent people from moving Zcoins from one wallet to another to get more votes.
- not sure how that would work for people with Zcoins in exchanges, or Coinomi, or other non-Zcoin-core wallets,
or people trying to influence voting by setting up more wallets just to vote … not clear how to fix that …
Allowing Znodes to vote as well as wallet holders would be double-counting since the wallets already contain the 1000 xzc.
I think the best way may be one-Zcoin-one-vote. Each person who owns Zcoin in a wallet casts a vote pro-rated based on their percentage of the total circulating supply.
Say - 1000 xzc which would be 1000/7,640,000 = 0.01309% of the total vote - but again - the big fish issues aren’t solved (and maybe can’t or maybe shouldn’t be?) … not sure.
If there are concerns about the founder’s rewards being in a different class (and maybe they shouldn’t be allowed to vote?) what can be done to make it fair to the rest of us who have worked hard either mining our coins or buying or trading other coins for Zcoins?
Can the wallets of the founders be excluded from voting (or given a different weight in the vote), or do they just transfer their coins to new wallets to get around the voting issues?
… again … not sure…
If the final say goes to the team (who will be held accountable) maybe the voting doesn’t need to be as strict, and a one-Zcoin-one-vote approach would work well enough
- possibly with break-out stats for votes by groups (Znode holders, general wallet holders, founder’s wallets, etc.).
Just some thoughts … hope it helps …
Really nice post Zed!
So speaking to a lawyer and the recent classification of securities there are some major issues that we need to consider.Giving voting rights to zcoin holders to allocate funds can be deemed as creating a ‘common enterprise’ and centralizing the efforts to increase the value of Zcoin and be deemed a security. It is effectively directing capital to rely on the effort of others. This gives a problem to projects like Dash or Decred and in fact Decred was taken off Poloniex’s US site.
I’m still trying to think of how we can get around this.
Is there a legal distinction between voting and polling? … I’d be fine with the team asking for input with just a poll, and then being held accountable for the decisions they make.
yes polling is merely indication of interest while voting has binding consequences.
If we give a % of rewards to the developers. Are you guys also going to be responsible for everything in development of zcoin?
I’m talking about not just marketing and developer salary. For example dash community has their news team, Venezuela team, YouTube team. All done by the community based on proposals and votes of course. I think dev team will have their hands tied with developing and marketing. We need more community involvement and involvements needs to be funded.
Maybe we can dedicate a % to dev fund but also a voting mechanism for other developments. If voting per se is bad for legal reasons, then let’s pick another way to obtain consensus like polling. Or sending a small amount of zcoin to polling address.
Zcoin is not a nation so don’t really need a over complex governing system.
That’s an excellent point. I think one way is to have a community fund where we contribute some of our spare dev fund to a public address and people can apply to utilize it for grants.
On a side note, I was thinking if we were to have a development fund of 10% of block reward (which should be less than what we get now since it’s 6% of pre halving figure), until Dec 2021 while we decide the best way to do this.
55/30/15. No dev funds means no future