Blockchain Governance: Delegate
Hi frens,
If you’re coming from Ethereum.org writers cohort, welcome! I started this weekly letter from the first writers cohort, and here’s my second take.
In a democratic society, we often vote our own representatives, ex. legislators. Those elected people make decisions on behalf of citizens. That’s governance in the real life.
Similar scenario happens on companies, where board of directions are elected by shareholders, overseeing the management of the company.
On blockchain, we like to talk about decentralization. Do we have decentralized governance? Sure! There are some blockchains communities, experimenting with different mechanisms.
Let’s talk about two examples:
OP Mainnet (previously Optimism)
The governance token is $OP, and holders are responsible for submitting, deliberating, and voting on various types of governance proposals.
Every $OP holder can “delegate” token here for any single wallet address, i.e. representative. All $OP token voting power on the wallet will be delegated to the representative, even if you’ve transferred more $OP into the wallet. Pretty convenient, right?
It’s totally transparent. The proposals, voting, delegate powers, discussions, anything.
And you can vote any proposal by yourself (delegate to yourself), at any time! That’s perfect mechanism of combining representative and direct democracy, isn’t it?
One final note: if you stake $OP elsewhere to earn rewards (similar to making a deposit in a bank to earn interest), those $OP would not carry voting power.
Cosmos LikeCoin
I began my crypto journey in the Matters.town community. LikeCoin, based on Cosmos ecosystem, has been the main cryptocurrency there.
On the OP Mainnet, ETH pays for gas, $OP handles governance. With LikeCoin, it's all in one: it pays for gas and handles governance. LikeCoin holders can delegate tokens to validators and earn rewards at the same time. Think of a validator like a legislator and a banker combined!
That sounds promising for incentives, but I'm concerned about having legislators also act as bankers. What are your thoughts on this?
Your friend,
Denken