ichthyoid

This one might get a little controversial, but hear me out.

I was just reading this article on Blockonomi which talks about the evolution of MakerDao's Dai, and its political implications. It's a pretty good article, and I definitely recommend reading through it, but the basic gist is that, because of Dai's governance and voting protocols, if it gains enough popularity, it's inevitable that there will be pseudo-political factions that begin to take up and represent different issues or desires which people want to be implemented on the blockchain.

MakerDao's blockchain protocol isn't the only one which has voting features. Crypto projects like EOS and Tezos, both of which are gaining more support, also have voting features in them. It's a fascinating trend in decentralized technology, allowing more and more public input from those invested in the projects, not just a company behind it.

But a pure democratic approach to coding isn't always the best. And this is where I argue (perhaps un-popularly) that any blockchain or cryptocurrency developer should take a hard look at the United States' political system, and the lessons that can be learned from it.

What's So Special about the US Political System?

Now, when I refer to the US political system, I'm not talking about what's popularly presented by mainstream media today. It seems there isn't much but ridicule and insults, partisan warmongering, and just plain hypocrisy on display coming from the legislators and heads of state these days. But rather than trying to assert whether one side is right over the other, instead, I'm talking about the concepts behind the US political system, why they are the way they are, and how it can inform the way voting systems could work in large-scale blockchain projects.

The US political system (at least at its founding) was based on the idea that a big, centralized government will always work to oppress its citizens. In this way, the US Constitution was set up with a Bill of Rights governing what the federal government could NOT do to its own citizens. In fact, the federal government is split into three different branches (executive, legislative, and judicial), each meant to be pitted against the others so that the governmental body of the United States would have to compete for the approval and delegated authority of its citizenry.

More importantly, at its root, the United States was not designed as a pure democracy, but a Constitutional Republic. In its legislative branch, members of Congress are divided into two houses (Representatives and Senators). Representatives are based on the number of citizens in a State, while there are always only two Senators per State. These houses are both responsible for legislation, but because their demographics are so radically different, it takes many layers of work and cooperation among competing parties in order to actually get something passed.

Furthermore, the President of the United States (and thus the majority of the executive branch) is voted in through an electoral college, rather than a popular vote. This electoral college is made up of representatives equaling the combined number of Senators and Representatives, plus 3 more from the nation's capital district, Washington, D.C. The executive branch is capable of vetoing the laws legislated by Congress, which then requires a 2/3rds supermajority of both the House and Senate in order to pass.

This separation of powers and republican democracy is meant to divide the government so that any law that is proposed would need to pass through several layers of competing parties AND branches to become a permanent part of national law.

Why is this Better than a Pure Democracy?

Some might ask why such a cumbersome system exists. To answer that, one must remember what I said earlier in this post. While the United States' founding fathers recognized a need for a federal government to protect what they had won, they were far more fearful of the encroachment of government upon its citizenry. In this way, they desired that the federal government would not just have a small majority of public support in order to enact what they wanted, but would be a proper representation of the people

A great example of this (whether you like him or not) is the election of Donald Trump as the 45th President of the United States. Famous in the mainstream media for having lost the popular vote, but won the electoral vote, Trump's election is actually proof that the United States political system works.

The competing candidate (Hillary Clinton) won the popular vote by about 3 million people. This may seem like quite a bit. However, if we look at maps representing how each district in the US voted, there is a clear majority favoring Donald Trump. So how did Clinton win the popular vote? If you look closely at the above map, she won primarily where there were large urban centers. So while the rest of the country preferred the Republican candidate, the concentration of population in large cities gave Clinton an upper hand in terms of pure numbers.

But no one, having seen the diversity of demographics in the United States, would conclude that major urban centers should decide the way of life for suburban and rural areas. In fact, the state of California is a prime example of this, as it has three massive urban centers which have time and again voted against the rights of the farmers and other rural folk who require basic things like water and power. Since different people of different walks of life have different needs and desires, it's important to understand that just because you have a majority of people who like you doesn't mean you should be able to decide what to do to those that don't. In Ben Franklin's wonderful words:

Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote.

A pure democracy has historically resulted in the mob of the majority destroying the rights of the minority. The United States' political system was (theoretically) designed to uphold the rights of all citizens, so that they could have a voice even when they are a minority.

How does this relate to Blockchain?

I believe what I wrote above is extremely relevant to blockchain development, especially the ones that aim to be decentralized applications that evolve through voting. As argued above, pure democratic voting, while sounding nice, doesn't always result in benefits for everyone. Additionally, just because an idea is more popular doesn't always mean it's objectively the best or greatest idea.

Most blockchain applications these days are running or advertised as a form of currency. Currency, or money, can be easily argued as one of the most fluid mediums which a person can use to amplify their desires or needs. In its original design, Bitcoin was meant to be a peer-to-peer network that could conduct global transactions trustlessly. It was made to combat the corrupt banking and financial institutions' practices which resulted in the global recession of 2007-2008. It was, in essence, meant to be a currency made “of the people, by the people, for the people.” DeFi, and I believe all decentralized applications, have this in mind. It has the chance to become one of the greatest technologies ever invented that could bring more freedom and liberty to the world where traditional governments and businesses have historically failed.

Of course, I am not saying that all the intricacies of the United States' political system should be adopted. Different systems require different rules and regulations. But it would be prudent to take a hard look at any blockchain's voting mechanism, and see whether its design is truly decentralized. As seen above, just because a vote is directly represented doesn't always mean that it truly represents what's necessary and what is best. How that decentralization then is executed will probably have to be iterated and experimented on as we go forward.

If the above premises are correct, then perhaps these are some principles we could learn from the US Political System:

1. Pure/direct majorities don't necessarily represent an entire population.
2. Mechanisms which are popular are not always the best for everyone.
3. Accurate representation is more effective than general majorities in understanding a population's desires.
4. Slow and steady iteration is better than quick and revolutionary change.
5. Competition and dissension are valued components in effective voting systems.

6. A separation of powers can breed competition where the best ideas come out ahead.

7. Checks and balances can keep a system from becoming too centralized.

Some of the ideas above do have some overlap, but I think overall, these principles can used to help create good governance systems that are truly decentralized.

Header Image courtesy of Pixabay.