Ping-Pong Governance: Token Locking for Enabling Blockchain Self-governance

Paul Merrill, Thomas H. Austin (), Justin Rietz () and Jon Pearce
Additional contact information
Paul Merrill: 0Chain LLC
Thomas H. Austin: 0Chain LLC
Jon Pearce: San José State University

A chapter in Mathematical Research for Blockchain Economy, 2020, pp 13-29 from Springer

Abstract: Abstract Updating blockchain-based protocols remains a significant challenge. If the community does not come to an agreement, a hard-fork can occur, splitting the blockchain’s community. Previous protocols have provided mechanisms to establish community consensus through the protocol itself, but these protocols either facilitate substantial, infrequent updates, or they allow more frequent but only minor changes. This work offers a mechanism that allows clients to vote by locking tokens, making the clients’ tokens temporarily unavailable in exchange for their vote. This design introduces an economic cost to voting, allowing us to measure both breadth and depth of support. Since there is an economic cost to voting, we wish to make non-contentious issues cheap to pass, but still allow the community to establish agreement on larger, more disputatious proposals. We achieve this property by a ping-pong governance model. An issue is tentatively accepted when it achieves enough votes within a fixed period. The proposal then enters a review period, where the opponents must gather enough votes to veto it. The supporters then have their own opportunity to overrule the veto. This process continues with new voting rounds until one side is unable to exceed the needed threshold, settling the issue. Our simulations show that this model allows the community to come to agreement quickly on popular changes, but still come to resolution when the community is more divided. Finally, we define the ideal properties of a blockchain governance protocol, and evaluate different governance protocols under these criteria.

Keywords: Cryptocurrencies; Governance; Token economics (search for similar items in EconPapers)
Date: 2020
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-3-030-37110-4_2

Ordering information: This item can be ordered from
http://www.springer.com/9783030371104

DOI: 10.1007/978-3-030-37110-4_2

Access Statistics for this chapter

More chapters in Springer Proceedings in Business and Economics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().