An idea to improve Governance on Hive
In a recent post, my friend @ph1102 asked whether there is voter apathy regarding DHF proposals and he suggested that there should be an incentive for people to use their votes. His post made me think about how we could make the whole governance on hive better.
What are the problems related to hive governance?
When I speak about governance, I mean mainly the two processes that make us vote on witnesses and on DHF proposals. In my opinion both processes are rather unfair and give too much power to big accounts. Let me explain.
Witness voting
Each hive user has 30 witness votes at his disposition to vote for the witnesses that he trusts to run the chain. On Hive there are only 40 whales that own more than 592'000 Hive power according to the stats published by @arcange. Together these 40 whales own 149 millions Hive Power or roughly 49% of all the staked hive in existence.
There are 20 core witnesses that are running the chain and these 20 witnesses get much more rewards than the following witnesses.
In my opinion the governance process to elect witnesses is flawed by the fact that we can vote on 30 witnesses and it's virtually impossible for a witness to get ranked in top 20 without the support of at least some whales.
Proposal voting
Everybody who has staked hive can vote for DHF proposals and his support will be indexed by the quantity of Hive Power that he owns. We have an unlimited amount of votes at our disposal. If we don't want proposals to be funded, we have the option to vote for the return proposal.
The problem that I see here is that again this process is under the whole control of the biggest stake holders. If the whales want it they can fund all the proposals. If they don't want any proposals to pass, they vote for the return proposal and things are more or less blocked.
You might say that whales have earned their stake and I totally agree with you that they should have a bigger influence on the proposals than others. But the problem I see is that whales are very few in number and can quickly take decisions and define who is funded and who is not.
Whales need to have more influence
I don't want to say that whales shouldn't have more influence than other users. I mean they have a lot of money in the chain and it's important that they have a say in who runs the chain and who gets funded. I just think that it would be good to have a system where whales can't leverage their hive power many times.
I thought about it and got some inspiration from other ecosystems and would like to present my idea here for a fairer governance process.
The concept
When voting for witnesses or for DHF proposals, we use our stake to actually define how the reward distribution is. The idea would be to say that each user can spread his HP only once. He has 100% voting power and can distribute his HP accordingly.
Let's take an example:
I have a stake of 30'000. Instead of being able to vote 30 times on witnesses, I could split my vote as I wish. I could vote 30% on witness 1. This vote would represent 30% of 30'000 HP, or 9'000 HP.
This means that I could split my 100% voting power the way I want over how many witnesses that I want. I could also just vote 100% for one single witness.
Now a Whale could split his votes the way he wants too. If he wants to vote 50 witnesses he could spread his power accordingly and give each a 2% vote. If he has 1 million hive power, this would mean that he votes with 20'000 HP on each witness.
For the witness ranking, the active HP voting for each witness would be calculated (HP x vote weight of the voters). The accumulated total would define the rank of each witness in the witness list.
Why would this be better?
If a whale can vote with 1 million hive power on 30 witnesses, it allows him to use his hive power 30 times.
Situation now:
Whale with 1 million HP votes on 30 witnesses- > he wields 30 million HP in the witness selection
Dolphin with 30'000 HP votes on 30 witnesses → he wields 900'000 HP in the witness selection
Difference 29'100'000 HP
With proposed system:
Whale wields a total of 1 million HP
Dolphin wields a total of 30'000 HP
Difference 970'000 HP
If the whale wants to vote on 30 witnesses, each of his vote would be worth 33'000 HP. If the dolphin wants to support only 1 witness his vote would be 30'000 HP. This could level the play field for smaller accounts and also encourage them to power up more hive.
With this idea, a whale still has much more influence than other users which is totally normal. However, he can use his stake only once rather than 30 times before and thereby just increasing the difference in terms of votes. In my opinion this would make the process fairer.
The same could be done for voting on DHF proposals. Each user could split his own HP in as many parts as he wants and vote on proposals or the return proposal. Again here, each user could leverage his HP only once and therefore the whole process would be considerably more balanced.
Example:
I have 30'000 HP and I want to vote as follows:
60% on proposal A – 18'000 HP would be voting for this proposal
30% on proposal B – 9'000 HP would be voting here
10% on return proposal – 3'000 HP would be voting to the return proposal
Like that I have used 100% of my voting power
All proposals that have received more HP votes form users than the return proposal get funded.
Incentives?
Another idea would be to provide incentives for voting on proposals and witnesses. There could be a DHF proposal that actually rewards people who use their voting activity. The same metric could be used to distribute the rewards. For each user, the Hive Power multiplied by the used voting power on proposals and witnesses could define the part of his reward. This would encourage people to get a more active role in governance.
Why change the hive governance?
From what I feel on the chain, there are a lot of people that are profoundly unhappy with how the DHF proposal system works. The proposals often lack form, control and follow up. With the present system, smaller users have little to no say to what is funded and what is not. The proposals are funded rather on the basis of social relations with whales, than on the merit of the proposals themselves. With the proposed system, I believe that whales would have a bit less weight in the process and the proposals would need to convince more people to get funded. In this case, I expect that there would be more social pressure to ensure a better form of the proposal and a close follow up of the projects. Proposals would need to please many not only a few selected ones and this would drive the requirements up in my opinion.
Let's not forget that the DHF has a direct impact on all stake holders. Every HBD distributed over the DHF dilutes the existing hive supply and we fund these proposals by inflating our assets. If a proposal is done well and brings real value to the chain, we would probably all want to support it. However, with the structure that we have now, the funding of the proposals is determined by very few people and in the long term this creates a rather toxic environment that I believe should be changed.
I would be interested in learning what you think about this idea? I hope it could lead to a discussion where we try to improve our system. It's a start...
With @ph1102, I'm running the @liotes project.
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I agree with all your suggestions for improvements to Hive governance.
I would also like to see some changes to login screens (and dashboards) to encourage more voting. But I think that your suggested changes to the voting process should be made first.
!BBH
At the moment it's just an idea and I think it's important that there is a discussion being started because the present situation isn't perfect and in my opinion it's bad for hive.
Just days after deciding to enter into the Hive portal, I really appreciate you providing this insight into some of the vitally important inner workings of the Hive blockchain.
Perhaps foolishly, but openly and honestly nonetheless, I do not mind saying the impressions left with me over the ~ year of reading various posts was the truth of this statement. Leading to a lot of reservations, on my part, about whether or not it would a good use of my time to begin writing ...
Well, the jury is still out I suppose, although all things considered, I decided to at least take the first step or two.
In the self-interest at the core of most human nature, resulting in them voting for each other to preserve their positions? No need to respond, as it seems self-evident.
Politics, in other words. Said differently, while the Hive blockchain itself may be innovative and new, human nature hasn't changed at all.
Your proposal to dilute the impact of those holding the largest stake seems like a very reasonable idea to me. I am equally clear it does not matter what I think, as it will be the same accounts you have cited above, that will determine whether or not this is even seriously considered. Let alone implemented.
Thanks for putting it out there! I will watch with great interest to see how the resulting discussion about it unfolds.
I think that this is the biggest hurdle to any changes but an understandable one. Nobody likes to give away things...
Interesting post!
I am not sure what should be done, but probably something. The voting percentage idea is neat, maybe something to implement to give more dynamic.
When I see new users getting stunned by the way the DHF works, I think it's true that we need to change something...
It's a good idea, the only problem I see is that the whales have no incentive to lose their power and I doubt they would support something like that.
I agree with you. I mean who wants to give up their privileges...
Makes perfect sense to have a 100% vote that gets divided between different validators instead of counting it 30x evenly which makes the gap between whales and others exponential.
Honestly, this entire witness voting and DHF is something I kind of neglect and skip as it just requires too much time. A way to simplify things and make everything more clear would be nice. Great idea!
Thanks for the feed-back. The fact is that smaller account have not much impact on these processes and for people who don't own several 100k of HP, it's almost not worth to bother with it.
To me, who has no idea about all the technologies being implemented in this blockchain—after all, I am just a blogger—this idea seems very fine. Of course, I do not know what the implications would be. But since the people who know the code read this post? Or not? Who knows?
And I'm interested in that:
If this were a project, say a DHF project, it would have to be implemented in the blockchain's core code. Or am I wrong? @blocktrades and other core developers probably know the answer.
Also, if it were a DHF project, you would immediately see who supports it and who does not.
But you can start very simply with a pool.
I don't know the technical side that well either. It would probably require a soft or a hard fork.
Soft fork could be good, probably better than hard...
Interesting thoughts - while I think whales have too much Power hence our chain is not really decentralized I think model for porposal voting is not that bad. Ideal scenario we get more whales by people power up but that might just be wishful thinking.
Thanks for taking time to add new approaches.
That's what a lot of smaller accounts try to do but they can never compensate the gap with the biggest accounts because just with curation rewards they accumulate a lot of hive...
exactly hence you need support by the big boys :-)
People are mixing things on HIVE very often... The difference between decentralization of the network and distribution of tokens... The later is an issue on HIVE, but you can't blame whales for being whales...
But, this:
... is an issue... And even if we close an eye on bad distribution... Leveraging that power is having even more power (30 votes, infinite votes on proposals)... and that is a bigger issue...
Not sure what is a good or bad solution, but we need more discussion about these things, that's for sure... On the other side, I'm not sure that we are ready to talk about decentralization if we are not willing to give away part of our powers... And we humans are very bad at doing that... 😂
Thanks for the mention!
The present system makes decisions about governance very centralised but as you said it might be difficult to induce a new system that would ask to give away power to the people who would need to implement it...
This would be a fairer and equitable system to implement. The math you show really emphasizes the huge advantage given to those with the largest stake at the advantage of the rest. Even though vote wise they don't control 100%, this amplifier effect gives them that. Huge governance fail on Hive.
It's a centralisation of the voting power around few people that makes the whole process less trustworthy and less reliable in my opinion.
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I think its a valid suggestion, but I have no idea whether or not it would work out. I do think that it does even out the playing field a bit, but I guess people would only vote for one or two proposals. I guess people will have to focus on what they support the most.
I think we could see much more proposals and divided support among the community. At the moment, it's impossible to get a proposal through without the support of the bigger whales.
I proposed exactly such witness voting years ago. I was right then, and you are right now. Guess why it didn't change? Because the whales want to be absolutely in charge of the witnesses. They are the man. The control what code the witnesses run. They control Hive.
When Steem began ~36 whales mined up commanding stakes to control the witnesses. Today ~36 whales have a commanding stake to control the witnesses, and witness voting 30x stake weighting is why.
Thanks!
I can understand that the whales want to make sure that the chain goes on the way they want but the present system leaves very little space to other ways of thinking and approaches. Which is bad for inovation and decentralisation in my opinion.
Yes, but innovation and decentralization aren't ROI, while cash is king.
In principle, I like your suggestions, even if too much decentralization can be too slow when quick decisions are necessary. Normally, I'd say this is unlikely to happen, since it's up to the whales to reduce their own influence, and that is a tough sell.
Exactly and without their support it will be impossible to implement changes.
Totally agree that something needs to happen to the overwhelming power of the whales. While I do agree that your influence should vary according to your HP (seen as investment in the chain, or maybe even better, the KE index!), as you correctly mention, these few whales have the power to simply control everything on the Hive blockchain.
I really like your proposals as well, been thinking about loopholes in it, but don't really see one at the moment, so that's good as well ;-)
Is there a way to propose this as a possible change?
!DIY
!HOPE
!PIZZA
!INDEED
!ALIVE
!BBH
I don't think that there is a process where such things could be entered but the best way is to try to get it out there through a post and sometimes on hive things catch up and evolve :-)
Yeah, that's what I thought already... And its not bad, but it may also let great ideas but little visibility die on the bottom of the pool...
Maybe that's another thing to propose, a proposal system ;-)
!DIY
!HOPE
!PIZZA
!INDEED
!ALIVE
!BBH
You can query your personal balance by
!DIYSTATS$PIZZA slices delivered:
@borniet(9/15) tipped @achim03
You can query your personal balance by
!DIYSTATSThis would encourage a wider variety of views from the entire community indeed! However, care must still be taken against bad actors who'll find any loophole they can to game any changes.
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