A few thoughts as an active observer of the Algorand ecosystem. The 1 ALGO = 1 VOTE has been heavily marketed by everyone on the Algorand side and is a nice feature that is obviously as fair as it can be - given that algos are seen as citizens of Algorand. Even with this simplest definition of voting, governance will already be really hard to keep fair in the long run because wealth distribution, as in any other asset, will end up being really bad and the rich will eventually collude.
We started governance in Q4 2021. Less than a year later, we’re proposing to move away from our fair governance model to something that nobody really knows what it will look like.
Registering with the Algorand foundation, providing some administrative Algorand accounts for the purposes of voting on behalf of their participants;
This suggests going from a trustless fair democratic process to one that introduces Algorand Foundation as a middle-man for an additional part of it. Will we have a person hired as the “Head of governance approval” on Algorand foundation approve the defi projects? Who will be this person and how much do they need for getting bribed? Governance voting today is trustless and verifiable, are we sure we want to open all the possible attack vectors and introduce a middle-man? This seems like a step in the opposite direction that blockchains usually take, blockchains are supposed to remove the trusted intermediaries. Governance on blockchain should be no different.
Maintaining daily TVL on Algorand of at least 10M Algo-equivalent, on average over the two-week signup window for the governance period. For the 4th governance period (3rd Qtr 2022), we will use the TVL amounts as reported on DefiLlama
The numbers here seem rather arbitrary. Why 10M and not 20M? What if the marketcap of the cryptocurrencies explodes to a couple of trillion dollars marketcap, do we have another vote to update this parameter? What happens when defilama is down or gets shut down indefinitely? What if they report false metrics to gain advantage in a vote?
I would honestly expect that any attempt at moving away from the 1 ALGO = 1 VOTE would come with a research paper backing up the game theory behind the new improvement proposal. I believe this was done in good faith, but this unfortunately doesn’t make the proposal any better. I know this will sound harsh, but if the governance is to survive and stay relevant, we as a community have to shut down all weak proposals. It’s the only way this scales in the long run and it gives immediate feedback to those making the proposals. I’d keep quiet if the proposal was for something rather irrelevant, but this is a proposal to make a drastic change to one of the core invariants of governance system (1algo = 1vote) accompanied with the level of description similar to reddit’s “trust me bro” comment. It sets a terribly low standard for the upcoming proposals for big changes. If this is not improved, it will inevitably end up complecting the system and will result in the usual “orbits upon orbits” method of fixing the mess created by previous proposals. Ethereum took that path and it did not turn out well for them in terms of maintainability of a system that makes sense.
I’m not saying the direction is necessarily bad, but the severity of the change should require a magnitude more serious take on it. We can’t push forward a change like this through a blog entry with 2 bulletpoints in a layman language. I do understand not all governors will be able to comprehend research, but that’s not an excuse to avoid showing that the path has solid grounds. A change like this requires a better specification. It’s better to not give anything to vote on than to give an option for an unknown path just to have something.
Given that 1 ALGO = 1 VOTE was heavily advertised, the fact that we’re willing to change it in 6 months after the governance started should be a big red flag for any serious investor. It may be good to have the system evolve over time, but to flip such crucial invariants like this in half a year makes the financial/governance system unpredictable, which can drive away investors.
I apologize in case the details were provided and I managed to miss them.