Misunderstandings in the EOS governance debate
I have to admit that I’m a little bit disappointed with the quality of the EOS governance debate. Unfortunately, many people have some serious misunderstandings about the current system and how it is intended to function.
One set of arguments by ECAF-critics goes roughly like this: “ECAF’s mission is to protect private property. ECAF is not a ‘governmental body’, it operates on free markets.”
Ashe Oro’s recent blog post is a good example: Critiques of ECAF and the Growing Risk to Block Producers.
Unfortunately, this is a complete misunderstanding. It would be ok to say you want to change ECAF to function this way, but it’s not a proper definition of the current model. If we don’t have a proper understanding of the current situation, we can’t have any productive discussion about the potential changes we could do to make it better.
On the theoretical level, ECAF resembles a governmental body because it follows the similar path of decentralization of powers. Voters write the rules, ECAF makes decisions based on the rules, and BPs execute the rulings made by ECAF. This kind of separation of powers has been tested throughout the history many times and proven to work.
On the practical level, ECAF is more like a department inside of an organization. It was set up by the community to do a certain job for the community: to resolve disputes arising from the community’s rules, the constitution.
For the long-term ECAF is supposed to fund its work with the case fees. But it will take a while and during that time the service will be suboptimal. That’s why the community must decide is it OK to live with the suboptimal service or should we help ECAF to scale its operations faster by providing funding it from the Worker Proposal System?
We can also develop base-layer dispute resolution further by adding market mechanisms for better incentivizes. But that’s not an easy thing to do, contrary to what some free market fundamentalists might say. I would save that debate later. First we need to get everything running smoothly with one organization until we can start adding more complexity.
One of the articles in our current constitution defines property rights and dictates that it’s acceptable to do only voluntary transactions. Effectively it forbids stealing. For some reason, many ECAF-critics seem to think that this one article is basically the only reason why ECAF exists. But no, it’s just one rule among many others. If base-layer dispute resolution is removed from the system, then we lose all the other rules, too, not only the property rights.
It’s hard for me to see the logic in this. If you don’t like one particular law, it doesn’t make sense to demand getting rid of the whole justice system.
Official rules vs. mob rule vs. whale cartels
If we lose ECAF, then we lose the ability to enforce rules, so we basically lose all official rules. After that, rules are more like a wishlist how the community should behave. If we don’t have any real way to enforce the rules, they are not very meaningful.
Official rules are nice because they offer predictability for the platform. Users can be sure what the rules are, and if they don’t like them, there is an official way to change them. This reduces the number of harmful conflicts within the community.
If we don’t have official rules, we lose predictability. Nobody can be sure what the rules are in the near future because it depends what the latest FUD and hype are at that moment. That’s called mob rule. Another possibility is cartel forming. When there are no rules to forbid buying and selling votes, that is what’s going to happen for sure.
Originally Dan Larimer supported officially governed blockchain. You can read his earlier thoughts from two posts: How to create a meaningful Blockchain Constitution and What could a blockchain Constitution look like?
When EOS was launched, there was a huge shitstorm because nobody understood the system. That made Dan change his mind. But he was wrong. He thought that ECAF can’t resist the mob so the system would become ruled by the mob. But so far the evidence is the opposite. ECAF has remained independent and resisted very well all kinds of outside pressure — and there really has been a lot of pressure. It was designed to be an independent institution which is outside the direct control of the mob and the whales. So far this design has proven to work.
What happens if we remove ECAF? What happens to all the pressure by mobs? I have a bad feeling that it will be directed at BPs and they can’t resist it as well as ECAF has been able to because BPs need votes. BPs need to please the mobs if they want to be elected.
Or it might be that the most vocal people don’t actually have a lot of staked tokens, so BPs don’t need to care about them. But they need to care about whales, which can become a problem if the whales decide to abuse that power.
We have to identify the right market
So far everyone is talking about markets in the context of ECAF. But at this point, it really doesn’t operate on a market economy. It has a monopoly on a very limited part of the ecosystem.
The markets everyone should care about are the general cryptocurrency, blockchain and fintech markets. Those are the markets where EOS operates. That should be the focus of our efforts.
EOS is comparable to a (semi)private organization which produces services to its members. When potential new members think if they should start using EOS or not, they look at how well EOS serves its current members. From this perspective, EOS members are more like customers of a company.
The ideal situation is when current members really like the service EOS provides to them and happily recommend it to everyone else. Then we know we can succeed against all other blockchains.
We must also not forget that EOS is designed to serve larger mainstream markets. There have been lately a lot of vocal arguments favoring EOS to be changed to be like traditional blockchains. But those markets are already saturated, there are a ton of other chains competing for the same set of customers.
Having an official, clear and predictable ruleset for the ecosystem is essential if we want to be friendly for mainstream business.
Just look at the recent drama with Bitcoin Cash. Two competing camps willing to use whatever dirty tricks they can in order to force their ideas to be adopted. That’s what happens when a project doesn’t have a proper mechanism to make collective decisions.
Do you think mainstream businesses want to use a platform which is run like that? No, they won’t. They want a platform that can keep everything together and running smootly even at the times of big debates and disagreements.
