The governance model of Bitcoin is falling apart not because of the people involved, but because there are people involved, and human governance as we have it today has it’s limits.

In the past few millenniums we, humanity as a whole, have experimented with various governance models, some became useful in certain use cases, others proved unstable and would collapse after a short while only to begin the cycle again.

As a species we evolved because of our ability to imagine and visualize the consequences of our actions and the ability to transfers information learned from one individual to another individual (or group) without requiring us to relearn the same information going through the same processes that led to the conclusion. Our empathy is the key to our ability to transmit and receive such information.

As long as we are huddled in a small group where individuals all know (and possibly trust) each other, reaching consensus is relatively easy, even when there are disagreements they’re re relatively simple to resolve since the numbers of supporters / opposers are “manageable” and each can be persuaded individually and either help reach a common ground or evolve the discussion further considering the new information as it becomes available.

This worked well for our society when we were in small groups, but as soon as we began to form larger groups, such as towns, cities, city states, and eventually countries and unions of countries, these tasks were performed by either a dictator of some sorts that would himself consider all the facts or a government that is essentially a committee chosen by the people to represent them to do just that — reach consensus .

Without going into the subject of our failing democratic-capitalistic governance models as we know them today, I argue that this situation will eventually become a problem whenever a large group of people needs to reach consensus — most individuals involved in reaching a decision cannot reach said decision because their ability to learn the subject is somewhat limited (at best case scenarios), many subjects, such as the subject of increasing the block size limit in the bitcoin network appear simple on the surface — “Increase the block size — just make it 8mb instead of the current 1mb limit” — but their implications could be devastating if implemented incorrectly, and for us to be able to reach a scholarly decision we’ll need to learn the subject day and night and eventually run tests and simulations to verify our hypothesis.

This situation, where a question seems to be simple but in fact is far from it, is the situation we face daily in almost every governance model you can think of, and such is the case with the most recent bitcoin governance crisis. Eventually most of the participating parties in the debate have their own agendas, even if the agenda is the common good the perspective of each party varies and influences their decision making and the final verdict we all reach.

In the process we are also influenced by popular and unpopular opinions, and some of these reach popularity or notoriety not because of their intrinsic value or truthiness, but because they are spearheaded by more popular or less popular individuals, some have a higher ability to spread ideas, others are more subtle about their opinions. This creates an imbalance that we currently have a hard time to resolve, in some cases causing us eventually to either stop evolving the idea altogether (stagnation) or reach the wrong conclusions and hence act in such a way that will eventually harm us in a way we didn’t predict or predict but decided that it’s not a viable future.

To remedy this situation we need to come up with a better way to reach consensus amongst us. Reaching a consensus on a protocol like Bitcoin it has been shown to us that it is indeed possible provided we have the proper mechanisms in place, so reaching a consensus among people that don’t have a specific protocol for reaching a consensus must be possibility provided we have the proper mechanism to help us reach it in a way we all agree on.

I believe that this mechanism was already invented, although has yet to be properly implemented, and in order to resolve this situation that we have reached with the Bitcoin network in such a way that all the involved parties (i.e. all bitcoin users, miners, developers, core developers, and businesses) we have to implement this new mechanism, otherwise we might not reach consensus and eventually we will all hurt the network although we all have best intentions.

The mechanism in question is Liquid Democracy, or in its other name Delegative Democracy. The reason this mechanism is far superior to other existing mechanism is because of its ability to delegate our individual power to individuals that we know and trust that can reach a scholarly decision, that are investing the time and resources required into learning the subject to very fine details.

With delegative democracy we combine our numbers as individuals in to a mass or a group that is not swayed by opinion or publicity stunts but rather steered by those who have the knowledge and will to lead us. With delegative democracy we can reach consensus on fine details as well as general direction, we can verify that those we chose to delegate our votes to are indeed operating as we expect them to and eventually learn from each decision on a fine grained level and encompass them into a larger agenda that we all can support, even if we disagree in some opinions.

In a delegative democracy we ‘vote’ on every little detail that needs to be decided, but most of the participants need not to be bothered by actually voting, but instead they delegate their vote, or rather its value, or weight, to a delegate that they feel could reach a better conclusion on a per subject basis. Our delegates get our voting power unknowingly and hence cannot sell or buy their vote in advance, or prove its value in hindsight since all the votes are photographically authenticated but anonymous making it impossible to rig votes to certain side.

Using delegative democracy we can reach large scale consensus while debating every fine detail without the agony of committees and their ineffectiveness — everything in a delegative democracy is open for public review, and we as voters can change our delegates at any time if we recognize a better option or delegate that suits our views.

Delegative democracy isn’t out of reach, it’s a rather simple system, far simpler than Bitcoin or Facebook for that matter, and can be built over the period of 6–12 months by a small number of capable developers.

I believe that we must build such a system, initially to resolve governance problems in projects like Bitcoin, and eventually expand this model to full governance replacing our existing representative democracy models if it proves successful.

Bitcoin has grown beyond the size where a small group of people can, or should, lead the project, but our current mechanisms are not resolving this situation, we must act now to find the most viable solution to the various problems Bitcoin is facing and going to face or we might end up with a bitcoin that is not as decentralized as we all hope it to be, or even worse situation where bitcoin ceases to function due to bad decision making.


If you, like me, see that the current situation is dangerous and we should advance carefully rather than follow one popular name or another, please share this post or write your own so that this idea spreads further and eventually gets built into a real solution. Our alternatives are to anoit a high priest, or benevolent dictator, to lead and make all decisions, or fall back to endless and mostly fruitless committees.

Vires in Numeris