Why do we Tolerate Censorship in DeFi?

The Ether
The Ether
Nov 2, 2020 · 7 min read
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https://www.comparitech.com/blog/vpn-privacy/guide-to-online-censorship/

Do we really believe in censorship resistance and decentralization?

We are part of the Ethereum community because we believe in a more decentralized and censorship resistant world. We are sick of seeing the prevalence of conflicting interests in the traditional world hijacking the narrative, from outside influence in elections through the exploitation of social media companies to the banning of accounts based on their political affiliations.

Crypto is supposed to be a movement that embraces the ideals of censorship resistance and decentralization.

Why, then, are we satisfied with the centralization of governance forums and the censorship of dissenting ideas?

DeFi teams claim to be decentralized and pose themselves as giving power to the community rather than special interests. Why, time and time again, do we see the opposite occurring?

The conflicting interests of project run governance forums

Currently, Discourse has emerged as the platform of choice for governance discussions that relate to DeFi. Compound, Curve, Uniswap, and almost every other major DeFi project have Discourse forums for their community members to debate the most important issues their protocols face.

But what actually is Discourse?

Discourse is a forum management service backed by traditional Silicon Valley investment firms. Some of the backers of Discourse, such as SV Angels, are also prominent investors in DeFi projects, such as Uniswap.

Operators of these forums pay a subscription fee to Discourse in exchange for forum hosting. In exchange for the fee, operators have full control over their Discourse, including moderating and banning privileges.

In DeFi, most of the time, the project teams themselves are the operators of these Discourse forums, meaning that they have full moderation and banning control over the debates that take place.

Some DeFi projects, such as Compound, have Venture Capitalists who invested in the equity of their companies operate their Discourse forum.

Below, you will see a tweet from Niraj Pant, who is a General Partner at Polychain Capital.

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https://twitter.com/cjliu49/status/1283849367791656961?s=20

Calvin Liu is the Strategy Lead at Compound, while Polychain is one of the largest investors of Compound, and thus, because of the early investment, is one of the largest delegates in the Compound governance process. In fact, Polychain has the second most voting power out of any individual or entity, including Robert Leshner himself. They are an incredibly active participant in the Compound governance process as well, having voted on 10 proposals.

https://compound.finance/governance

In the case of Compound, my question is as follows: why do we embrace one of the largest delegates controlling the central governance forum where debates related to Compound governance primarily occur?

For the rest of DeFi, why do project teams control the governance forums themselves?

In both scenarios, I believe there is a distinct conflict of interest with the community at large. When teams control governance forums, they can censor the viewpoints of community members who might want to take governance in a different direction than the founding team.

Similarly, when one of the largest delegates controls the primary governance discussion forum, is that not a conflict of interest? If a contentious issue arises, will the delegate not seek to maximize their self interest by moderating the discussion on the governance forum to sway sentiment towards the way they want the vote to go?

Examples of Censorship Actually Occurring

Of course, there might be some who criticize this argument, saying that these DeFi teams and their investors would never revert to censorship as a solution. Yet there are examples of censorship already occurring. I am not talking about the constant blocking and banning on Discord, Twitter, and Telegram, but actual removal of community members/their posts from the governance forums and signaling tools themselves.

I want to tell you the story of SF, who submitted an off-chain governance proposal to both Curve’s Snapshot and Curve’s Discourse governance forum about the exact topic we are discussing today: censorship.

SF created a proposal titled “Stop Censorship & Embrace Transparency”. Here is what SF wrote in his proposal:

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https://twitter.com/98farhan94/status/1316085284602179584?s=20
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https://twitter.com/98farhan94/status/1316085284602179584?s=20

In addition to posting the proposal on the Curve Discourse Governance Forum and as a proposal on Curve’s Snapshot page, our friend SF also shared the proposal in Curve’s Telegram group:

https://twitter.com/98farhan94/status/1316085284602179584?s=20

The Curve team responded with overwhelming moderation force. SF saw that his forum account on Curve’s Discourse was deleted:

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https://twitter.com/98farhan94/status/1316085284602179584?s=20

Not only did Curve ban SF from their Governance Forum on Discourse, they also removed his proposal from Snapshot:

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https://twitter.com/98farhan94/status/1316085284602179584?s=20

While the proposal technically still exists on the IPFS backend, Curve Finance was able to remove the proposal from the UI since they control the front end of their Snapshot page.

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https://twitter.com/98farhan94/status/1316100576782950400

Curve has full control of what votes and proposals can be seen on their Snapshot UI.

Clearly, censorship does occur. The fact that these project teams not only control the governance forums, but also the voting mediums where people signal sentiment is a prime example of centralization.

What the Future Holds

If we continue to allow project teams and their investors to control both the governance forums and the primary governance signaling mediums, we can only expect more censorship and centralization of these platforms in the future as stakes continue to rise.

We need to have governance forums and signaling solutions that are not controlled by the project teams and their investors themselves. This control is no different than state-controlled media, and is exactly the type of thing we were trying to move away from when we joined crypto.

Our Solution

While we are not by any means saying we have the one solution to solve this problem, we do believe that The Ether is a terrific alternative to the existing governance forums that are controlled by the project teams themselves or their delegate investors.

We are not affiliated with any of the project teams nor do we have outside investors. We intend to hand over editorial and moderation power to our community based on the amount of XP they have earned, thus becoming the first truly decentralized and community driven forum application.

We have no conflicts of interest, and only care about increasing community agency in crypto governance processes and mitigating the power of centralized institutions/teams who want to maximize their self interest, regardless of if that interest is aligned with the community at large.

On The Ether, community members can debate governance changes of DeFi projects and signal what they are “for” and what they are “against”. In the process, community members earn reputation called XP, which can be used to display their expertise within a sub-industry of Ethereum, such as DeFi.

If there are others who also believe that governance forums and social signaling should not be controlled by the project teams and their delegate investors, we would love to talk. We are building a truly transparent, decentralized, and community first solution

One day, the governance processes of these supposedly decentralized and censorship resistant projects will not be controlled by a plutocratic few, but by the community.

Also, Read

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The Ether

Written by

The Ether

https://theether.io/

Coinmonks

Coinmonks

Coinmonks is a non-profit Crypto educational publication. Follow us on Twitter @coinmonks Our other project — https://coincodecap.com

The Ether

Written by

The Ether

https://theether.io/

Coinmonks

Coinmonks

Coinmonks is a non-profit Crypto educational publication. Follow us on Twitter @coinmonks Our other project — https://coincodecap.com

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