Quadratic Voting and DeFi Governance
One of the recent addition to voting theory, quadratic voting addresses some of the limitations in DeFi governance models.
Governance is the area of DeFi that has seen the least amount of innovation in recent years. Compared to the incredible sophistication of many DeFi protocols, most governance models are still based in the one token one vote model which, although simple, it is very vulnerable to market manipulations. From pushing proposals beneficial to large token holders to collusion mechanisms to control the behavior of a protocols, DeFi governance models remain too fragile to support the next generation of financial applications. Fortunately, voting theory offers many voting techniques that can bring more resiliency to new waves of DeFi protocols. Among those techniques, quadratic voting stands out as one of the more interesting ideas that can be immediately applied to DeFi governance.
I discovered the idea of quadratic voting by studying the Radical Markets thesis and the brilliant talks of Microsoft Researcher Glen Weyl which are now captured in the book of the same title. Some of the concepts behind Radical Markets have permeated into the blockchain world with Vitalik Buterin discussing the concept in a very insightful blog post a few years ago. Butterin and Weyl…
