Crypto Governance Mechanisms

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Nathan Schneider:

"During the cryptocurrency boom cycle of 2017, governance was often treated like a problem to be solved by a uniform and scalable solution. Projects suchas Aragon, Colony, and DAOStack set out to become the operating systems for governing diverse kinds of networks, thanks to airtight cryptoeconomics and a user-friendly platform (El Faqir et al., 2020). By the time of the 2020–2021 boom, cryptoeconomic governance had become more a reality than just an intention. It was also fragmented and scattered, taking place across diverse and cobbled-together sets of tools, many providing governance mechanisms unfamiliar in legacy institutions. Cryptoeconomic governance did not appear to be converging toward a single mechanism but was diverging into webs of diverse and interconnected processes. From the Kleros judiciary to 1Hive’s various social halls, economic incentives are present at everylayer, even where participants articulate non-economic goals. Lane Rettig of Spacemesh says, “It is turtles all the way down”—meaning, by turtles, thatcryptoeconomic systems sit atop more cryptoeconomics, and so on (personal communication, April 27, 2021)."