The purpose of this document is to outline a process for vetting and appointing individuals to control the allocation of EOS token creation, and therefore, the future direction of EOS. Control over financial resources is the ability to incentives the action of the community toward a particular vision.
There is a lot of background research and deep thinking that goes into the design of this governance proposal. To understand the philosophy please read the free book, “More Equal Animals - The subtle art of true democracy” where I expose the principles behind organizing people to work together under the law of the jungle.
One of the most difficult challenges for any community is identifying who is in the community and who is out of the community. Those who are in the community are committed to support the outcome of the governance process or to resign from the community. Communities are most powerful when people can yield to the group decisions without choosing to leave. Communities are most weak when they cannot make group decisions without creating division, resentment, and bitter culture.
In the crypto-currency world the definition of “community member” is often fuzzy and “self attested”. As a result, anyone can claim to be a member of the community and act in ways that are inconsistent with the desired code of conduct of other community members. This enables trolls and adversarial groups to paint the community in a bad light.
A true democracy is created on the basis of “invitation” where new members must be accepted by the group and must in turn voluntarily agree to be part of the group. Without this process a group can lose its identity and is unable to act in unity or maintain quality control and integrity to the group vision.
The most “basic” requirement to be a community member is to have skin in the game: to hold tokens. If you cannot demonstrate that you hold tokens then clearly you are not a community member. This is the approximate standard applied to all crypto currency communities. Unfortunately, this allows anyone with cash to join. Imagine if your country allowed anyone to buy a passport for one dollar. Uncontrolled immigration would allow a populous country to overtake the culture of a less populous country by simply sending an army of trolls to buy their way in.
It is not enough to hold a token. In fact, one could argue that holding a token is meaningless. Imagine if everyone that held a US dollar was automatically a “community member” aka “citizen” of the United States? Clearly the United States as a community benefits from the rest of the world (not part of the community) using their currency. Therefore, I would like to assert that token ownership is a necessary but not sufficient measure of community membership.
A better definition of a community member is a person who voluntarily submits to and honors the community governance process. The purpose of the community is to strengthen and protect its members independence and influence in the world. A community divided against itself cannot stand. This is not to say that everyone in a community must agree on everything, that is impossible. It is to say that they must agree on the process of governance and then honor the result.
All communities start with a single person establishing a vision and inviting others to join. Alternatively it could start with a small group of people who unanimously agree on a governance process and then that group starts inviting people to join. It is not effective to have an “open community” that allows people to join without invitation. Such a community would have a composition approximating the culture of existing wealth holders. Furthermore, your status of community member is contingent upon maintaining good standing with respect to the governance process. Invitations can be retracted. This is derived from he right to secede inherent to voluntary consent.
Becoming a Member
To become a member you must request (or be offered) an invitation from an existing member and have it confirmed by two other members. This means it takes 3 people to agree to accept a new member into the community. Finally the new member must be approved by at least one elected official of the community.
You can only invite or endorse new members after successfully participating in your first election. The reason for this is that the new member will be randomly assigned to meet with 9 other members of the community which will minimize opportunity for collusion and multiple accounts.
Every time the community grows by 10% an election is triggered automatically and no new members can officially join until the election process is concluded. This mitigates the risk of sybil attacking the election by creating a large number of fake users relative to real users.
Furthermore, each new member must make a contribution of 10 EOS to the community fund per election they participate in. The combination of financial contribution and endorsement ensures quality control, skin in the game, accountability, and sybil attack resistance.
Each member will be allowed to invite or endorse up to 20 people per election. This means that a group of 3 people can collude to invite at most 20 people per election.
Elections will be held at least once per year.
Evicting a Member
From time to time a community member may be found to be out of compliance with community standards and unwilling to make necessary corrections. The most obvious example could be the failure to complete a “proof of person” challenge. A “proof of person” challenge can be initiated by any existing member if they suspect another member account is either “fake” or “duplicate”.
The eviction process starts with an individual submitting a “evection request” along with a bond of 100 EOS. If 3 of 5 randomly selected elected officials approve the eviction then the bond is returned, otherwise the bond is forfeit.
When an individual is evicted from the community they lose their power to participate in the governance process, but they do not necessarily lose their blockchain account or any assets not explicitly contingent upon being a community member.
Authority Hierarchy
Every election starts by randomly assigning members to groups of 10. Each group of 10 must reach an 8 of 10 agreement on who represents their group. This would represent a Level 1 elected official. All Level 1 officials are then randomly assigned to groups of 10 which must reach 8 of 10 agreement on someone to represent the group, this represents a Level 2 member. If 8 of 10 agreement is not achieved then no official is elected from that group. This process is repeated until there are less than 10.
The final group of representatives (of size less than 10) will consist of 1 person with 2/3+1 approval (the president) and 2 people randomly selected from the top group (co-vice presidents). This will create 3 people who collectively form the root of the governance authority (a triumvirate).
Any action taken by the Triumvirate must be approved the president and at least one of the vice presidents.
Allocating Funds
Given a community budget of $10 million dollars per year (or about 0.25% of EOS inflation) this is how authority of the funds would be distributed:
50% of the community funds are allocated by 2/3 agreement of the triumvirate.
50% of the community funds are evenly divided as “budget” among the next lower level groups.
For each group that is awarded a budget:
50% of the budget is controlled by the elected representative of the group in combination with any other member of their group.
50% of the budget is divided among the groups below.
This process is repeated until there Level 1 representative gets full control of the budget for his group.
The outcome of this process is that a community with 10,000 people would elect 1000 representatives each of which will receive full autonomy over $12,500. There would be 100 Level 2 representatives which have control over $250,000 assuming they can get approval of one other member of their group. Lastly the president would control spending of $5 million dollars assuming he could get agreement from one of 2 randomly selected vice presidents.
If the community grew to 100,000 members with the same total budget, then the allocation would look something like this:
Interestingly enough, a community with 100,000 members each contributing 10 EOS per election would generate $4 million dollars worth of budget automatically without the need for any inflation. As the community grows and the value of EOS grows with it then the budget would scale automatically.
- Yes
- Maybe
- No
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