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nicovrg (fut/acc) pfp
nicovrg (fut/acc)
@nicovrg
My thoughts on the future of governance and the project i have the highest hope for 2024. The hard part here is not what to write but what not to write. Too many rabbit holes. I'll skip most of it and focus on the essential 🧵
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nicovrg (fut/acc)
@nicovrg
Democracy is government of the people, by the people, for the people But the people are retarded ... So let us say, government of the retarded, by the retarded, for the retarded
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nicovrg (fut/acc)
@nicovrg
Most people don't know what's good for themselves
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nicovrg (fut/acc)
@nicovrg
Democracy don't work. I'd argue an enlighten dictator does a better job DAOs don't work. I'd argue an enlighten founder does a better job
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@nicovrg
The reason we have these is because we can't trust an enlighten dictator or founder not to go senile or his successors not to be incompetent or evil Yet there is something even more sad: social intelligence doesn't scale
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nicovrg (fut/acc)
@nicovrg
How come a single brain can outmatch thousands/millions of brains? Democracies are neural nets without layer or weights. Output is garbage DAOs are neural nets without layer and token are used as weights. Whales weight void the rest of the graph. Output is corrupted
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nicovrg (fut/acc)
@nicovrg
There were attempts to improve DAOs with things like quadratic voting but most of the innovation can't be built today because of missing primitives (identity, reputation, knowledge, time spent, energy etc ...)
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nicovrg (fut/acc)
@nicovrg
Imo a system with proper layers and weights would be far superior at leveraging collective intelligence There is more compute and data in the brains of all employees/citizens (leader included) than in the brain of the leadership What if governance looked something like this?
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nicovrg (fut/acc)
@nicovrg
How do we do this? This is the tricky part. Its extremely hard to find the right model and the easiest way to proceed would be iterative testing at a scale (space & time) the real world can't support
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@nicovrg
I'll not go into all this rabbit hole since its not the goal of this thread. I haven't give up on the idea yet. I'm just no sure where to start. Surely, there must be a more simple and elegant solution
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nicovrg (fut/acc)
@nicovrg
Turns out someone found just that! An economist that goes by Robin Hanson conceptualised "futarchy", a governance structure based on markets An anon builder that goes by Proph3t implemented it on solana. It's called The-MetaDAO
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@nicovrg
Markets are free* Markets are efficient** Markets have no emotions Markets have no carrer risk Markets are apolitical Markets aren't woke They transfer wealth from the ignorant to the wise They aggregate all information into a single number, price
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@nicovrg
* if not corrupted by forms of printing lile monetary policy, naked short etc ... ** on the long run, efficiency is a spectrum
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@nicovrg
Market participants have capital at stake We don't need layers, traders are incentivised to stay out if they don't think they have an edge, they'll jump in if they do We don't need weight, traders capital will increase if they are pertinent and decrease otherwise
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@nicovrg
Futarchy are easier to implement. There are different way of doing so. I think metadao conditional market is a beautiful design Futarchy is a new design space that has yet to be tried & experimented with
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@nicovrg
One area i think futarchy would be far superior to team multisig or to dao is grant Futarchy optimise for value accrual. Grants would pass if market believe it'd add value. It'd remove biais & politics shenanigans
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@nicovrg
How does it works? The $META token is the base of our futarchy Anyone can submit a proposal (description + svm instructions to be executed) Once submitted, two markets are created, we call them conditional markets
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nicovrg (fut/acc)
@nicovrg
Futards can mint conditional token - pair of $pMETA & $fMETA - representing respectively the value of the token if proposal pass or fail These markets trade simultaneously for a period (now set to 3 days)
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@nicovrg
The market with higher twap (time weighted average price) will be finalised & the market with the lower twap will be discarded It all happens onchain. If the proposal pass ($pMETA twap higher than $fMETA twap) the proposal svm instruction will be executed
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nicovrg (fut/acc)
@nicovrg
One thing that futarchy will need to work around is keynesian beauty contest (market participants trading based not on outcome of proposal but on other trader perception of outcome of proposal - can be recursive)
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@nicovrg
I'm curious to find out if/where futarchy fails. Many scenarios have been discussed on the discord
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@nicovrg
Proph3t is the perfect person to lead this project. He is a chad dev & a true market nerd. He believes this is the most important thing to work on and i've seen him commit his time & energy doing the hard, right thing
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