Polkadot’s Industry Leading Governance Raises its Own Bar: The Fellowship Manifesto
Bits of Signum | 10.03.22
Dr. Gavin Wood published the Polkadot Fellowship Manifesto, detailing a key change to Polkadot’s governance as it upgrades to Governance v2 (Gov2) in the coming months. The core purpose of the governance upgrade is to further decentralize Polkadot’s governance process and to make software maintenance run more efficiently. Two weeks ago, we participated in the Messari Mainnet conference and were interviewed by the Messari analyst who covers Polkadot, Nick Garcia. Nick mentioned that many are unaware that Polkadot is already an industry leader in network decentralization, with a very high “Nakamoto Coefficient.” The Nakamoto Coefficient was created by Balaji Srinivasan and is defined by him as follows:
“The Nakamoto coefficient is a way to quantify the decentralization of a blockchain or other decentralized system. It's the number of entities you need to compromise at least one essential subsystem.”
Polkadot Decentralization Tidbit: A key design win of Polkadot’s version of Proof of Stake is in the way rewards are collected by the people who secure the network. The network’s 1000 validators will all receive the same reward, which is a built-in incentive for users to nominate the smallest validators (as they will spread the same reward over fewer users who nominate them.) Therefore, equally sized validators is the natural state of equilibrium in Polkadot.
The Manifesto is a call to Polkadot developers to join the “Fellowship,” which will replace the existing technical committee. Polkadot Co-Founder, Rob Habermeier describes the Fellowship as a “Developer DAO'' that will serve three roles in Polkadots’ Governance and Community:
To act as a 'technical advisor' to the governance system.
To maintain and develop core protocols and code.
To educate and evangelize the technology and philosophy of Polkadot
Notably, the Fellowship does not have explicit decision-making power in Governance. Instead, it handles “easy” decisions which should not take a full 28-day process, somewhat like an expert stamp of approval. The reason this was an important improvement is because, as is the case for many blockchains, all decisions were treated equally. Therefore, small decisions were creating time bottlenecks for large decisions which are more appropriately voted on after a full 28-day deliberation period. Now, decisions can be expedited if the Fellowship and community support a decision en masse. In summary, decisions that have less impact on the health of the network or the full support of the community in a few days can go through quickly. Large, potentially-controversial decisions will continue to take the full 28 day timeline.
To provide more context on this network update, it is helpful to understand the core philosophy behind Polkadot’s structure and the rationale for this upgrade to Gov2. In this greater push for decentralization that is cryptocurrency, most networks still have embedded centralization. This often comes in the form of: 1) a small validator set (see our post here on the Axie Infinity hack, in which five of nine validators were compromised, four of which were controlled by the company), and 2) off-chain treasuries that can be controlled by centralized parties (e.g., the Luna Foundation Guard). Polkadot’s Governance has uniquely had a fully on-chain treasury since inception. Tezos is the only other network we know of that features this.
The Technical Committee currently has the ability to fast track votes and is being replaced by the decentralized Fellowship. The Network Council is a separate body that consists of 13 key members of the Polkadot community, and in addition to expediting proposals, can also veto proposals it views as dangerous. Gov2 will also remove the Network Council entirely (note: Network Council is different from the Foundation Council), in addition to replacing the Technical Committee with this Fellowship. Members of the new Fellowship can be paid by the treasury in order to ensure long-term alignment between the members and the success of the network as a whole.
So, how does Gov2 safely remove the Council? Polkadot developers built Gov2 to offer a balance between safety (users cannot manipulate the governance process for their own gain) and agility (the speed and volume of which proposals can be executed). An important part of this “agility” component is ensuring that the most important proposals are seen by those participating in governance, especially once anyone can make a proposal and there could be hundreds or more proposals open at a time. In Gov2, if a proposal receives a significant number of "yes" votes with few "no" votes in a short period of time, then it is considered significant and could pass in a few days or less. While in Gov1, the centralized Network Council and Technical Committee would need to push through any urgent changes (e.g., a code update in the case of a bug), Gov2 will allow DOT holders to enact these sorts of high priority, high impact votes in a decentralized manner, and allow Polkadot to continue operating as a truly decentralized network.
Polkadot has remained a stalwart proponent of true decentralization—its initial vision was to bring all three sides to the triangle: security, scalability, and decentralization. As Polkadot is composable, upgradable, and use-case agnostic, its developers can continue to build, experiment, and evolve Polkadot with the world around it.
Disclaimer: SGC is an Advisor to Web3 Foundation