Governance Model and Voting System

Hello All,

Without good governance voting model it will be hard to define good proposals and vote for them,

At first Pango supporters need to choose which , what type of governance to be in.

How Pango users going to vote for each proposal, what will be the criteria? Community needs to define that kind of subjects first.

-Each PNG holding worth a vote? (if this is the case how to be sure that couple of whales won’t have so much power against governance itself?)

-Each unique address able to vote? (If this is the case how are we sure about network spamming)

-We need to define voting mechanism first and this decision will effect for future community decisions and Pango holders.

From my point of view, each unique address 1 on-chain vote is best and allow plebs to reach real “democracy” but to prevent spamming the network, it would be better stake some quantity to join a voting (250-500-1000-2000-10000) you name it for at least a month before voting for this unique address is eligible.

Or do we want each PNG holdings worth one vote, Avax/PNG liquidity pools or and PNG liquidity mining worth multiplies (x2 - x3 -x5).

Governance and voting criteria needs to be defined before proposals.

20 Likes

So from the litepaper (below) it looks like the intent was to weight voting by PNG which would eliminate or limit the spamming issue. I think there needs to be more detail as to exactly how this would be weighted. I would suggest quadratically as opposed to one vote per PNG. This would significantly decrease whale power. You could go exponential but that is quite steep. You could also combine that with capping the number votes per address but that would bring spamming back into the equation.

Quadratic example:
3 PNG = 1 vote
10 PNG = 2 votes
21 PNG = 3 votes
36 PNG = 4 votes

You could add in some bonus votes to each address for X amount of PNG kept in liquidity pools for X amount of time (agree at least a month, maybe two) to incentivize more staking of PNG. The number of votes provided for each X amount would need to be carefully analyzed against the quadratic scale used (what is the starting # of PNG to get one vote) so that is impactful but not too dominating for whales.

Also think a feature like Compound’s autonomous proposals should be considered. Link below.

From Litepaper:
The Pangolin governance thresholds are as follows:

  • 10% of PNG circulating supply (delegated) to submit a governance proposal
  • During a voting period, a simple majority (>50%) of ‘yes’ votes weighted by delegated PNG that totals at least 15% of the circulating supply of PNG is required to reach quorum
  • 7 day voting period
  • 2 day timelock delay on execution

These discuss quadratic voting:

https://medium.datadriveninvestor.com/yearn-finances-founder-and-others-aren-t-bullish-on-uniswap-s-current-governance-model-2ed6c80626d5

6 Likes

We need to know if PNG held in liquidity pools is able to vote.
Also, is there a minimum holding time to allow voting, to stop buying to vote and sending to another address to vote again.
Some governance requires staking for voting.

The main idea is both evade from both plutocracy and as well crowd majority with small stakes.

As per lite-paper it is really hard to reach %10 of PNG supply as crowd majority with small stakes but this %10 to submit proposal and %15 circulating requirement to achieve quorum is still achievable if couple of high stakes joined the 1png1vote (1p1v) to reach simple >50% majority.

QV seems practical ways for on-chain voting with many advantages,
-it did not eliminates sockpuppet behavior and network spamming but protecting average Joe from weighted 1p1v and it would be the best option available it seems.

How to improve QV?
-Time-lock (staking PNGs) to allow voting way before proposals. (this will seriously reduce spamming I believe)
-in Addition we have all the information of token holders and we are trying to reach median of holders, it has required simple pareto analysis that only 80/20 accounts are producing tangible income so average of those %20 accounts will be highest cap to vote at max.

For bonus votes who has providing liquidity on PNG is great idea, and promotes Pango users to mine more liquidity on PNG pairs. Voting max limits may be defined same as above and minimum duration for LP needs to define as well to showing trust and taking risk should be rewarded imo.

For the minimum cap to be eligible to vote may be work for simple average of all accounts so anyone who is holding or liquidity mining quite low amount of PNG will have the voice to vote for any proposal. (if we consider many accounts has zero PNG, total PNG average would be really low)

So Community need to think about those governance models and voting systems deeply and have mutual agreements before governance alive for 2 months,

I really appreciate with the ideas you suggested, I believe community find out great proposal regarding voting mechanism for this unique %100 community driven defi platform.

First question has to be yes. Second question I would suggest yes as well.

This is fantastic!! Quadratic voting eliminates alot of the problems of traditional voting structures. I’m all for quadratic voting.

Implementing Quadratic Voting though will take a lot of work.

The Compound Autonomous Proposals though should be fairly easy to fork from Compound and implement. I see it as having multiple benefits. One of the key benefits is allowing anyone in the community to have a voice.

5 Likes

Agree 100% with the requirement to document governance. I have opened a separate proposal to start the task of pulling the collateral and supporting documentation together reflecting the agreed governance framework. That is a significant task alone.

Obviously, before any of that happens, there needs to be consensus on what form of governance the community has selected. I think the question is broader than who can vote and the relative voting power of each wallet. We also need to establish how candidate proposals are handled and submitted for a vote. It’s easy enough to stack the deck with sub-optimal proposals while otherwise good proposals are side-lined. This is especially a problem with off-chain proposals but it can happen with on-chain proposals too.

One option to address this and streamline the process might be to have a “governance group” - either volunteers or elected by the community - who have the task of shortlisting candidate proposals based on agreed criteria and shepherd them through with the help from “sponsors”. Without that, the forum will turn into a disorganised mess pretty quickly and people will vote on things they don’t fully understand and miss opportunities to implement good ideas that don’t get the love they deserve.

I think some volunteers have already been identified to help the community start this process according to a Discord discussion that happened yesterday so that’s good news.

1 Like
  1. How do we apply any weighting if the same guy can just send votes from different wallets?

  2. If I understood correctly, a quadratic weighting will favor by a lot the minor stakeholders, while the whales are actually owner of the 90% of the liquidity in the exchange, if you were a whale looking to invest in a platform, would you invest in a platform designed to take out your power?

  3. I’m seeing discussions about which pairs should reward more, or less, PNGs. I’m seeing arguments that goes in the lines of: “AVAX is already a big guy”, “We’re feeding the whales by rewarding AVAX pairs”… these kind of arguments are in favor of rewarding more PNG pairs, which is NON-SENSE. Pangolin EXCHANGE principal objective is to provide liquidity in non PNG pairs, as we want more, and more investors to just come to our platform, swap, and carry on with their lives. If we give less PNG to the pairs that provide the wide audience functionality, we’re incentivising people to provide less liquidity there, thus, hurting the exact purpose of existence of Pangolin.

3 Likes

1- If one whale try to choose sockpuppet behavior or network spamming you cannot prevent that technically, but you may set a rule/s (for any unique address) to staying at PNG staking or mining on PNG pools for a decent of time (month at least) to eligible for voting proposals (min PNG requirement would be like %20-%30 (community negotiable) worth of the whole account). time-lock will play huge part to prevent such behavior (ideally), because no one is going to risk it’s money only to vote without knowing proposals. Weighting will be simple for proposals, if anyone want to vote double, triple, or their whole accounts they need N^2 PNGs and max cap will be average of top %20 accounts to reach real quorum.

1 pngvotepower = 1 png
2 pngvotepower = 4 png
3 pngvotepower = 9 png



100 pngvotepower = 10.000 png


Max pngvotepower is high stake %20 avarage

2- Well, QV will not work for minor stakeholders, instead it protects high-average accounts from both minor accounts and whale accounts. With that kind of model one person cannot manipulate the proposals. Whales are the becoming owners of the exchange itself, if they have enough voting powers to direct as they wish. They are not providing liquidity to become an owner, rewards are high so they enjoy the earnings. By applying QV we may reach average accounts, people’s voice matters no matter how much money they risk on Pangolin but I believe collectively they will find better ways to increase dex potential than a single whale. Considering from whale perspective, yeah I’m not a whale so may not able to foreseen the result, but suppose if you get rewarding enough and rules are clear that kind of voting do not push whales away. Whales are way better to adapt the rules more than average and they have common sense. They may even choose not to hold any PNG and not voting, but mining liquidity because it’s rewarding. So only providing liquidity and getting rewards do not make a whale a part of the governance.

3- Well its all about risk-reward equilibrium, if anyone thinks PNG should be rewarded more by basically taking more risk to provide liquidity on PNG pools, so high risk pools should rewarded more. it’s logical not non-sense. Getting totally same rewards for AVAX-abc pool (except PNG) pairs won’t help PNG to grow, I believe Pango’s principal objective is make this exchange grow and compete with other legit decentralized exchanges, rewarding same amount of PNG on non-PNG pools basically not helping for this purpose and returning back as continuous selling pressure to PNG and early AVAX holders are paying the cost.

2 Likes

I still think this is not feasible, and not decentralized, unfortunately whoever has more at stake will be the one that is most affected by the changes, I don’t believe in this system and it will not take long for a bad decision to drive the whales away and hurt our liquidity bad, if anything, we should be fighting to get more whales, so I would fight for a better environemnt for the whales to decide among themselves than having low/medium investors to decide for whales. I can’t speak much about my profession, but I work on an environment that is full of whales, and I know from everyday work that all that the non-whales want are ways to steal/damage the whales, ofc this can backfire here, and having the mindset that hurting the whales can backfire on us is what I think we’ll lack when doing a populist democratic system.

There’s topics and topics of people talking about whales, like if they are the enemies, you see where I’m going?

1 Like

First of all whales are OK, they provide liquidity and they deserve rewards which is already available on lite-paper, joining the pool with a knowledge that they can earn from their liquidity, whales are not enemies for sure, %100 agree on that. It will not be logical to change Avax rewards but treasury funds may allocate for only-png pool pairs to boost LP to attract more risk/reward, but this is not subject of our topic.
We are not seeking for democracy to allow minorities to govern but to reach more people to get involved on voting and make average people votes have meaning for high end users (not only one or two accounts bullying other accounts). QV will not push whales away, many of the proposal will also beneficial for whales but it will not only act primarily in their interest. 1png1vote is bad for decentralization imo.

1 Like

My point is, you want to fight whales? sure, then just put your money in the game too, it’s not fair to play the game at the same level without staking the same risk. I’m still thinking this is just another topic of people trying to feed from whales, that is not how things works, put your skin in the game then your vote matters, I like the greedy strategy because it pushes the small fishes to be bigger fishes to fight the whales.

1 Like

Having more amount of money is not make one’s mind better than other. It’s money irrelevant subject. That is why collective community, decentralization and each people’s voice matters.
If you are happy with your plutocracy and saying QV is not decentralized but putting more money in the game to vote, good luck with your view.
I suggest you to check again Vitalik’s view on QV. I believe he is not trying to feed from whales. maybe your whale colleagues looks like shrimp considering his worth.

1 Like

I’m not saying that I don’t like the QV concept, I love it, really, but we’re not there yet. In the end, money is what drives our community, and having alternatives where big players can put their money will always put us on a hostage spot. And I really feel we’re lacking the incentive to have people put the skin in the game if we’re going QV. I would argue that if 100% of whales, that is responsible for 95% of money in the game can have 50% of stake in the votes, that is borderline acceptable, but good luck figuring out that. Less than 50% makes it ridiculous daunting for them because in the end, they are staking more than you are, so the fall of a mistake from the community will be bigger for them. Risk is the keyword here.

2 Likes

Quadratic voting won’t work for empty-low or even for medium accounts, it won’t damage whales, because that means high-medium holders are damaging more from the any proposals than whales and academics shows, that would be robust and avoid the fragility of other methods. I just don’t want this exchange to end up like a sushi, so if community agrees on 1png1vote, it seems you are offering that type governance, it’s OK, I’ll respect that as well by exactly knowing where to reach and end up.
we have over 7650 unique address and only 100 account has holding over 5k PNG those are already have %85 of circulating supply. Basically what I’m saying is, do not only let 1-10 to decide on proposals (%50 voting power already got from only 10 accounts) and allow 10-100 accounts to vote right by thinking those accounts needs to have a voice.

Doesn’t the math suggest the opposite? Isn’t the point of quadratic voting to give minority holders greater say in voting outcomes?

I’m personally not worried about sock puppets - a whale would need to open a lot of sock puppet wallets to get significant advantage. I like @Oysterjr suggestion to have a minimum PNG staking period to counter that issue.

We should also keep in mind that one reason people with smaller wallets don’t vote is because they don’t think their vote has value. Give that vote real value and you will get better engagement from the community.

Whales will always have a large voting block proportional to their stake in the platform but they need Pangolin to be successful and that means high levels of community engagement. At some point in the next 5 years, those whales will become small fish when the really big whales arrive and they will be glad their small vote will still count :slight_smile:

On that basis, I vote for some form of quadratic voting as a better solution than 1PNG-1VOTE

Actually it does breaking collusion of top %1-2 accounts instantly “whales” plus to that not giving “minorities” (in this case low-medium accounts) to more outcomes, not like “democracy” but protecting everyone on the ecosystem by giving the highest possible financial outcome out of proposals theoretically.

Math says, 1png1vote is so risky. (If we check our current distribution only 10 account vote power enough to reach >%50)

On quadratic type of voting without top %20 accounts consensus, “minority” cannot able to push any proposal as they wish. Basically more png holdings means more pngvotepower (√N) and on normal distribution curve we will lean more to right side between +2sigma to +3 sigma standard deviation, definitely not middle.

2 Likes

Apologies - when I was referring to “minority holders” I was using the legal term that refers to minority shareholders in a company (analogous to the large group of voters with small amounts of PNG in their wallet).

I’m assuming you included the distribution curve to identify where the new equilibrium sits with a quadratic voting system? I’m actually more interested in the efficiency generated by quadratic voting - how do quadratic voting rights affect the ROI per PNG in each proposal?

I think “efficiency” - as in ROI impact - is a better measure than how quadratic voting affects the voting power of a few whales. It won’t matter if the voting outcomes are efficient, will it?

Either way, it seems that there is enough support for quadratic voting and it’s a matter of refining the parameters to recognise the points raised by @RobbiJm post.

We are using “minority” with same terminology and yes I put normal distribution curve to show how it would be on “democratic” systems (which gives minority crowd greater say in voting outcomes) and to show what is changing by applying N^2 system voting.

1 pngvotepower = 1 png required
2 pngvotepower = 4 png required
3 pngvotepower = 9 png required

goes on…

Return of investment (ROI) is more depending on proposal itself so if proposal itself is not “efficient” and voters are forced to vote anyways with lack proposals, it won’t help much to the voting system itself. Voting system just trying to design parameters to decide if proposal is good enough to pass or fail. Nothing more.

I think we still need to discuss about voting system deeply as community and more people should get involved about voting system, than file them in a clear way to every participant knows how to vote, what to do for eligible to vote etc…

2 Likes

Agreed - the documentation explaining the voting system needs to be simple to understand. I’ve looked at some of the voting documentation used on other platforms and you need to be a Ph.D. student to understand some of those things. I’ve offered to help with that task.

2 Likes