That is what I understood too, 1 million of people doing 1 png votes will outweight any amount of medium-high and whales together
if one or many tries to spam network for such behavior and lets say open 1 mil unique account (we have 7700 PNG address btw) to buy 1 PNG and join a pool with those for a month, that will cost that user/s >$15M + fees for what? grabbing only %30 of the vote power and risk >$15M?
Even any hesitation for Sybil to prevent that you simply set min PNG rule. lets say 10 PNG min requirement and join a pool so this makes almost impossible to spam network.
I’m not talking about a behavior, I’m just talking about massive adoption of the platform. So here’s where quadratic gets funny. It’s only worth for him to hold up to X votes, from that vote on, it’s just getting too “expensive”, so at this point there’s no point in holding to the PNG, selling it to other users, usually smaller adopters as they are getting the best value out of that PNG price, then, the mass of smaller fish will just outweight any medium-high + whales.
Now, let’s say that:
- Medium-high is 15% of all PNG population
- Whales are 1%, that comes up to 16% total population
- The other 84% is the medium-small
Following your formula on a population of 100 people:
- 1 is a whale(1%), and will do 100 votes, spending 10k PNG
- 15 is medium high, and will do 25 votes each, spending 625 PNG each, total 9.375 PNG
- 84 is medium small, and fishes, lets say they average 7 votes, spending 49 PNG each on average, total 4116 PNG
That assumption is not aligned with pareto distribution,
You assume whole %100 has enough power to vote but this whole portion’s %80 is complete empty accounts (not even medium-small). those accounts are not providing any income to ecosystem. they even do not have that much PNG, no need to mention average voting power for those accounts.
So here is the catch, real world example, we have 7700 account on PNG, how may is not available to vote in that case if governance set a min staking rule? Make it more clear for you, how many account is below 30 PNG? Answer is 4850 unique address is below 30 PNG not have any voting power. (%63 of whole portion)
And you assume %85 has average 49 PNG to vote? Even 4850 account do not have that amount on total 7700.
Lets assume exchange reached 770K unique address and only 285k address will be eligible for voting.
Your %84 “population” has not able to spend 49 PNG for voting because in reality they don’t have it.
Voting for proposals will be distributed and accepted only on top %20 because those accounts are providing tangible voting power.
Yes I do assume they have 49 PNG on AVERAGE to vote, because as mentioned before:
It’s only worth for them to hold up to X votes, from that vote on, it’s just getting too “expensive”, so at this point there’s no point in holding to the PNG, selling it to other users, usually smaller adopters as they are getting the best value out of that PNG price, then, the mass of smaller fish will just outweight any medium-high + whales.
If they sell, prices are low, if prices are low, small fishes can access them because the price vs value benefit for them is very high.
It’s also important to note that I’m highlighting here the
voting population, not just any account.
The example was not designed to follow paretto law, I believe the quadratic voting will cause this effect where 20% of the population will not be responsible for 80% of the result because it’s too expensive above a certain amount of vote so they will just sell the PNG effect I highlighted at the beginning of it all. All the time here the whole purpose of this proposal was to dimish the power of voting for high-end users, and then you come to me complaining my example didn’t follow paretto?
And you assume %85 has average 49 PNG to vote? Even 4850 account do not have that amount on total 7700.
No one had the reason to buy them yet besides financial speculation, you can’t take a sample like this because it’s not worth anything, the same way if I take as example what happened in the last 100 years of stock market, that won’t predict the future of the stock market.
Ok, even exchange reached millions of users 20/80 pareto law won’t change that much, because this is how world works not only financial sector, management, manufacturing etc… So I’m standing from the point that that %20 vote as an account as close as possible at least to the top whale, So what will happen to people who do not have enough PNG (%80 minority crowd), so that means to be a part of governance they need to pay the cost. If we choose 1png1vote vote distribution, voting will only be limited for top %1 maybe less. If we achieved to break that by QV or any other suggestion from community and everyone has almost same voice with same PNG holdings and tries to expand this dex that would be the true power of decentralization, but we are so early to talk such things.
Quadratic voting doesn’t make much sense, because the whale can simply split all the PNG in different accounts.
Aaaand your better proposal is?
It depends on what the goal of voting is.
If it’s only for governance a 1:1 vote is the right thing. Full democracy. Considering also all PNG staked in liquidity pools. If whales has lots of PNG it’s because they bought it investing a lot in the project or they provided lots of liquidity so it’s correct that they should have more right in voting because they are risking more and they are invested more.
If they have too much PNG for other motivations, then it’s not the point of this discussion, but maybe we should rethink how PNG are distributed.
Quadratic voting makes a lot of sense compared to 1 PNG = 1 VOTE (or 49 PNG = 1 VOTE), especially if paired with wallet age requirements. A whale would need to open a lot of wallets and hold PNG across all of those wallets - no whale is going to do that long-term.
So you are saying 1png1vote am I correct? and it looks to you a “full democracy”?
Yes. It’s proportional to the investment in the system. And btw if a whale has lots of PNG then the problem is not in the voting but in PNG distribution. Either the distribution itself is wrong and unbalanced or the overall system is not working. A healty system would bring liquidity from lots of small and medium investors which should overcome the whales in the long run IMO.
@Pablo A whale with 100M$ can spend 1k$ in a bot that automatically spreads the PNG in thousand of accounts and can spend 1k$ in transactions fees, so yes quadratic or any other exponential voting doesn’t make sens IMO. In fact you don’t see it in any governance system.
That’s not quite the true cost. Transaction fees aren’t a barrier. But you’re forgetting the cost of capital. A whale doesn’t leave capital lying around to vote on irregular proposals. And if they did, the benefit actually flows to smaller wallets who win from the increased scarcity of PNG.
Which brings us to the most important point of quadratic voting - efficiency. That requires a full cost-benefit analysis beyond simple voting power. That’s the great insight of quadratic voting and one of the reasons why big corporations don’t use it - “efficiency” results in redistribution of profits/dividends away from senior management and large shareholders.
Ok clear now, that shows you know nothing about “democracy”. more money more voting power is
actually calling “plutocracy” and those type of governance using their power to serve their own purposes and thereby increasing poverty and nurturing class conflict, corrupting societies with greed and hedonism. If you would like to be a part of plutocrats environment there is sushi there, they are currently voting a proposal about Solana/Raydium integration and many high end users vote worth nothing comparing to 1 whale.
So I personally do not want to be a part of that type governance, but even tough community decides to add fuel to the fire and accept 1png1vote, I respect that and move on.
Which cost of capital? We are talking about spreading the PNG to different accounts to game the quadratic system. The whale doens’t have to change anything about his capital, just move it in a different arrangement. What efficiency are you talking about?
@Oysterjr of course it’s not democracy in the common sense, where 1 person = 1 vote. There are no ID associated with wallets and/or PNG, so the only value we can consider are PNG. PNG are the identities in this system. Any system different to 1:1 can be gamed somehow because there is no way we can track how PNG are related to single people or entities. I challenge you to come up with a different system that cannot be gamed by whales with lots of resources.
This would we the perfect solution, but it’s not easy to implement and it’s still at its infancy: Proof of personhood - Wikipedia
While supporting 1png1vote and talking about network spamming and sockpuppet behavior and kind of negative sides of QV is weird but let me try to explain below;
To spreading PNG to different account, for each unique address that bad behavior whale has to enter a pool or staking its own PNG to become eligible to vote for a governance decided period of time (I suggested at least a month) this is huge capital risk because PNG prices are moving both upwards and downwards.
Who does that for unknown proposals?
For second comment, we are not exactly seeking for “democracy” 1person1vote as well because minority group may vote for irrational proposals such as airdropping equally on all accounts from treasury funds and won’t help for high economic development to this exchange. Even if we have identification mechanism it will be burden for main accounts (%20) who are true believer of decentralization and risking their real money on this purpose.
(PNGs are not identities PNG is governance money and identities are Unique addresses)
But the hypothesis are that the whale does want to have the voting power, so somehow he has to buy/have PNG and stake them in a liquidity pool or in a vote staking pool.
I see no difference at all if he does that in 1 account or 1M accounts.
In your example the cost of 15M$ is for acquiring the PNG which he has to do anyway for voting. That cost is not related at all (if not for tiny fees of transactions) to spreading the PNG to thousands of accounts.
And the minimum PNG (the min of 10 PNG example) is even worst because you are cutting out of the voting the small holders, while the whale can esily have 10 PNG in 10k accounts.
What I consider a whale in this case is an entity having lots of PNG, so we shound’t consider the cost of buying PNG in the equation at all.
Yes I suggest to cutting off minority accounts (for spamming purpose and not to damage top %20 accounts (Those are the ones providing tangible liquidity to Pango) simply by voting irrational proposals) and force them to pay cost to become eligible to vote.)
For each activity of many accounts from one whale will make huge buying pressure on PNGs, which is good thing, getting away from circulation of that min amount of PNG by staking or by providing liquidity on PNG pools is is also good for economic growth theoretically.
But the main reason of voting systems are not those, we are just trying to reach an agreement on good proposal weather they are good (pass) or bad (fail) with as much as unique identities possible. Not too allow only 1 or 2 accounts to bullying or collusion whole governance by 1png1vote mechanism.
Efficiency is the great insight of quadratic voting.
Apologies if the maths that follows is incorrect - happy to take corrections:
If, let’s say, we had a 28 day hold requirement for every voting wallet, a de minimus voting threshold and quadratic voting power, it starts to get very expensive for a whale to split up their PNG into separate wallets. Bots don’t make things cheaper, nor do the low transaction fees. The PNG held by sock-puppet accounts costs the whale a lot by comparison because that PNG can’t be used to re-invest elsewhere. That’s the cost of capital - it’s not linear in quadratic voting systems.
So, to take your $100m whale, they would need to open about 340,000 wallets holding 49 PNG (using $6 per PNG) to get the same voting power per PNG as people holding the 49 PNG de minimus. On top of that, they need to hold that amount of PNG in the wallet for, let’s say, 28 days. No whale will lock up capital like that, unless the return on that investment would exceed the returns offered by other options.
I’m not sure how you came to $1000 transaction fees - each contract call costs about 0.03-0.06 AVAX. Let’s say an average of 0.045 AVAX. Using my example, setting up the wallets and voting for the whale will cost the whale about 4 transactions per wallet so 0.18 AVAX = $5.40 per wallet at today’s rate. The minimum cost is about $1.8m for each and every vote. That’s a lot of money just to get parity of voting power.
What about cost of capital? Based on todays rates, keeping PNG out of a pool or other investment contract for 28 days would result in a loss of about 2.27m PNG over the 28 days. So let’s say another $13.6m of lost returns per month.
To make matters worse for the whale, they need to keep the PNG split up into 340,000 separate wallets for a long time because if they unfairly benefited from a proposal, regular folks would just introduce a new proposal and reverse the change as soon as the whale moved the PNG back to their master wallet.
By comparison, the 49 PNG held by the thousands of small wallets holders who are real people doesn’t “cost” them much. It costs them less than $4.50 to vote and a cost of capital loss of about $44 over the 28 days.
Maybe the whale can optimise this model to reduce the number of wallets they need but I’m exaggerating to make the point that it is very expensive to run sock puppets in a quadratic voting system with other protections in place.
That’s part of the efficiency that quadratic voting offers. It leads to efficiency in voting outcomes because the cost-benefits of each vote are distributed to smaller wallets and that leads to greater voting engagement.