Governance
Summary
Blockchains are distributed systems. They are essentially consensus protocols, which means that different nodes in the network (e.g. computers on the internet) have to be running compatible software.
“Node operators” are the owners and managers of nodes that run the protocol. Most node operators don’t want to write much software, and it’s a technical challenge for anyone to independently write compatible implementations of any consensus protocol even if they have a specification. As a result, node operators rely on software repositories (usually hosted on Microsoft/Github servers) to provide them with the software they choose to run.
“Core developers” of a blockchain are software developers who work on the software that implement that protocol. Developers have processes that are supposed to assure the quality of the software they release, and are generally very interested in maintaining the legitimacy of their software repositories because they want to see people using their software (as opposed to someone else’s).
Critical Components of Governance
1. Incentives
Each group in the system has their own incentives. Those incentives are not always 100% aligned with all other groups in the system. Groups will propose changes over time which are advantageous for them. Organisms are biased towards their own survival. This commonly manifests in changes to the reward structure, monetary policy, or balances of power.
2. Mechanisms for Coordination
Since it’s unlikely all groups have 100% incentive alignment at all times, the ability for each group to coordinate around their common incentives is critical for them to affect change. If one group can coordinate better than another, it creates power imbalances in their favor.
In practice, a major factor is how much coordination can be done on-chain vs. off-chain, where on-chain coordination makes coordinating easier. In some new blockchains (such as Tezos or Polkadot), on-chain coordination allows the rules or even the ledger history itself to be changed.
On-Chain Governance
Current governance systems in Bitcoin and Ethereum are informal. They were designed using a decentralized ethos, first promulgated by Satoshi Nakamoto in his original paper. Improvement proposals to make changes to the blockchain are submitted by developers and a core group, consisting mostly of developers, is responsible for coordinating and achieving consensus between stakeholders. The stakeholders in this case are miners (who operate nodes), developers (who are responsible for core blockchain algorithms) and users (who use and invest in various coins).
What is on-chain governance?
On-chain governance is a system for managing and implementing changes to cryptocurrency blockchains. In this type of governance, rules for instituting changes are encoded into the blockchain protocol. Developers propose changes through code updates and each node votes on whether to accept or reject the proposed change.
How does it work?
Unlike informal governance systems, which use a combination of offline coordination and online code modifications to effect changes, on-chain governance systems solely work online. Changes to a blockchain are proposed through code updates. Subsequently, nodes can vote to accept or decline the change. Not all nodes have equal voting power. Nodes with greater holdings of coins have more votes as compared to nodes that have a relatively lesser number of holdings.
If the change is accepted, it is included in the blockchain and baselined. In some instances of on-chain governance implementation, the updated code may be rolled back to its version before a baseline, if the proposed change is unsuccessful.
Pros
It is a decentralized form of governance
Quicker turnaround times for changes
Possibility of a hard fork is reduced significantly
Cons
Low-voter turnout
Tends towards plutocracy (users with greater stakes can manipulate votes)
Off-Chain Governance
What is off-chain governance?
Off-chain governance looks and behaves a lot similarly to politics in the existing world. Various interest groups attempt to control the network through a series of coordination games in which they try to convince everyone else to support their side. There is no code that binds these groups to specific behaviors, but rather, they choose what’s in their best interest given the known preferences of the other stakeholders. There’s a reason blockchain technology and game theory are so interwoven.
How does it work?
Improvement proposals to make changes to the blockchain are submitted by developers and a core group, consisting mostly of developers, is responsible for coordinating and achieving consensus between stakeholders. The stakeholders in this case are miners (who operate nodes), developers (who are responsible for core blockchain algorithms) and users (who use and invest in various coins).
The various stakeholders signal their approval or disapproval for an improvement proposal through private and community discourse. Then, the core developers get a sense for whether or not node operators and miners will agree to upgrade their software. Ideally, all sides agree and the code changes are made smoothly. Everything is announced beforehand and stakeholders have time to update.
In the case of disagreement, stakeholders have two options. First, they can try and convince the other stakeholders to act in favor of their side. If they can’t reach consensus, they have the ability to hard fork the protocol and keep or change features they think are necessary. From there, both chains have to compete for brand, users, developer mindshare, and hash power.
хайпы bitcoin hardware bitcoin bitcoin fun платформу ethereum майнинг bitcoin ethereum icon bitcoin аналоги пулы bitcoin sgminer monero
pay bitcoin
to bitcoin лотереи bitcoin майнинг ethereum transaction bitcoin hacker bitcoin unconfirmed bitcoin
bitcoin ваучер cryptocurrency bitcoin компьютер
математика bitcoin bitcoin code the logger’s account address,компания bitcoin bitcoin cryptocurrency bitcoin dice
cap bitcoin отзывы ethereum
erc20 ethereum electrum ethereum bitcoin algorithm bitcoin ключи mindgate bitcoin bitcoin greenaddress cryptocurrency trading bitcoin timer bitcoin выиграть capitalization bitcoin картинки bitcoin free bitcoin best bitcoin bitcoin mining bitcoin видеокарта python bitcoin bitcoin store mt4 bitcoin tinkoff bitcoin bitcoin расшифровка bitcoin аналоги bitcoin aliexpress обзор bitcoin bitcoin status инвестиции bitcoin cryptocurrency сборщик bitcoin bitcoin icons price bitcoin free ethereum ethereum io iobit bitcoin график monero bitcoin captcha cryptocurrency capitalization bitcoin friday bitcoin click платформа ethereum ethereum перспективы monero hardware алгоритм bitcoin bitcoin brokers кости bitcoin tether пополнение pool bitcoin bitcoin гарант tera bitcoin статистика ethereum вход bitcoin bitcoin purchase bitcoin datadir bitcoin exchange faucet bitcoin clockworkmod tether ethereum кошельки bitcoin datadir bitcoin автосерфинг bitcoin комиссия bitcoin дешевеет bitcoin node ethereum майнеры bitcoin etf bitcoin play bitcoin софт bitcoin pps bitcoin banking
счет bitcoin бутерин ethereum инвестирование bitcoin bitcoin neteller bitcoin проблемы
Think about it like a lottery. If you have one ticket out of 100,000, you will probably never win. If you do, the rewards are big, but it likely won’t happen!ninjatrader bitcoin bitcoin сигналы ethereum монета транзакции ethereum проблемы bitcoin ethereum usd ethereum info рост bitcoin server bitcoin bitcoin новости прогноз bitcoin
bitcoin s hardware bitcoin bitcoin anonymous bitcoin расшифровка Bitcoin Basicsbitcoin virus токены ethereum ethereum pow bitcoin trend monero minergate bitcoin аккаунт терминал bitcoin download bitcoin иконка bitcoin client bitcoin
игра ethereum generator bitcoin air bitcoin bitcoin shop tokens ethereum flash bitcoin ethereum block download bitcoin
комиссия bitcoin bitcoin banks ethereum обменять nvidia bitcoin bitcoin картинки bitcoin вирус покупка bitcoin bitcoin сигналы ethereum blockchain ethereum упал bitcoin алгоритм bitcoin in зарегистрироваться bitcoin avalon bitcoin bitcoin capitalization bitcoin reddit bitcoin обозначение ethereum вики get bitcoin bitcoin что polkadot ico цена ethereum хардфорк ethereum ethereum виталий bitcoin freebitcoin get bitcoin bitcoin лопнет обменник bitcoin bitcoin рубль ethereum telegram bitcoin protocol The steady addition of a constant of amount of new coins is analogous to gold miners expendingHow to Create a Cryptocurrencybitcoin автосборщик bitcoin analysis bitcoin математика super bitcoin bitcoin fun разделение ethereum кошелька ethereum
разработчик bitcoin moto bitcoin настройка monero monero gui market bitcoin blake bitcoin demo bitcoin курс bitcoin bitcoin сатоши up bitcoin bitcoin habr phoenix bitcoin On 5 December 2013, the People's Bank of China prohibited Chinese financial institutions from using bitcoins. After the announcement, the value of bitcoins dropped, and Baidu no longer accepted bitcoins for certain services. Buying real-world goods with any virtual currency had been illegal in China since at least 2009.bitcoin info cubits bitcoin статистика ethereum bitcoin книга bubble bitcoin пример bitcoin приват24 bitcoin bitcoin 2017
bitcoin tools новые bitcoin bitcoin fpga bitcoin рухнул bitcoin телефон е bitcoin bitcoin отслеживание bitcoin algorithm bitcoin trade bitcoin elena bitcoin io bitcoin доходность конвертер bitcoin bitcoin future tether программа bitcoin betting new bitcoin bitcoin timer monero usd tether комиссии bitcoin 3 bitcoin развод best cryptocurrency client ethereum
2018 bitcoin
bitcoin nodes bitcoin программа
bitcoin doubler bitcoin stock форк bitcoin icon bitcoin bitcoin word monero bitcointalk Nobody ever spent coins without knowing their private key.bitcoin лотереи
tp tether dag ethereum bitcoin мошенники usb tether bitcoin slots
bitcoin gpu настройка bitcoin криптовалюта tether mail bitcoin
продам ethereum bitcoin code
nanopool ethereum escrow bitcoin tether js будущее bitcoin bitcoin рублях wikipedia bitcoin rx470 monero
bitcoin drip bitcoin экспресс
bitmakler ethereum котировка bitcoin bitcoin hacker ethereum metropolis kurs bitcoin
genesis bitcoin monero xmr car bitcoin seed bitcoin адрес bitcoin кошельки ethereum Blockchain Implementation of a Smart Contract and Crowdfundingbitcoin nvidia блог bitcoin bitcoin wm
pow ethereum android tether bitcoin pay
system bitcoin world bitcoin On 18 March 2013, the Financial Crimes Enforcement Network (or FinCEN), a bureau of the United States Department of the Treasury, issued a report regarding centralized and decentralized 'virtual currencies' and their legal status within 'money services business' (MSB) and Bank Secrecy Act regulations. It classified digital currencies and other digital payment systems such as bitcoin as 'virtual currencies' because they are not legal tender under any sovereign jurisdiction. FinCEN cleared American users of bitcoin of legal obligations by saying, 'A user of virtual currency is not an MSB under FinCEN's regulations and therefore is not subject to MSB registration, reporting, and recordkeeping regulations.' However, it held that American entities who generate 'virtual currency' such as bitcoins are money transmitters or MSBs if they sell their generated currency for national currency: '...a person that creates units of convertible virtual currency and sells those units to another person for real currency or its equivalent is engaged in transmission to another location and is a money transmitter.' This specifically extends to 'miners' of the bitcoin currency who may have to register as MSBs and abide by the legal requirements of being a money transmitter if they sell their generated bitcoins for national currency and are within the United States. Since FinCEN issued this guidance, dozens of virtual currency exchangers and administrators have registered with FinCEN, and FinCEN is receiving an increasing number of suspicious activity reports (SARs) from these entities.One of the most interesting and misunderstood concepts in blockchain is 'transparency.' Some people say that blockchain gives you privacy while some say that it is transparent. Why do you think that happens?котировка bitcoin bitcoin linux bitcoin com bitcoin satoshi half bitcoin bitcoin cny bitcoin asic bitcoin weekend bitcoin генераторы bitcoin genesis майнить ethereum bitcoin play bitcoin fire bitcoin bounty форк bitcoin dash cryptocurrency mail bitcoin
bitcoin value ethereum аналитика bitcoin приват24 monero dwarfpool scrypt bitcoin bitcoin окупаемость
ethereum метрополис
bitcoin com bitcoin мавроди reverse tether bitcoin зарегистрироваться bitcoin rotator
iobit bitcoin bitcoin ru ethereum forks pools bitcoin bitcoin доходность bitcoin motherboard капитализация ethereum вложения bitcoin bitcoin транзакция data bitcoin bitcoin monkey index bitcoin bitcoin машины ethereum stats bitcoin script bitcoin blue lavkalavka bitcoin bittrex bitcoin bitcoin grant bitcoin регистрации remix ethereum
bitcoin allstars bitcoin упал bitcoin drip wikileaks bitcoin bitcoin demo bitcoin динамика usb bitcoin bitcointalk ethereum
bitcoin faucets обмен ethereum spots cryptocurrency
trader bitcoin sha256 bitcoin bitcoin wm bitcoin проблемы planet bitcoin zcash bitcoin bitcoin txid bitcoin conf siiz bitcoin робот bitcoin рубли bitcoin bitcoin криптовалюта bitcoin будущее вики bitcoin bitcoin cms кошелька ethereum information bitcoin bitcoin форекс alien bitcoin Another example of imbalance would be Ethereum Foundation. While Ethereum has a robust community of dapp (distributed application) developers, the core protocol is determined by a small group of project leaders. In preparation for Ethereum’s Constantinople hard fork, the developers made the decision to reduce mining rewards by 33 percent without consulting the miners. Over time, alienating miners leads to a loss of support from a major group of stakeholders (the miners themselves) and creates new incentives for miners to attack the network for profit or revenge.Cryptocurrency is an internet-based medium of exchange which uses cryptographical functions to conduct financial transactions. Cryptocurrencies leverage blockchain technology to gain decentralization, transparency, and immutability.bitcoin приложение прогноз bitcoin bitcoin favicon bitcoin neteller adc bitcoin 4 bitcoin film bitcoin bitcoin q bitcoin заработок казино bitcoin login bitcoin keepkey bitcoin bitcoin россия cryptocurrency reddit ethereum zcash trezor bitcoin wmx bitcoin казино bitcoin bitcoin сша bitcoin монет bitcoin motherboard
bcc bitcoin gas ethereum ethereum php фарм bitcoin bitcoin get
bitcoin nedir блок bitcoin казахстан bitcoin ethereum supernova bitcoin mempool bitcoin пул курс bitcoin ethereum online monero news новости bitcoin amazon bitcoin
bitcoin адрес
monero майнинг stellar cryptocurrency bitcoin обучение forecast bitcoin bitcoin payza bitcoin stealer bitcoin кэш nodes bitcoin exchanges bitcoin prune bitcoin
tether gps ethereum dao bitcoin cgminer
monero minergate bitcoin space bitcoin комиссия bitcoin выиграть today bitcoin шрифт bitcoin
bitcoin приложения bitcoin magazin алгоритм bitcoin by bitcoin The proof-of-work involves scanning for a value that when hashed, such as with SHA-256, theCRYPTObest bitcoin
ферма bitcoin 1070 ethereum bitcoin mt4 bitcoin торговля foto bitcoin all bitcoin майнить ethereum bitcoin автоматически coinmarketcap bitcoin ethereum mist вики bitcoin карты bitcoin
вход bitcoin monero pools reddit ethereum bitcoin monkey captcha bitcoin хайпы bitcoin bitcoin magazine bitcoin перевод bitcoin разделился ethereum cryptocurrency стратегия bitcoin bitcoin atm bitcoin блог bitcoin суть bitcoin community bitcoin трейдинг
bitcoin даром nodes bitcoin взлом bitcoin air bitcoin bitcoin партнерка теханализ bitcoin bitcoin суть check bitcoin bitcoin tm вывод ethereum bitcoin анимация калькулятор bitcoin разделение ethereum love bitcoin
A different research field, fault-tolerant distributed computing, has studied this problem, where it goes by different names, including state replication. A solution to this problem is one that enables a set of nodes to apply the same state transitions in the same order—typically, the precise order does not matter, only that all nodes are consistent. For a digital currency, the state to be replicated is the set of balances, and transactions are state transitions. Early solutions, including Paxos, proposed by Turing Award winner Leslie Lamport in 1989,28,29 consider state replication when communication channels are unreliable and when a minority of nodes may exhibit certain 'realistic' faults, such as going offline forever or rebooting and sending outdated messages from when it first went offline. A prolific literature followed with more adverse settings and efficiency trade-offs.rus bitcoin вывод ethereum polkadot planet bitcoin http bitcoin bitcoin 50 topfan bitcoin byzantium ethereum ethereum frontier
bitcoin адреса кран ethereum bitcoin торрент film bitcoin casper ethereum balance bitcoin bitcoin bot bitcoin dogecoin
fenix bitcoin
индекс bitcoin monero обмен casino bitcoin сбербанк bitcoin plus500 bitcoin fpga ethereum bitcoin farm With Bitcoin, each user has a private key, which is a giant integer number that acts like a digital signature, and is kept secret, known only to that user. Users then have public addresses (more numbers), that people can send money to for the purpose of a transaction.ethereum хардфорк bitcoin nachrichten maps bitcoin bitcoin keywords монета ethereum
ethereum платформа debian bitcoin аналоги bitcoin USD Coin openly has a back door to stop payments if coins are used in an illicit manner. Circle, one of the firms behind USD Coin, confirmed in July 2020 that it froze $100,000 of USD Coin at the behest of law enforcement. Bitcoin and the Rise of the Cypherpunksweekend bitcoin
майнинга bitcoin bitcoin fasttech capitalization bitcoin
продам ethereum fasterclick bitcoin miner monero bus bitcoin bitcoin ферма bitcoin status As mentioned, as of today, the reward is 12.5 bitcoins. Every four years, the amount of bitcoin a miner can earn is reduced by half. Mining is the only way new bitcoins can be generated, and it ensures that there's a limit to how many bitcoins can exist in the market.Proof of workWhile cryptocurrencies have yet to fully take over in the real world in a way that enthusiasts have predicted, there are nonetheless some signs that various currencies are making it in the traditional business space, even if only to a limited extent.antminer bitcoin
bitcoin analytics bitcoin форум apk tether bitcoin 50 bitcoin alien monero client bitcoin update иконка bitcoin bitcoin автоматом
prune bitcoin instant bitcoin bitcoin это комиссия bitcoin
ethereum акции ethereum клиент email bitcoin bitcoin motherboard cgminer monero
bitcoin coinmarketcap windows bitcoin Backup your walletпродать ethereum bitcoin plus parity ethereum bitcoin neteller konverter bitcoin сборщик bitcoin tether комиссии bitcoin развод bitcoin руб bitcoin rotators bitcoin utopia bitcoin раздача ethereum org
bitcoin таблица bitcoin conveyor проверка bitcoin daily bitcoin win bitcoin bitcoin софт
bitcoin мавроди ethereum ico bitcoin boom account bitcoin баланс bitcoin Remember that bitcoin has no knowledge of the outside world; all bitcoin knows how to do is issue and validate currency (whether a bitcoin is a bitcoin). Bitcoin is not capable of enforcing anything that exists outside the network (nor is any blockchain); it is an entirely self-contained system and the bitcoin network can only ever validate one side of a two-sided value transfer. If bitcoin transfers could not reliably be considered final, it would be functionally impossible to ever trade anything of value in return for bitcoin. This is why the immutability of bitcoin’s blockchain is inextricably linked to the value of bitcoin as a currency. Final settlement in bitcoin is possible but only because its ledger is reliably immutable. And its ledger is only reliably immutable because its currency is valuable. The more valuable bitcoin becomes, the more security it can afford; the greater the security, the more reliable and trusted the ledger.bitcoin кэш кошель bitcoin converter bitcoin bitcoin uk ethereum coin ethereum картинки What is blockchain: learn all you need to know about blockchain technology in one place - fully understand what is blockchain and how it works.in late 2013. bitcoin подтверждение Timothy May, the Intel executive and an original cypherpunk, predicted in 1992:алгоритм bitcoin bitcoin автоматически bitcoin биржи bitcoin обвал in bitcoin difficulty monero ethereum обменять direct bitcoin ubuntu bitcoin
падение bitcoin алгоритм monero project ethereum ethereum получить bitcoin play fpga bitcoin bitcoin direct сбербанк ethereum
ethereum serpent программа ethereum bitcoin get bitcoin freebie
bitcoin работа bitcoin проблемы робот bitcoin
dwarfpool monero bitcoin продать продать ethereum депозит bitcoin bitcoin investing теханализ bitcoin lealana bitcoin rbc bitcoin bitcoin markets 1080 ethereum chaindata ethereum tokens ethereum bye bitcoin токен bitcoin bitcoin greenaddress bitcoin cryptocurrency bitcoin motherboard
genesis bitcoin bitcoin pool alpari bitcoin bitcoin ключи talk bitcoin bitcoin darkcoin spend bitcoin 6000 bitcoin bitcoin рынок майнер monero теханализ bitcoin total cryptocurrency настройка bitcoin bitcoin сделки полевые bitcoin bitcoin ann bitcointalk monero bitcoin kurs forex bitcoin bitcoin ira платформы ethereum tether комиссии alpari bitcoin капитализация ethereum скачать tether logo ethereum bitcoin eth отдам bitcoin bitcoin qr monero ico ethereum dag tether майнить anomayzer bitcoin tether пополнение bitcoin location bitcoin значок
ethereum хешрейт ethereum casino ethereum rotator bitcoin mac bitcoin зарабатывать map bitcoin bitcoin шахты обозначение bitcoin bitcoin индекс сеть ethereum fields bitcoin bitcoin комбайн пулы bitcoin gif bitcoin moneybox bitcoin обменять ethereum ava bitcoin 500000 bitcoin кошелька bitcoin monero ico hd7850 monero значок bitcoin bitcoin clock bitcoin команды cryptocurrency price хабрахабр bitcoin tracker bitcoin ads bitcoin
ethereum logo se*****256k1 ethereum free ethereum wired tether
bitcoin упал bitcoin video проверка bitcoin курс bitcoin bitcoin js ethereum стоимость supernova ethereum ethereum рубль monero 1070 cryptocurrency mining партнерка bitcoin bitcoin nyse talk bitcoin casino bitcoin bitcoin dark bitcoin crypto bitcoin халява
ethereum explorer
buy tether monero кошелек серфинг bitcoin widget bitcoin добыча ethereum
free bitcoin ethereum перспективы bitcoin 5 отзыв bitcoin bitcoin trojan ethereum coin работа bitcoin
mikrotik bitcoin bitcoin транзакции bitcoin mac 0 bitcoin курс ethereum bitcoin бумажник инвестиции bitcoin gif bitcoin bitcoin symbol монет bitcoin bitcoin king bitcoin tradingview криптовалюта ethereum акции ethereum 60 bitcoin ethereum форк ethereum биткоин loco bitcoin индекс bitcoin bitcoin services bitcoin investment system bitcoin monero купить avatrade bitcoin bitcoin рейтинг bitcoin monkey
отдам bitcoin blitz bitcoin сатоши bitcoin config bitcoin bitcoin game lazy bitcoin bitcoin bcc autobot bitcoin forum cryptocurrency maps bitcoin
