‘Proof of Stake’ is Not the Way (to govern the “Proof of Brain” tribe)

As we continue this ‘experiment’ known as the “Proof of Brain” tribe, it is now abundantly clear that ‘Proof of Stake’ governance is not the way.

The two ‘anti-downvote-abuse’ proposals I put forth a few weeks ago for public scrutiny and ‘Proof of Stake’ voting (1, 2) produced some great dialogue, debate, and engagement. As such, I am in no way regretful of having put so much time and energy into that.

One of the best responses I received was from Hive account@clixmoney who wondered aloud why we are relying upon ‘Proof of Stake’ to govern a tribe whose stated ethos is ‘Proof of Brain’. I couldn’t agree more!

And plenty of folks, like Hive account@antisocialist, were simply against adding ‘rules’ to a platform that is supposed to be about decentralization and freedom. Again, I have a hard time arguing against that mindset.

Some, like Hive account@scooter77, asked “why not just remove downvoting all together” from the Proof of Brain tribe?. Apparently that’s really easy to do. I’ve also been told that it’s equally easy to reconfigure the tribe’s token so that downvotes use upvote mana (i.e. each downvote would ‘cost’ the same as an upvote, instead of being free).

However, others such as Hive account@themarkymark have argued that removing downvoting altogether (or even just making them ‘costly’ instead of free) could impair the tribe’s ability to combat plagiarism and spam.

And then there’s Hive account@onealfa, who threatened (or promised?) to intentionally spam the Proof of Brain tribe if downvotes are eliminated or curtailed:

if enough (50+%) ppl vote now to prohibit downvotes on overvalued rewards. If this happens, I will go to my next door neighbour, active photographer, who is still posting his photos on steem/appics, will tell him to come back to hive & POB, and will put him on my autovoter.

We will play by rules, no plagiarism, no NSFW, nothing unauthorized.I wonder under which excuse "antidownvoters" will stop us.

We also have Hive account@interpretation, who called attention to the fact that

Hive account@onealfa.pob which is the biggest investor of the #pob tokens threatened to ignore the user who support the [anti-downvote-abuse] proposal

to which Hive account@oneafla then replied:

And if I cut completely my support to these people [who vote “YES” on an anti-downvote proposal] - would it be better for them to know in advance this change in my support, or it would be better for them to find this as an unpleasant surprise?

So, there you have it.

That last comment by Hive account@onealfa makes it abundantly clear to me why governance of this tribe CANNOT and SHOULD NOT proceed based on any sort of ‘Proof of Stake’ governance model. When you have a whale who is on record stating that he will effectively ‘punish’ content creators who vote in a way contrary to his wishes (and no way for them to vote via secret ballot), you have a system that is broken and cannot be relied upon.

As such, I doubt that you will see any more formal proposals from me regarding changes to the Proof of Brain tribe. Rather, until some reputable and reliable governance model is adopted, you will just see regular old posts from me with arguments presented (and debate and dialogue invited) in such a way that the tribe founder (Hive account@proofofbrainio) can listen to the arguments and counter-arguments, read the tea leaves (of public opinion), and then decide the best course of action to take, (much the same way a CEO decides what products to make, in hopes of attracting customers by providing them something they genuinely value).

As Hive account@themarkymark pointed out a few weeks ago in his excellent post about Hive-Engine tokens, investing in a Hive-Engine token involves a lot of risk, because, the way H-E is structured, whomever controls the token’s issuing account pretty much controls it all. In other words, even if an elaborate ‘decentralized’ governance system is put in place, it doesn’t really mean much, because the issuing account has unilaterail power to change pretty much anything and everything, at the drop of a hat.

Does this ‘centralized power’ of the Proof of Brain token and tribe bother me? Sure.

But, as Hive account@themarkymark pointed out, this is a ‘feature’ associated with all Hive-Engine tokens, and should certainly factor into every individual's decisions about whether or not to invest their time and treasure into any particular tribe (and token).

So, let me spend a few moments explaining why I remain fully invested in the ‘Proof of Brain’ token and tribe (and plan to stay that way).

My initial interpretation of the Proof of Brain white paper (as in, my impressions and ‘takeaways’ the first time I read it), was that the founder would not be taking any founder’s fee or initial token distribution, and that 100% of the tokens accumulated by the tribe’s founding account (Hive account@proofofbrainio) would be used to advance the tribe itself (e.g. to further develop the front-end, etc.).

This interpretation was shaken a bit when a new account was created on 4/7/21 (Hive account@pob-fund) and then publicly announced in a post on 4/8/21. With that change, it seemed like maybe the founder was claiming for himself the tokens that had accumulated into the Hive account@proofofbrainio account and the tribe would only benefit from the tokens in the Hive account@pob-fund account. Thus a question-mark began (in my mind) when this second account was created, and that question-mark grew larger when the beneficiary of the 10% ‘tax’ was switched from Hive account@proofofbrainio to Hive account@pob-fund, on 4/16/21.

I tend to give “the benefit of the doubt” to people and, as such, I chose to keep my concerns to myself and decided to just ‘wait and see’. However, I abandonded that ‘wait and see’ approach when it came to my attention (on 6/22/21) that the beneficiary of the 10% ‘tax’ had been switched back to Hive account@proofofbrainio (on 6/3/21), with no public announcement of the switch. Some folks on the Discord server jumped on that ‘secret switching of accounts’ and said “Aha, the tribe founder is hijacking the tribe and its token for his personal enrichment” and much Discord drama ensued [cue jokes and memes about ‘Proof of Drama’].

Rather than jump on the accusation bandwagon, I decided to simply ask Hive account@proofofbrainio up front regarding whether my initial interpretation was correct (i.e. that 100% of the tokens in the original Hive account@proofobrainio account were meant for the exclusive use of tribe development and NOT for the founder’s personal gain).

My reason for asking this question was straightforward. If my original interpretation was correct, then switching the beneficiary from one account to another would be akin to a bookkeeping change -- i.e. instead of the ‘company’ revenues going into ‘Development Account B’ they will be going into ‘Development Account A’.

Here was my question (presented on the #general channel of the public ‘Proof of Brain’ Discord server):

And here was Hive account@proofofbrainio’s response:

Every interaction I have ever had with Hive account@proofofbrainio (and I have had a lot, starting on about Day 3 of the tribe’s existence) has left me with the same overall impression -- he had an idea that he thought would improve the distribution of ‘proof of brain’ rewards and would thus be beneficial to the Hive ecosystem and to society in general, he decided to invest his own time and treasure to launch the idea, and for whatever reason, he has decided to remain completely pseudonymous (hmmm, where have I heard that before ... ?).

‘Proof of Stake’ Decision-Making is NOT Decentralized Decision-Making

I’ve said this elsewhere, and I’ll say it again: ‘Proof of Stake’ voting is not decentralized decision-making. In fact, it’s really not even close. It is essentially a centralized decision-making process wrapped in a decentralized veneer.

In fact, I would argue that the term “decentralized decision-making” is a misnomer. In a truly decentralized system, there are no centralized decisions, period. In other words, if a single, overarching decision needs to be made, such as choosing whether or not to commit X amount of HBD from the ‘Decentralized Hive Fund’ to support a specific project, then that simply cannot be done in a truly decentralized fashion. The are no central decisions or central plans in a truly decentralized society and economy.

F. A. Hayek, in his seminal paper on The Use of Knowledge in Society explained how local (i.e. individual) knowledge is the key to decentralized ‘decision-making’ (again, it is not really decision-making, in the normal sense of the term). Furthermore, the real beauty of a truly decentralized ‘system’ is that no active collaboration, cooperation, or agreement (express or implied) is required. No ‘consensus’ is required. No ‘voting’ is required (other than voting with your sneakers). All that is required is for individuals (lots of them) to be free to act on whatever information each has knowledge of, in fulfillment of each individual’s personal preferences. And, the basic assumption is that each individual will act in a way that is consistent with his/her best interests (and also in accordance with his/her local knowledge).

That’s it! The key to true decentralized decision-making is a competitive market where individuals are free to choose from a diverse offering of goods and services. Translating that to the Hive ecosystem -- we needs LOTS of Layer 2 solutions (tribes, tokens, dApps, front-ends, etc.) each competing for the time and attention of individual users -- that’s true decentralization. That is what Hive account@taskmaster4450 was getting at when he published this post about Hive needing 10 ‘Splinterlands’. Obviously he was not referring to 10 mere clones of Splinterlands. Rather, he was referring to the fact that Splinterlands has successfully created and delivered value to a whole new group of people and, in so doing, has onboarded a record number of users over the past week or so. Hive needs 10 more Layer 2 ‘solutions’ that achieve that, or something similar.

(With all that said, it is worth noting that, in the absence of true decentralization, a DPoS-based system, like Hive, where no single individual or entity controls more than 5% of the stake is probably about as good as can be hoped for, in terms of ‘decentralized governance’. As such, when it comes to blockchain governance, I know of no current system that is superior to Hive -- that is one of the reasons I remain extremely bullish about Hive.)

Conclusion

The vast majority of all Layer 2 solutions are and will be highly centralized, and that’s completely okay. Some may experiment with alternative forms of ‘decentralized’ governance, and that’s okay, too.

The governance mechanism of an individual tribe is mostly irrelevant. What is relevant is the extent to which any given tribe (or dApp or other Layer 2 solution) is able to deliver genuine value that attracts lots and lots of individual users.

In closing, although I am okay with the “Proof of Brain” tribe experimenting with alternative forms of governance, I am wholeheartedly against ‘Proof of Stake’ as a governance method. As stated above, the fact that whales are able to influence voting via threats (whether stated or implied) makes any and all forms of PoS governance at the tribe level untenable, imo.

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