Staked weighted voting.
Is this is a good thing? Should the system be changed?
A lot gets made about this with people having strong opinions. Some believe this is an inherently unfair system that only rewards the wealthy. They feel that it leads to power plays while everyone else gets trod upon.
Whales are selfish and greedy. They only care about themselves.
This is what we are told anyway.
Certainly, some whales fit this description. Of course, it also should be pointed out many non-whales are also like this.
So what are we to make of this?
In this article we will dive into Hive's stake weighted voting and discuss some of the issues surrounding it.
Stake Weighted Voting
This is the core of Hive's governance system.
As we know, blockchain is bringing new governance models to the table. Some are just retreads of older ones, but in digital form. Voting is also seeing a makeover as technology allows for real time updating.
We see this in governance votes on Hive. Witnesses and proposals, the two major governance votes, are continuously ongoing. If a vote is removed, the tally is immediately updated. A witness can be part of the consensus one day and out the next.
There are no elections.
Also, unlike the system many are accustomed to, the value of one's vote is based upon the stake one has. As this increases, the weight does the same.
This is in contrast to one person, one vote. We see this in most government voting systems. Any individual has one vote to cast and it carries the same weight as anyone else in the country.
With Hive, that is not the case.
All Have Opinions
Everyone has opinions. The problem is most have nothing else.
As stated, under the one person, one vote idea, each has an equal impact on the voting system. The question is should this be the case?
On Hive, many feel that it should be this way. Why, after all, should those with more stake have a greater say? That makes them bullies and allows them to dominate others.
The challenge with this, to start, is the fact that one could set up multiple accounts. How do we know that someone is not casting 100 votes? The solution to that is identification which, obviously, goes counter to the tenets of cryptocurrency.
Aside from the lack of feasibility, is this a good idea in theory.
For those without any stake, the answer is obvious. They feel they should have say in what takes place and the system should be designed around them.
They do have opinions as we all know. However, what else do they have?
For the majority, not much else.
Ethereum Coin Voting
Ethereum adopted a coin voting system also. Their consensus mechanism is now based upon the total coin votes received. Essentially, this is stake weighted just like Hive.
This will serve as a great example of what the issue is.
I have an Ethereum account. Does that mean I should have the save vote as Vitalik? Certainly, I have views about what that network needs to do going forward. To add to the situation, I even have a full coin.
The fact that I am overlooked is inherently unfair.
Does this sound ridiculous to you? Or does it seem to make sense?
Let us go further.
Do I have the expertise to match Vitalik? I can have all my opinions about the path Ethereum needs to take but, to be candid, I am talking out my ass. I don't know the code nor have I really studied its tokenomics. My understanding of the system, and its flaws, are general in nature.
Another are of difference is in dedication. It is safe to say that Vitalik's commitment level to that network is much higher than mine. The time he spends focused upon that ecosystem is much greater than mine. Most often, other than looking at the price periodically, I pay no attention to it.
But I do have a coin and an account, so I should be on an equal footing with him.
Little Knowledge Or Dedication
Most have little knowledge and even less dedication.
Let's have a little test:
How many on Hive can explain one block irreversibility? Or how about Hive Application Framework?
These are not evident to most users. They are also not the most obscure of topics on Hive either. Nevertheless, I would venture to say that more than half the people regularly on Hive have no idea what at least one of these is.
Another point to consider is how many people have come and gone over the years. One of the problem with Witness voting is there are still a few that are run by people who are no longer on Hive. They left yet their nodes are still running and, some, are in consensus. Each month they are getting coins and selling them.
This is bad enough. However, what is everyone who had a Hive account at some point was able to simply cast votes even though they are not involved?
It is a situation that is somewhat offset by stake weighted voting.
If an individual splits but retains the holdings, his or her vote still carries weight. Unless this is a massively passive investment (or of little value), most will not do that. The majority, when they leave, end up selling their stake.
Get More Stake
When governance issues arise, it is funny to watch people complain. The usual calls come out in droves.
We hear how whales are selfish. They are greedy and Hive is centralized.
On and on.
Recently, there were a couple situations that arose.
The first is the upheaval over the APR paid on HBD in savings and the potential of this being changed. Like most things, there are opinions on both sides.
I wrote an article spelling my views out. This is an area I have a lot of research in. Some agree with what I wrote, others do not.
The bottom line is that, if something is done that you do not like, fix it. That means changing the governance make up.
We had the second issue with Leofinance submitting a proposal to the DHF. Like with the APR, there are views on both sides.
Under that situation, there were calls that the whales had to support it. Those that didn't were selfish and didn't care.
Again, rinse and repeat.
Fortunately, the Leo community can fix it.
The solution is always the same: get more stake. If the Leo community does not have enough influence to get past the return proposal, it needs to improve its position. This comes from more stake.
This is true for anyone. If you do not like what is happening, buy a million $HIVE and power it up. Don't have the money? Well that is how things go sometimes.
It is the reality of the world. Those who have no stake want say. It is like anything else: the ones with stake were lucky. Of course, the ones making this claim usually sold every coin that came into their wallet.
There is a thing called skin in the game. We should not presume that whales are the only greedy ones who will operate out of self interest. That covers most of humanity.
The idea that some who shows up one day, puts in no money, little effort, and is apt to leave at any time should have the same influence as one who has knowledge, expertise, and dedication along with a financial interest is absurd.
Yet this is exactly what we see happen. Obviously, is a reflection of an exaggeration of self-entitlement.
Is It Perfect?
Obviously, any system is going to be far from perfect.
With Hive, there are periods where things are adjusted. Sometimes this can be for the better but not always.
What Hive does offer is something very simple:
Governance requires skin in the game and the solution is to simply stake more if you do not like what is going on.
Any community that feels displaced can easily solve the problem by accumulating the stake to make itself known. If we take 5,000 people with 1,000 HP each, that is 5 million. Collectively, that is very powerful.
Sadly, most do not realize this. Those who complain it is unfair are the ones who have the ability to change their standing. Unfortunately, few understand percentages, instead focusing upon total numbers.
There is just under 170 million Hive powered up.
That means if one has 100 Hive Power, he or she have roughly 1/17M of the stake. However, if this person doubles it, to 200 HP, that grows to 1/8.5M. While it is a growth of 100 HP, it is a doubling of the influence on the network.
This might sound like nothing but the larger accounts are not going to easily double their size. It is very difficult to go from 100K to 200K HP. It can happen but requires either a great deal of time or a fair chuck of money.
When communities start to understand this concept and push their members to look at doubling their influence, then things change.
After all, there is a simple solution: stake more $HIVE.
