How Cosmos is making blockchain governance work

Blockchain governance is hard to pull off. The EOS platform for instance uses a voting mechanism to determine how the platform evolves. The problem? Hardly anyone can be bothered to vote on issues of importance, such as removing the high rate of inflation. Voting turnout peaks at just 2.5 percent of the network.

- Advertisement -

That could have created an existential crisis since its constitution required a minimum turnout of 15 percent. But the requirement was ultimately scrapped when it became clear voter turnout would fall so far short.

In contrast, Cosmos—which recently burst into the top 20 coins by market cap—seems to be making it work. It is a protocol for building proof-of-stake blockchains built on Tendermint software. It hopes to make it easier for developers to build blockchains for applications they are working on. It has its own token, called ATOM.

Tendermint is a for-profit company that builds blockchain software and is responsible for the development of Cosmos. Christine Chang, director of Tendermint said Cosmos has a constitutionally mandated quorum of 40 percent turnout but that, typically, around 90 percent of stakers vote.

So what’s working so well here?

Chang said that building a proof-of-stake blockchain required a highly engaged community from the start. The project was so challenging that everyone had to communicate regularly via chat groups and other means of communication.

“Everyone wants strong ownership of what’s happening to the network. If you’re an active participant you decide the fate of the network,” she told Decrypt.

- Advertisement -

In fact, she pointed out that the governance system had to reach a fairly high level of engagement to activate the network in the first place. The entire community was incentivized to participate in the first few votes—and that created a kind of habit, putting them in the right mindset to continue voting.

Chang said, “For one month, everyone was talking about ‘are we ready to enable ATOMs?’ Then the moment the proposal came out, everyone showed up, saying, ‘let’s enable this, I want to trade my ATOM’s’.”

So, the trick is to get governance in place before the token sale, not after.

- Advertisement -

Source

Previous Articles:

- Advertisement -

Latest

American Engineer Drugged, Robbed in Sophisticated London Crypto Heist

An American software engineer lost approximately $123,000 in cryptocurrency after being drugged and robbed in London.The victim was targeted by an impersonator posing as...

Max Keiser Doubts New Bitcoin Treasuries’ Discipline in Bear Market

Bitcoin-focused companies are increasingly copying the treasury strategy used by Michael Saylor's Strategy.Max Keiser raised doubts about whether these newer companies can maintain commitment...

South Korea Election Puts Crypto Policy at Center of Debate

Nearly one-third of South Koreans hold digital assets, making crypto a vital issue in the upcoming presidential election.Both major parties support crypto exchange-traded funds...

Scottsdale Residents Lose $6M to Crypto Scams; Police Respond

Scottsdale residents have reported losing over $6 million to cryptocurrency Scams in 2024.Authorities say actual losses could be higher, as not all cases are...

Ethereum Bullish Patterns Signal Altseason, 55% Rally Possible

Ethereum is showing two bullish chart patterns against Bitcoin, indicating a possible 30–55% price increase. Crypto analysts say an ETH/BTC rally could spark a broad...

Must Read

Top 7 BEST Crypto Trading Bots for Beginners

QUICK NAVIGATIONQuick Look: Top 3 Best Crypto Trading BotsWhat Exactly is a Crypto Trading Bot?How I Chose These Trading BotsTop 7 Crypto Trading Bots...