Blockchains and Governance: Interplanetary Database - BigchainDB & IPDB Meetup #4 - Mar 01, 2017
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Greg McMullen, president of IPDB.foundation talks about the importance of traditional vs. blockchain governance to run a decentralised organisation and database technology.
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Blockchains and Governance: Interplanetary Database - BigchainDB & IPDB Meetup #4 - Mar 01, 2017
- 2. Governance. We hear this word a lot. Every white paper seems to have a section on governance thrown in.
- 3. Why governance? But why? What does governance do for us that it has become important?
- 4. Accountability. The first reason is to provide a measure of accountability.
- 5. Accountability to participants. Accountability to the participants. Designing systems that allow input on the operations of the network. In blockchain models this is usually based on economic & game theory models.
- 6. Accountability to the public. Governance an also provide accountability to the general public - whether they are taking part in the system or not.
- 7. Responsiveness. The other piece is responding to various situations when they arise.
- 8. Responding to emergencies. Responding to emergencies. We’ve seen this in blockchain governance with the response to The DAO.
- 9. Responding to changing circumstances. But governance is also about responding to changing circumstances - making sure things still work in a new world. Bitcoin is struggling with this right now - inability to respond to increased demand and incentives that are out of alignment between users and miners.
- 10. Blockchain governance -vs- Traditional governance When I say blockchain governance, I mean: technocratic systems of governance that are largely based on-chain - DAOs, and to some extent Eth and Bitcoin. Traditional governance means alternative models: corporate law, administrative law, voluntary association, charities… There’s a lot of talk about wanting code to be law, getting rid of the lawyers, replacing vagueness with hard code.
- 11. Benefits of traditional? There are some benefits to traditional governance!
- 12. Out of beta. Traditional governance has been running in production for hundreds of years. That’s given a lot of time to stomp out bugs. It’s a legacy system but it’s extremely resilient.
- 13. Fault tolerant. Of course it’s not always perfect. But the system is extremely resilient. It handles exceptions gracefully and flexibly.
- 14. Interoperable. Traditional governance models are interoperable with every legal system in the world, and allow organizations to interface with all other traditional organizations through a protocol called contract law, which is also out of beta and has been used in production for about 2,500 years.
- 15. IPDB - for those who don’t know - is a public, scalable decentralized database with blockchain characteristics. It runs on a federated consensus model - so we pre- select the validating nodes. We’ve decided to run IPDB on Traditional Governance platform.
- 16. Legal personality. We are registering as a charitable organization here in Germany. That means we are able to enter into contracts with any other legal person. This is an advantage over DAOs.
- 17. Limited liability. Because it’s a legal entity, the members and board members of IPDB can take part with limited legal liability for the activities of the organization.
- 18. Accountability. As a charitable organization, IPDB’s mission statement will be legally binding. Supervised by the tax court - requires audited financial statements. Annual member meetings. Minutes of meetings are public.
- 20. Articles. Articles are law… and they are hard to change. Not immutable, but what is? 2/3 majority to change the articles. 3/4 majority to dissolve. Defines things like: Our mission statement. How the board is selected. Hard and fast rules about who can be a Caretaker. We’ve talked about this before but: all orgs, > 50% not for profit. Also requires that IPDB works toward dissolving. If it does its mission it shouldn’t be required anymore. A legal requirement that prevents us from getting too comfortable with the cushy jobs.
- 21. Here’s what IPDB looks like, as defined in the articles.
- 22. Caretakers. Chosen for commitment to decentralized internet. Articles require commitment to mission, > 50% not for profit…
- 23. Board. Elected by Caretakers. We’ll be announcing soon.
- 24. Staff. Hired by the Board to do day-to-day.
- 25. Advisors. Help steer and provide advice.
- 26. Bylaws. Easy to change. Super responsive. But very powerful. More flexible rules like: Process for selecting Caretakers. Rules about who can be a Caretaker - wish list for diversity. Processes for day-to-day operations. Processes for making policies around security, privacy, key generation and storage, etc.
- 27. Policies. Allow flexibility within structure with accountability to Board and Caretakers.
- 28. Total recall. The ultimate accountability mechanism. If the caretakers aren’t happy, they can vote to recall the board and replace em.