Blockchain Governance in the Wild

Blockchain Governance in the Wild 2 Our work differs from the existing literature in three significant ways.Firstly, there has been very little comparative work among different blockchain networks or communities-what exists generally focuses only on Bitcoin and Ethereum at most.Secondly, this is not a theoretical study of potential successes or failures: We instead survey practical implementations, and governance development plans of specific projects.Finally, we do not examine only the governance decisions encoded on-chain.Our work expands to consider social norms, informal practices, and institutional governing entities associated with the project outside of the code.We believe this paper is the first to formally document and highlight the importance of informal governance structures within blockchain projects.The work of [8], which conducts a cross-sectional overview of the governance practices of 50 crypto projects, is most similar to ours in scope.However, it was conducted at a significantly earlier stage of market development.Moreover, their analysis focuses only on formally-codified practices (launch style, corporate support, network value), and does not contain the ethnographic component of informal practices that we capture in our survey.While the explicit rules of blockchain governance structures can be read from their software code or documentation, neither the code nor the documentation can tell us how those rules interact with more informal off-chain practices-practices which we aim to capture in our study.It should also be noted that these off-chain governance practices and institutions are of interest not only to academics and decentralization purists but also have a measurable impact on the pricing of tokens affiliated with a project [9].The approach of [10] is the most similar to ours in methodology, as the authors conduct interviews of eight experts to examine two projects, ETH and EOS.IO, through the lens of on-chain and offchain governance procedures.Unlike their work, we do not constrain our respondents to examine their governance through a specific lens; instead, we provide 20 broad questions and then group answers in postanalysis described in the following section. Governance Analysis History of Blockchain GovernanceBy their nature, blockchains can replace top-down, centralized guarantees provided by one trusted authority with decentralized forms of trust based on economic incentives and cryptographic proofs.While it may seem that decentralization eliminates the need for governance, this is not the case.Even Bitcoin, designed to be fully decentralized and "trustless," has a governance regime with distinctive norms, procedures, and powerful actors [11].The continuing evolution of blockchain governance is a natural consequence of experimentation.New blockchain platforms and protocols take stock of existing ones, incorporate their learnings, and seek to improve on them.Governance practices and mechanisms also evolve in response to controversies, which highlight limitations of current approaches.