Why Quadratic Voting Alone Perpetuates Capital Inequality

QV's core defense against vote-buying relies on a costly identity proof, typically a financial deposit. This creates a capital gate for participation. The result is a system where influence is still a function of disposable income, just with diminishing returns.

• Key Flaw: Identity cost = financial barrier to entry.
• Outcome: Wealthy actors can still create multiple identities (Sybils) at a manageable cost, skewing outcomes.

Protocols like Optimism's Citizen House and Gitcoin Grants pioneer a model where reputation is earned via verifiable contributions, then used to allocate capital. This flips the script: governance power is a reward for past work, not a purchase.

• Mechanism: Retroactive Public Goods Funding (RPGF) allocates funds based on proven impact.
• Outcome: Creates a meritocratic flywheel where builders gain influence, not just speculators.

Non-transferable Soulbound Tokens, as conceptualized by Vitalik Buterin, aim to encode persistent reputation and affiliations. Projects like Gitcoin Passport aggregate credentials to score participation. This creates a social graph of trust separate from the financial graph.

• Key Benefit: Governance weight derived from verified actions and memberships.
• Challenge: Avoiding centralized credential issuers and maintaining privacy.

Implemented by Commons Stack and 1Hive, Conviction Voting weights votes by the duration tokens are committed to a proposal. This values patient, engaged capital over fleeting, mercenary capital. It's a step beyond QV's one-shot payments.

• Mechanism: Voting power accrues linearly over time a voter commits funds.
• Outcome: Discourages governance raids and rewards long-term alignment, though it still requires capital lock-up.

Proposed by Robin Hanson, Futarchy lets voters bet on measurable outcomes (e.g., "Will this policy increase TVL?") instead of voting on policies directly. The market price becomes the decision engine. This replaces opinion with capital-at-risk information aggregation.

• Key Benefit: Harnesses wisdom of crowds and financial incentives for truth-seeking.
• Challenge: Requires robust oracle infrastructure and well-defined success metrics.

DAOstack's holographic consensus uses a prediction market (GEN) to pre-screen proposals. Reputation holders signal, and predictors stake on which proposals will pass. This creates a scalable delegation layer where attention, not just capital, is efficiently allocated.

• Mechanism: Futarchy-lite for proposal filtering before full reputation holder vote.
• Outcome: Prevents proposal spam and surfaces high-signal initiatives through a stake-weighted attention market.

QV's core defense is identity uniqueness, but on-chain identity is cheap to forge. Without robust sybil resistance, whales simply split capital across hundreds of wallets to regain linear influence. This turns QV into a complex, expensive charade.

• Key Flaw: Assumes costless, perfect identity verification.
• Real Impact: Gitcoin Grants data shows sybil clusters can capture >30% of matching funds without advanced filters.

Most QV systems use token holdings (e.g., $TOKEN balance) for vote weighting. This directly ties governance power to wealth, creating a capital aristocracy. The 'quadratic' math only softens the curve; it doesn't break the fundamental link.

• Key Flaw: Confuses financial stake with expertise or community alignment.
• Real Impact: A $10M whale still has 100x the voting power of a $10k holder, perpetuating the VC/whale dominance QV aims to solve.

Break the capital-power link by incorporating non-financial signals. Systems like SourceCred and BrightID demonstrate that social graph analysis, proof-of-personhood, and contribution history create a more resilient governance base. Pair this with QV for final vote weighting.

• Key Benefit: Aligns power with proven participation, not just capital.
• Builder Action: Integrate Gitcoin Passport, Worldcoin, or Civic to build a sybil-resistant identity layer before applying QV math.

Mitigate capital flash attacks by requiring voters to express preference over time. Conviction Voting (pioneered by Commons Stack) lets voting power accrue linearly with the duration a voter supports a proposal. This favors patient, aligned capital over mercenary capital.

• Key Benefit: Time becomes a scarce resource whales cannot trivially buy.
• VC Insight: Back protocols that use time-locked veTokens (like Curve) or explicit conviction mechanisms to dampen plutocratic swings.

Instead of one-token-one-vote, require voters to irrevocably commit a portion of their tokens to a specific policy outcome for a fixed period. This model, seen in Radical Markets, makes governance power expensive and signals serious intent. Lost liquidity is the cost of influence.

• Key Benefit: Creates a skin-in-the-game mechanism that disproportionately burdens large, disengaged holders.
• Protocol Design: Implement via bonding curves or commit-reveal schemes that burn or lock capital for the vote duration.

Recognize that not all decisions belong on-chain. Use QV for high-level, slow parameter changes. Delegate fast, expert decisions to qualified committees (e.g., Security Guilds, Protocol Engineers) elected via QV. This separates signal (community QV) from execution (expert operation).

• Key Benefit: Prevents governance from becoming a low-information popularity contest dominated by whales.
• Architecture Pattern: Look to Compound's Governor Bravo or MakerDAO's core units as examples of delegated expert execution.