One-Token-One-Vote

While simple, the 1T1V model faces significant critiques that challenge its fairness and effectiveness as a decentralized governance mechanism.

• Plutocracy: Voting power concentrates with the largest token holders, potentially marginalizing small stakeholders.
• Voter Apathy: Low participation rates are common, as many token holders are financially motivated speculators rather than active governors.
• Sybil Attacks: The model is vulnerable to Sybil attacks, where an entity splits holdings into many addresses to simulate broad support, though delegation can mitigate this.

The One-Token-One-Vote model is straightforward: one governance token equals one vote. This creates a transparent and easily auditable system where power distribution is directly visible on-chain. Stakeholders can instantly understand their influence and the total voting power of any proposal.

• Clear Rules: Eliminates complex delegation or reputation calculations.
• On-Chain Verification: All votes and token holdings are publicly verifiable, reducing trust assumptions.

This model directly aligns voter incentives with the protocol's long-term success. Token holders with significant skin in the game are financially motivated to vote for decisions that enhance the network's value and sustainability.

• Capital at Risk: Voters bear the direct financial consequences of their decisions.
• Sybil-Resistant: Acquiring more voting power requires a real capital expenditure, making it costly to attack the governance system.

Governance power is distributed according to a clear, immutable rule set by the token's smart contract. This predictability allows for stable long-term planning and reduces governance uncertainty for developers and investors.

• No Surprise Changes: The voting mechanism cannot be altered without a governance vote itself.
• Foundation for Analysis: Enables clear modeling of proposal outcomes based on known token holdings.

One-Token-One-Vote is the most common governance model in decentralized finance (DeFi), used by major protocols like Uniswap, Compound, and MakerDAO. This creates a familiar standard, reducing the learning curve for users participating across multiple ecosystems.

• Interoperability: Similar models across protocols make cross-protocol governance strategies more coherent.
• Proven Mechanism: Its extensive use provides a large dataset for analyzing governance behavior and outcomes.

While simple at its core, 1T1V can be the foundation for more advanced systems like liquid democracy. Token holders can delegate their voting power to representatives or experts without transferring custody of their assets, combining direct ownership with informed decision-making.

• Flexible Delegation: Users can delegate votes to different addresses for specific proposal types.
• Revocable Trust: Delegation is non-custodial and can be revoked at any time, preserving sovereignty.

A key advantage of 1T1V over One-Person-One-Vote models is its inherent resistance to Sybil attacks. In a permissionless, pseudonymous blockchain environment, verifying unique human identity is difficult and often centralized. 1T1V uses economic stake as a proxy for commitment.

• Sybil Resistance: Creating multiple wallets to gain votes requires proportional capital, making it prohibitively expensive.
• Avoids Identity Oracles: Does not rely on centralized KYC providers or complex proof-of-personhood systems.

A mechanism where the cost of additional votes on a proposal increases quadratically, diluting the power of large token holders. This aims to better reflect the intensity of voter preference.

• Mechanism: Cost = (Number of Votes)².
• Goal: Reduce plutocratic dominance by making it expensive for a single entity to sway votes.
• Example: Gitcoin Grants uses QV to fund public goods, where a donor's influence scales with the square root of their contribution.

A continuous voting system where voting power accrues over time as tokens are locked on a proposal, signaling stronger conviction.

• Mechanism: Voting power increases with the duration of a token lock.
• Goal: Surface consensus through sustained interest, not snapshot sentiment.
• Use Case: Commons funding in DAOs like 1Hive, where proposals need to demonstrate ongoing community support to pass.

A representative model where token holders delegate their voting power to experts or trusted community members.

• Mechanism: Delegates vote on behalf of their constituents, who can re-delegate or vote directly at any time.
• Goal: Mitigate voter apathy and increase decision quality via specialized delegates.
• Prominent Example: Compound and Uniswap governance, where delegates form a core voting bloc.

A futarchy-inspired model that uses prediction markets to inform governance decisions, aiming to surface the most economically sound outcomes.

• Core Idea: Proposals are paired with markets; the price of associated tokens predicts the proposal's positive impact.
• Goal: Align decision-making with measurable, forecasted success rather than pure sentiment.
• Pioneer: DAOstack implemented an early version to scale community coordination.

A permissioned model where a defined set of addresses (a council or multi-signature wallet) holds executive power, often used alongside token voting for checks and balances.

• Structure: A small group (e.g., 5-of-9 signers) executes approved proposals or handles emergency actions.
• Rationale: Balances decentralized voting with operational efficiency and security.
• Common In: Many Treasury management and protocol upgrade processes, such as in early-stage L2s like Arbitrum.

Governance models based on unique, non-transferable identity credentials rather than transferable financial assets.

• Mechanism: Voting power is tied to a verified identity or reputation, not a tradable token.
• Goal: Prevent vote-buying, enhance Sybil resistance, and align power with long-term participation.
• Concept: Proposed by Vitalik Buterin; explored in projects like Gitcoin Passport for sybil-resistant quadratic funding.