Ethereum community and its ecosystem: structural analysis - Kauri
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POSTED 20 Mar 2019 17:20

Ethereum community and its ecosystem: structural analysis

ethereum
ecosystem
community
analysis
governance
AUTHOR
Michael A

Ethereum community and ecosystem: structural analysis

Subdivisions inside a decentralised socio-technical protocol.

The different groups of participant and stakeholders from de Ethereum ecosystem doesn’t have the tools to understand the governance issue, they dont have the tools to signal their interest on blockchain governance, and are not even aware they are part of a group that have a power over governance decision.
One of the conditions for a crowd of peoples to become collectively intelligent and self-organized is when there is a clear distinction between members' activities and a specialization of activities.
Participants and stakeholder should indeed self-organised in order to signal their interest in blockchain governance but before a lot of work need to be done on the definition and categorization of the differents activities and specialties inside the Ethereum Ecosystem.

The De Filippi and Loveluck superstructure

According to De Filippi & Loveluck “the invisible politics of Bitcoin p.18” (2016) and reinterpreted by M.Rolland “Economie politique du Bitcoin” (2017). A Sociotechnical systems can not, because of their integration in a social and cultural context, ensure their own autonomy and self-sufficiency thanks to technology alone.”
There is a "superstructure" that would interact with infrastructure to address three critical issues: (i) define and protect the boundaries of its community; (ii) establish incentives for member participation and recognize status (iii) pacify conflict (Auray, 2012).
The superstructure is perceived by De Filippi and Loveluck as split into two distinct groups: The passive nodes (users), active nodes (miners) and that of some developers (core developers) capable to make direct modifications to the infrastructure of the network. These groups have their own boundaries and their own coordination mechanisms (incentive, protection, conflict resolution). This superstructure have been since re-evaluated by most of the actors in the Bitcoin ecosystem to incorporated the following distinction:

  • Inside the miners group, between the mining pools and the solo-miners (hashers).
  • Inside the users group between, active users who interact directly with the protocol (non mining/non profit-full/volontary nodes), and services providers (merchants, payment gateway, exchanges, wallet providers…) who use the protocol on behalf of passive users.

The idea behind this distinction is that there is a hierarchy among groups on the right of veto. Indeed mining pools have the power to choose the version of the protocol on behalf of it’s customer thus having more voting power than simple solo-miners. The same is true for services providers as they represented a large portion of the users of the protocol.
The protocol cannot then generate it’s own autonomy just by the mechanism of it’s technology, it need to find a consensus among all the social actors who use the protocol, we are thus talking about a sociotechnical system.

Decentralised socio-technical protocol with his own Constitution

The Bitcoin or the Ethereum protocol is a social equilibrium, it diffuses its authority through its social body and implements in a coercive way its decentralized consensus.
In a sense it even create its own constitution (Mark Alizart “cryptocommunisme” 2019), indeed a decentralized protocol like Bitcoin or Ethereum cannot evolve or improved without the agreement of the 3 powers (miners, developers, users) who constantly balance the system.
For Mark Alizart, Miners represent the judicial body, Developers the legislative body and Users the executive body in a system where everyone's surveillance by everyone.
I would like to improve this thinking by proposing the idea that each counterforce own a bit of each power.

Legislative body: It is an hybrid between technocracy, meritocracy and deliberative democracy. Everyone can write a proposal that change rules of the protocol but it is so complex that you need a high degree of expertise to make sure others people will review your proposal (in our case a computer code).
First your proposal need to catch the eyes of others, then has to be review and tested by different groups of peoples and with different context. Finally, after long debate and long consultation, developers deliberate on which proposal to be included on the next upgrades.
It is a technocracy because in this model mainly people with good long term reputation for skills and expertises get their proposal chosen.
A meritocracy because if you are good enough, you manage to prove and convince others that your proposal is beneficial, then it will be chosen disregarding of your social status, nationality or religion or if you are a miners or users.
A deliberative democracy because It adopts elements of both consensus decision-making and majority rule. It go through an authentic deliberation and not a voting system, as primary source of a law legitimacy.

Executive body: Born as a pure participatory democracy model, it has morphed into an hybrid between technocracy, oligarchy and delegative democracy.
Participants valid and enforce the rules created by the legislative and interpreted by the judicial body and then has the regalien task of protecting the protocol itself against internal or external attack.
Everyone can become a validator by committing a lot material capital and energy in the case of a Proof of Work algorithm consensus model (miners) or by committing financial capital in the case of a Proof of Stack (by sending a special type of transaction that locks up a crypto token produce by the protocol into a deposit).
It is open system on the surface but in reality you need high engineering skills (technocratic) and lot of capital resources (oligarchic) to participates, its a system who is mainly beneficial for the wealthiest but at the same times offer the possibility for everyone to participate and even the possibility to delegate you authority to someone else (delegative).

Judicial body: It is a mix between a delegative and participatory system.
Participants interprets and then applies or not the rules legislated by the Legislative body and enforced by the executive body. The main task of this body is to constantly monitor the protocol to make sure neither the legislative body nor the executive body introduce malicious and dishonest rules.
Among the 3 body it is probably the more democratic model because you need less resources or expertises to participates and you can delegate your power to someone else.
Members of this body are active users (voluntary full node owner and services providers) and indirectly passive users via delegation (with less power).

The beauty of a decentralized, open and permissionless protocol is that it allows participants to be a members of one governing body as the same times as to be members of another governing body.

Executives body members (miners) can create decree or executive order when they disagree with the legislative body (Bitcoin cash fork of the 1 August 2017). Usually if the system is well balanced, the consequences of an executive result in fork (a network split with 2 different constitutions).
Executives body members can also write proposal themselves so participate in the legislative body in order to help solving a political crisis situation.
The 22 may 2017 Pierre hillard chief engineer of bitmain (a major Chinese mining pool owner and manifacturer), members of the executive body, has wrote a proposal to change the constitution (BIP91) in order to end the scaling debate crisis.
In that particular situation most of the members of the executive body didn’t agree with most of the legislative and judicial body members on the rules to adopt in order to improved the Bitcoin protocol. Mr Hillard then short-circuited most of the prestigious developers and members of the legislatif body by imposing his rules which managed to convince firstly most of the developers, secondly a lot of users from the judicial body and most of his pairs from the executive body.

Legislative body members especially when the ecosystem around a decentralized socio-technical protocol is young and small can actively be member of the executive (be a miner or a validator) and of the judicial body (be an active full nodes owners).

Judicial body members, by deciding to apply or not the rules created and validated by the others two body, possesses a strong veto ownership.
They can influence the deliberative process of the legislative body ( they can choose when and which rules they are going to merge into the protocol).
They can also influence the validation process of the executive body (miners or validators) by signaling in advance that they will only interpreted or not and applied or not a specific rules of the protocol: ex (BIP 148) from shoaling fry. (BIP 148) from shoaling fry.
In the (BIP 148)situation, active users (full nodes) and passive users (customers of major and strategic services providers of the bitcoin ecosystem) where numerous enough to be able to signaled to the developers (legislative body) that this particular set of rules was popular among bitcoin users.
They have signaled to the miners (executive body) that if some of them would not validated this rules (BIP 148) then miners would find themselves with two different constitutions (a chain split), and therefore face significant losses in monetary values.
This collective power action coming from the judicial body has shown that the owners of full nodes have succeeded in defeating the plan to impose the change of the constitution in the favor of the executive body members (the miners).


The De Filippi and Loveluck superstructure adapted to the Ethereum Eco-system.
In this thought exercises, I have tried to transfer the subdivisions modeled by De Filippi and applied it to the Ethereum ecosystem.
In my opinion there is 3 majors types of participants: the Users, the Builders, the Holders. They participate in order to satisfy all different degrees of needs described in the previous article.

Builders: By builder (#BUIDL) I mean all the individual or groups of peoples who directly or indirectly help building, developing the core infrastructure of Ethereum and everything on top of it (DAPPS, tools and services).
We can characterise them as active participants of the network or 1 class citizen. They are the heart and soul of this open source and decentalised movements, some people consider them as being “the elite of the Ethereum ecosystem”. Inside this categories, subcategories can be found ex: subcategory specialised around security, around privacy, around interoperability, or around scaling and so on…..
In a Nutshell they are mainly developers, entrepreneurs, engineers, designers, security experts, researchers, computer scientists, academicians, hackers, tech and computer savy enthusiasts…

Holders: By holder (#HODL) We mean all the individual or group of people who directly or indirectly have a stake in the ecosystem. (in the form of private equity or in a form of crypto-tocken).
They are the speculators, investor and market maker of the world who bring resources (financial and material). It is common to find in this ecosystem Builders who are also Holders.

Users: The third category is less important in quality but extremely important in term of quantity. They are the individual or group of people who use the tools and services enable by the Ethereum platform.
We can distinguished 3 categories of users: actives users, non-profit actives users, for-profit actives-users and passive users. The first category actively interact and use the protocol, the last category use only services provided by the first category. In the blockchain world users have a reel influence on governance as they decide what type of software implementation they want to use (full node owners).

It would be interesting to found out if other members of this community have others categories or subcategories proposal or even have another definition of the superstructure than the one proposed by De Filippi and Loveluck.
Like Vlad Zamfir {EthCC2 governance panel} I also believe that the identification of stakeholders groups is very important for the governance of the Ethereum blockchain and for the developpement of legal and political voices representative of the different stakeholder groups.
Once the community managed to form a consensus on this matter* then we will also need to identified what their opinion are.
*(which is likely to evolve with time as the time as the protocol and the socio-demography of the participants)

AUTHOR
Michael A