Constitutions in protocol governance

Overview of constitutions in protocol governance

State of the art

Designs

We draw on defintions from The Constitutions of Web3.

Digital constitutions

Consitutions embed goals, values and rights.

See The Constitutions of Web3.

From the point of view of the protocol designer, goals and values allow shaping alignment.

Computational constitutions

These stem directly from smart contracts.

From the point of view of the protocol designer who has already launched a version of a protocol, such a computational constitution represent a constitutional state of affairs, from which to start from in further design efforts.

Embedding digital constitutions within on-chain governance

A notable approach is Constitution with escalation to decentralized court.

This is one of the features of The Lean Governance Thesis by Pocket Network.

Notable instances

Maker

Constitution allows things like committees and appeal.

Constitution is enforcemed via Arbitration, based on Committees (not courts, as far as the current version goes).

Optimism

Enforcement is unspecified.

ENS

Nothing on enforcement.

Pokt Network

See The Lean Goverannce Thesis.

GEV Analysis

Pros:

  • Creates determinism.

Cons:

  • Initial conditions have a lot of say.

⇒ Extreme GEV around when/how/who constitution is defined.

\textsf{GEV} = \textsf{Initial conditions} \cdot \textsf{all what can be defined in a constitution} \\ - \textsf{determinism} \cdot \textsf{all what can be prevented by a constitution}

Questions

Real-world legal relationships of digital constitutions?

Mostly none. Some examples like Ethereum World explicitly mention law.

Who defines the first constitution? How capturable is the definition process? Which goals is this optimizing for?

From the protocol designer’s point of view (see Protocol Governance in Protocol Design [TBD]), determinism is bringing maximum alignment, at the expense of rigidity.

From Nomic (Peter Suber):

Statutes cannot affect constitutional rules, but the latter can affect the former. This is an important difference of logical priority. When a conflict exists between rules of different types, the constitutional rules always prevail. This logical difference is matched by a political difference: the logically prior (constitutional) rules are more difficult to amend than the logically posterior (statutory) rules. That these two differences occur together is not accidental. One purpose of making some rules more difficult to change than others is to prevent a brief wave of fanaticism from undoing decades or centuries of refined structure. It is self-paternalism, our chosen insurance against our anticipated weak moments. But that purpose is not met unless the two-tier (or multi-tier) system also creates a logical hierarchy in which the less mutable rules take logical priority over the more mutable rules.