Abstract

Other Internet received funding from Uniswap Grants Program to conduct an ethnography of its Discord, with the goal of exploring how off-chain governance has evolved almost a year after the introduction of UNI. Our research was guided by questions such as: what are the barriers to greater user participation? How can the process by which informal ideas become official governance proposals be improved? What does it look like to have a treasury managed by a large group of users distributed across multiple platforms? How might collective decision-making work when each communication interface enforces its own unique norms and culture?

This is the first in a series of research reports on off-chain governance in the crypto ecosystem.

Supported by Uniswap Grants Program & Ethereum Foundation

Table of Contents

Introduction: Off-Chain Governance and Social Spaces

Crypto has made it possible to create applications that are owned and developed by a decentralized community of contributors. Anyone, anywhere in the world can access and participate in these open, borderless, and censorship-resistant apps without needing permission from a trusted institution at the center. By contributing resources to the network (e.g. computing power or storage space), participants can be rewarded with tokens that confer ownership in the network itself. A subset of these tokens also confer rights on community members — often the ability to “vote with their wallets” on issues like the design of the protocol and the disbursement of funds from protocol treasuries. These “governance tokens” are often distributed directly to early contributors and adopters.

As the space has evolved, many crypto communities have emphasized the importance and promise of on-chain governance. With on-chain governance, the rules for changing protocol parameters are embedded into the protocol itself. All decisions are brought to a formal vote, and community members use tokens to express their preferences. "Off-chain governance" typically refers to voting processes that do not trigger an on-chain protocol change, such as "signaling votes" or other forms of deliberation.

With all the focus on formal voting mechanisms, not enough attention is being paid to the design of the informal gathering places where discourse and decision-making take place. These cultural centers are the soil in which on-chain proposals and other meaningful contributions take root. We believe that the social architecture and organizational psychology of crypto community spaces deserves as much attention as formal voting systems. The conversational infrastructure (i.e. Discord channels, forum organization, group chat surfaces, etc.) that orders discussions is absolutely critical to the development of thriving virtual communities.

Discord servers have already become the de facto venue where people can learn about a protocol, meet community members and discover ways to participate in the network. Ideally, it is in Discord chats and forum debates that ideas for proposals are generated and developed through conversation and at time healthy disagreement. The informal exchanges that unfold through these channels are key for growing engagement and participation in a crypto community. ****Moreover, they are instrumental in attracting and identifying key stakeholders and contributors that otherwise would not be taken into account within a formal governance system — for instance, for not having enough tokens to meaningfully inflect voting processes. Thus, decentralized protocols should cultivate the spaces and conditions for generative informal exchanges alongside their formal governance processes.