EBGS — Episode 2: Administrative Governance and Decentralized Communities

Distributed Discretion

“Control over the implementation of policy becomes especially important as a source of bureaucratic power when it includes the authority to exercise discretion in achieving policy goals. As used here, the term “discretion” refers to the ability of an administrator to choose among alternatives — to decide in effect how the policies of the government should be implemented in specific cases.”

~Harold F. Gortner

Governance is a word much like politics, centralization and decentralization, power, discretion, and any number of extremely generalized terms which persistently maintain infinite meanings within constituencies that emphasize self-sovereignty.

So, before we discuss discretion, I first want to establish a definition for decentralization in terms of governance.

Centralization and decentralization refers to the degree to which discretionary authority is confined to the upper tiers of coordinating actors or assigned to the lower tier organizations and stakeholders making up a constituency. The upper tier administrators are those usually charged with the responsibility of implementing the collective decisions made on behalf of any constituency. These administrators are typically charged with this discretion because they have authority stemming from specialized knowledge and/or abilities.

If we are going to achieve a decentralized governance structure, we must not only enable inclusive and universally incentivized decision-making (coordination) processes, but we must also develop an administrative structure that creates a process of distributed discretion that is both transparent and reliable. The first set of procedures regarding collective decision-making have been aggressively pursued with imagination and experimentation, while the latter has barely been addressed.

It’s important to note that power imbalances will remain even if we become completely decentralized in process and structure. The gradient between the upper tier administrators and the lower tier organizations and stakeholders is simply the magnitude of discretionary authority (power) they are granted for displaying specialized knowledge and/or abilities. To equalize this, education should be embedded within every process of an administrative framework. Education can reduce the power imbalances by allowing for the expansion of reliable participants within the communities charged with administrative actions.

Decentralized Communities

This is where decentralized communities come into play. At the moment there are several communities within every platform that are communicating with each other in different ways and through the use of various online tools. For many platforms, true decentralization will require large communities to be relied upon to coordinate, contribute, and execute the collective decisions made regarding a change to the protocol. From this perspective, every community will dictate the success or failure of a project.

In our transition from a centralized world to a decentralized world, we should take careful notice to the rapidly changing environment of administrative governance as it pertains to the evolution of communities. Good administration requires the management of living communities. I use the term living because the nature of decentralization within a highly ‘mobile’ environment will result in communities whose demographics are constantly changing as new concentrations of unique individuals with different incentives begin contributing to the project; this evolution of decentralized demographics within a community has the potential to create instability and limit the cohesion of a projects purpose, direction, and culture.

The active management of these living communities will continue to be an extremely important function for all governance frameworks. Each protocol will have unique communities (platform developers, end-users, node-operators, investors, application developers, etc.) that contribute the human capital necessary for the protocol to operate successfully. Despite it’s logical importance, it surprises me how many projects disregard the management of this decentralized feature as secondary to other organizational functions such as marketing or PR.

There is an inherent power within truly decentralized communities; describing this power is difficult because we tend to think and act in a centralized manner (ex: foundations employing developers who have the discretionary authority to guide and influence the development of the platform, and who are compensated for their contributions directly), rather than in a decentralized manner (ex: a large reward granted (on-chain) to all developers within a network of ‘contributors’ — in response to the execution of collective administrative (on-chain) actions).

For developers, decentralization argues that the contributions from a great volume of perspectives and talents can outweigh the contributions created by a handful of internally guided, professionalized developers. This power of perspectives through volume — is an incredible asset of decentralization if it can be condensed, understood, and guided responsibly. However, this has yet to be seen.

This leads to the observation that there seems to be very few developers working hard on a platform who haven’t already shown interest in acquiring a job with said platform; or acquiring a job with a project using said platform. The individuals these projects tend to hire are individuals who display their superiority over others within the community of developers. They on-board them, possibly get them to move to a centralized office space, and let the rest of the developers within the community lightly contribute in abstract ways without taking the time to create a relationship through formal employment structures.

While this may be the case during the early stages of administrative development, on-chain administration will require the off-chain education of new developers and community members. Right now, the industry is heavily relying on the scarce human capital developed by prominent centralized institutions (MIT, Cambridge, UC Berkeley, Stanford, Harvard, etc.) who can afford to host programs that focus on distributed systems.

There is nothing wrong with this, but it accomplishes very little in our efforts to develop the human capital required for these platforms to thrive in a decentralized manner. The act of creating a system of distributed discretion requires the focused education of a large community of unique individuals, who are all capable of implementing collective decisions — individually, utilizing transparent on-chain functionalities and distinct off-chain processes that enhance trust between participants regarding the use of their hopefully unanticipated delegation of discretionary authority.

For this to occur, communities will need to develop methods of accreditation, and processes of evaluation. Off-chain processes such as education will become vital to the growth and stability of decentralized developer communities, and perhaps a process of certification through examinations or other unique on-chain processes could develop a transparent standard by which each platform approaches the governance of administrative delegation.

The individuals contributing to these communities will hopefully one day be compensated as employees, educated like students, and managed independently of other communities charged with separate, but coordinated, on-chain administrative functions. Creating these processes will allow for the professionalization of digital administration to take form; and as it begins to mature, it will start competing with other platforms for human capital.

Education is vital to the sustainability of decentralized communities and therefore it becomes a requirement for accountable on-chain administration.

Acknowledging Our Digital Divides

While we march forward in the development of the new internet, we should first realize we have still yet to build-out completely the infrastructure of the old internet. The digital divides that remain in our world are extremely vast. Many of you will regard the digital divide as simply those who have or do not have access to the internet.

INDIVIDUALS USING THE INTERNET — Source: https://www.itu.int/en/ITU-D/Statistics/Pages/stat/default.aspx CIS == Commonwealth of Independent States

As of 2017, it is estimated that 48% of the world’s population has used the Internet in some form [ITU]. This is a drastic improvement from just 10 years ago; despite this progress, most of the world’s population remains offline. This is problematic because vulnerable groups that lack access will fall further behind in an increasingly digital society.

Digital divides however, are much more complex than just access to the internet. Currently there are divides in language and content distribution. There are divides in useful uses of technology. There are divides in access between men and women; rich and poor. There are divides caused by bandwidth inconsistency from location to location. There are divides in the amount of produced content between countries and cultures. There are divides among the disabled. Divides between the young, and the old. There are divides in speed and efficiency. There are divides within our physical and intellectual infrastructures.

We need to recognize that these digital divides exist between nation-states and within nation-states; they grow in sometimes very unforeseen ways. If neglected, digital progress often becomes a catalyst to the creation of new digital divides that have significant consequences. For example, recently the United Nations referenced long-term studies that showed a strong correlation between digital exclusion and social exclusion of individuals around the world.

These divides compounded with our digital literacy issues can create significant obstacles to the scalability and adoption of distributed ledger technologies. These technologies demand large communities of people. Without participation from an inclusive and educated community, the success of projects within this industry will be extremely limited. If this industry wants to increase the rate of adoption around the world, it will need to collectively put pressure upon nation-states to aggressively address digital divides through national policies and infrastructural development.



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Nathan Suits

Nathan Suits

M.P.A./Geology/Political-Science/Microscopy. I am many things to many people, but I am first and foremost a student of the world. Education Matters.