Research on NGK governance mechanism
Governance mechanism is an important design of blockchain projects. With the operation of the project, the participants in the ecology need to update and upgrade the project as necessary according to the actual operating conditions, so that the project can continue to develop in a healthy manner. The function of the governance mechanism is to make different participants finally reach a consensus and directly determine whether the network ecology has the vitality of development. According to the different governance models, the governance mechanism of blockchain can be divided into off-chain governance and on-chain governance.
Currently, many blockchain projects including Bitcoin and Ethereum adopt off-chain governance. But there are many problems in off-chain governance, such as splitting, long governance processes, and so on. Compared with off-chain governance, all processes of on-chain governance occur on the blockchain, and projects are updated and upgraded through smart contracts. At present, there are many blockchain projects that adopt on-chain governance. The entire process of on-chain governance will be more transparent and orderly. At the same time, on-chain governance generally does not have any splits. NGK also adopts this kind of on-chain governance.
The foundation of NGK’s on-chain governance is the governance of tokens. The main rights and interests of NGK tokens include use rights, income rights and governance rights. Among them, the governance right is mainly reflected in users’ mortgage of NGK tokens to vote for nodes, and voting is the main way for users to participate in governance on the NGK chain. First, NGK adopts the DPOSS consensus mechanism. Users elect 21 super nodes and 100 candidate nodes through voting. Each NGK account can vote for up to 30 nodes. Secondly, users can participate in on-chain governance by voting and decide the future development path of NGK. The greater the number of users participating in on-chain governance, the higher the cost of the perpetrator, and the more secure the NGK network will be.
This kind of on-chain governance has played a role in promoting the development of NGK ecology, but at the same time, this on-chain governance mechanism may also have some problems, such as node solidification and low participation enthusiasm. This voting mechanism of NGK has a great opportunity to make participants who hold a large number of NGKs become super nodes. Although participants who hold a large number of NGKs are the biggest risk takers of NGK, they are consistent with the interest of the entire project. However, their excessive influence in governance will reduce the degree of decentralization of on-chain governance.
On the other hand, many participants in the ecology are more concerned about their short-term benefits. They will not vote based on the actual development of the project. Therefore, many participants do not understand the content of the proposal and unable to vote for development follow to the actual project. At the same time, users need to target NGK when voting, which increases the opportunity cost of users, which also greatly reduces the enthusiasm of participants to vote.
Since NGK uses the way that super nodes release by taking turns, there will be no diverges, but at the same time this may also affect the innovation and development of NGK. For on-chain governance, participants need to be financially motivated to prompt them in making choices which are beneficial to the project. From here we can see that NGK’s on-chain governance mechanism still facing with many problems of research, and participants need to iterate continuously to obtain the best solution.