Governance Models (Pt. 2): Emerging Web3 Governance Models and the Future of Decentralization

In the first part of this series, we delved into the fundamental aspects of Web3 governance, exploring the predominant models and their relevance to the evolving digital landscape. Building on that foundation, we now venture into less-charted territories to examine other emerging Web3 governance models reshaping decentralized decision-making.

Quadratic Voting

This model is designed to address the constraints of traditional voting systems, where each individual can only express a binary preference on given issues. In Quadratic Voting (QV), individuals can use votes to indicate not just their preference but also the intensity of that preference. Essentially, each voter is allocated a number of credits, which can be spread across different issues based on how strongly the voter feels about them.

The cost of allocating multiple votes to a single issue increases quadratically, hence the name. This design encourages voters to prioritize the problems that matter most to them, leading to outcomes that align more closely with the collective preferences of the group. Though promising, QV can be sensitive to strategic behavior, and its adoption in the Web3 space will require mechanisms to ensure fairness and resist manipulation.


This governance model, proposed by economist Robin Hanson, envisages a system where elected officials define measures of national well-being, and prediction markets are used to decide which policies will best achieve those measures. In this system, market participants bet on the expected outcomes of proposed policies, with the policy predicted to have the most positive impact being implemented. Although it was first proposed in a broader political context, Futarchy has found relevance in the blockchain and DAO space, where it can be used to make data-driven decisions based on collective forecasting.

Future of Web3 Governance

As Web3 technologies mature and become more complex, their governance models must evolve. Various factors, including technological advances, shifts in user behavior and needs, and changes in legal and regulatory environments, will likely influence this evolution.

Given the current trajectory, it is reasonable to predict that future Web3 governance models will emphasize increased participation, transparency, and fairness. More nuanced models may emerge those blend elements of existing models to cater to specific use cases. Moreover, regulatory developments could play a key role in shaping the future of Web3 governance as policymakers and regulators around the world grapple with the task of crafting rules that balance the need for innovation with the need for consumer protection and market integrity.

Impact on the Broader Web3 Ecosystem

Developing robust and efficient Web3 governance models will have profound implications for various facets of the Web3 ecosystem, including DeFi and NFTs. These models will be instrumental in determining decisions in these spaces, such as how DeFi protocols manage risk, how NFT marketplaces curate content, and how revenue is distributed among participants.

In closing, the evolution of Web3 governance models is critical to the broader shift towards a more decentralized internet. These models offer innovative ways of making collective decisions, empowering individuals, and promoting transparency and accountability. As we continue to explore and refine these models, we stand to gain a deeper understanding of the mechanisms that underpin decentralized systems and how they can be designed to serve the common good.


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