With 99% approval rate and above 70% participation, the Dash community has voted to implement a decentralized governance and funding system based on their full node network.
In Dash, full nodes (masternodes) are required to have a collateral of 1000 DASH for the node to operate, provide multiple services and earn Dash in return alongside miners. The collateral helps secure the network as it prevents malicious parties to create nodes for free.
Through this network of full nodes and the collateral requirement, Dash already counts with a decentralized network of masternode operators that are invested in the future of the currency and that, as a group, can act as stewards of the core protocol development and promotion. These people, come from multiple locations, jurisdictions and backgrounds but are all invested in the network, making them the ideal assembly to vote on projects and initiatives to grow and develop the Dash ecosystem.
Based on this, Dash implemented a voting mechanism where each full node represents one vote. The votes are propagated through the network and can be verified by any interested party. This ensures a decentralized way of managing the Dash project as there are potentially hundreds of operators that can take decisions together in a very practical way.
Additionally, the masternode operators agreed to dedicate 10% of the block rewards to fund this program. These funds were originally planned as additional incentive for masternodes but instead this assembly of operators will help reinvest these funds by voting on development and promotion initiatives that can be proposed by anyone in the community.
There will be websites where any person can present a potential initiative to be funded, explain why it is important for the development and growth of the Dash ecosystem and include the required budget for its execution. The proposal managing websites will simply have access to a masternode, so they will have the capability of drafting and submitting new budgets to the network. This system is designed to be 100% decentralized and is built around the idea of storing all important initiative and budget information on the network itself. The proposal websites can run independently of the network, but still interact with it, similar to blockchain explorer websites. After a budget has been submitted to the network, masternodes can vote on it.
Having a well-defined way to vote on important topics will allow the community to remain cohesive as it faces a highly dynamic environment that requires crypto projects to often make hard decisions on direction and ensure these decisions are made in a timely way.
This system of decentralized governance and funding will also make the Dash project more agile and allow it to retain its financial independence and grow organically without relying on third party interests for sustenance.
We envision a future in which this model of transparent, unbreakable and verifiable contribution to the common good, in combination with continuous participation of the crowd through active voting, is utilized to manage organizations that are owned or ran jointly by its members, who share the benefits and responsibilities of those collectives, like governments, cooperative corporations, unions, DAOs, crypto-currencies, etc. We are calling this model, decentralized governance by blockchain.