The future of onchain mechanism design is expected to follow a dual-layer pattern, combining prediction markets with decentralized governance structures. The first layer involves a prediction market that is open and accountable, allowing participants to buy and sell based on decision outcomes, rewarding good decisions and penalizing poor ones. This market-based approach serves as a decentralized executive, providing a framework for accountability in a permissionless environment.
The second layer focuses on a decentralized, non-financialized preference-setting mechanism that maximizes intrinsic motivation and is resistant to capture. This layer avoids token-based systems to prevent centralization risks, such as a single entity acquiring a majority stake. Instead, it emphasizes anonymous voting, potentially using MACI (Minimal Anti-Collusion Infrastructure) to reduce collusion risks. This two-layer approach—execution through prediction markets and preference-setting through decentralized governance—offers a robust framework for future onchain mechanism design.
Future of Onchain Mechanism Design: Prediction Markets and Decentralized Governance
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