Hi fellow Meritians,
This thread is created in the archives as it is an elaborated example to the voting process for voting processes where the paradoxical voting is concerned. If you have not read the preceding thread of encouraging everyone to participate in governance, click here.
There is, however, an implication in a two-stage voting procedure. If we choose to go with scenario 2 in the preceding thread, then the first vote would determine whether the proposed issue is to be changed. People who vote against change in the initial vote will have their preferred option eliminated from the second vote since a change will occur either way. They now have a say in which choice it will be and will vote for their next-best option. This will ultimately influence the change that will be implemented and may paint a false picture depending who you ask. Allow me to illustrate using the below example.
Let’s say the use of proceeds is being discussed again. The author wishes to use an extra 10% of proceeds to buy back MC to use as staking rewards (for now, we disregard the fact where that 10% comes from). In the discussion, another individual would rather see that 10% burned instead of being allocated as staking rewards. The third option would be for no change at all to current use of proceeds. For simplicity, in this case there are three groups of people; stakers, holders, and naysayers.
Stakers (45% of the dao) would like to see the extra 10% of proceeds be allocated to staking rewards
Holders (35%) are in favour of burning the extra 10%
Naysayers (20%) prefer the way things are and would vote no.
Thus, the options are as follows.
A - An extra 10% of proceeds being allocated to buying back MC for staking rewards.
B - An extra 10% of proceeds being allocated to buying back MC and burning.
C - No revision will occur.
In scenario 1, the vote will have the options
A: Yes, revision of the use of proceeds. This option groups all those in favour of change; the stakers (45%) and holders (35%).
B: No, no revision of the use of proceeds.
This vote would determine the general direction of the DAO; yes or no change. The first vote would pass since 80% of the dao vote in favour of change. The vote that follows determines which revision is implemented. For the sake of this procedure and example, we assume all naysayers (20%) vote to burn the extra 10% from proceeds as they prefer it being burned to being distributed to staking. The subsequent vote would contain the options
A: An extra 10% of proceeds to buy back MC and be allocated to staking rewards.
B: An extra 10% of proceeds to buy back MC and be burned.
If all stakers (45%) would vote A, while all Holders (35%) and Naysayers (20%) would vote B, then the extra 10% of proceeds would end up being burned using this procedure of voting. Even though stakers represent the biggest group, the option for naysayers was removed and they chose their next-best option which ends up being implemented.
Whereas in scenario 1, with all options being voted on instantly, the options would be the following:
A: An extra 10% of proceeds being used to buy back MC to be allocated to staking rewards.
B: An extra 10% of proceeds being used to buy back MC to be burned
C: No revision to occur.
This scenario would spread votes according to the size of the aforementioned groups, thus
A: 45% - Voted on by all stakers
B: 35% - Voted on by all holders
C: 20% - Voted on by all naysayers
In this scenario, the extra proceeds would be allocated to buy back MC for staking rewards. This is due to stakers being the biggest group when judging options independently. All people voting no did not vote for their preferred revision as the option was not eliminated in a preceding vote.
Both scenarios have their upsides and downsides. The first scenario allows us to dissect complex topics into smaller parts which we can discuss separately. Each topic is decided by the majority and as such we will go forward as one dao with one direction. A more complex issue where issues need to be voting on separately can be seen here.
*This thread is placed in archives as it is just used as an example. Only if we move forward with an adapted process of proposals and voting will this become relevant. If it does, this thread will need a slight rework to stand on its own.