Vitalik Buterin, co-founder of Ethereum, recently expressed his hope that Zcash – one of the pioneering projects on blockchain privacy – will move away from the Token based governance model. According to him, the “Token-based governance” form seems democratic but in fact has many loopholes that can undermine the core values that Zcash has been pursuing for many years, especially user privacy.
Buterin argues that the Token voting mechanism allows decision-making to be dominated by the “median Token holder,” a group that holds enough Token to influence the outcome but doesn’t necessarily have a deep understanding of the project’s technology or privacy philosophy. This, he says, could result in privacy standards being sacrificed for short-term economic gain. He notes that this model is even less effective than Zcash’s current governance mechanism, which was built to balance decentralization with protecting the project’s long-term vision.
This sentiment comes as the Zcash community has recently been debating the next steps for the network’s major upgrade, specifically XEM new governance models to attract investors and drive development. Some members have advocated adopting a Token voting model to increase transparency and create economic incentives, but Vitalik’s dissenting opinion has once again brought the topic of “is Token voting truly decentralized?” back into focus.
