Do you think that a DRep's voting power should be capped?

As an active DRep I feel that having a cap on a delegated representative’s voting power will be a positive catalyst for keeping influence distributed, and allowing room for greater inclusion and participation.

I’ve launched a poll on the Tempo tool that will be active between Jan 30 2025 and March 30 2025. I’ll use the data gathered to support submission of a CIP that officially makes a request to add this cap to the Cardano core.

Your voice is important and your participation in the poll is encouraged and appreciated. Please also share this poll where you think Cardano supporters will be likely to add their voice to the results. Thanks!

POLL LINK BELOW

Please also feel free to add comments to this thread - do you feel there should not be a cap? Do you agree ther should be a cap? And why do you feel the way you do?

5 Likes

Thanks for putting this up. I am surely going to submit my view on the poll as a DRep as I have genuine interest in this topic.

I did checkout the poll, and your options seem too close. In my view, a possible cap should be set at 50M ADA. Maybe your options for this particular should just be a Yes or No. Then we can later think of what values to consider if the output for this particular poll suggests, “Yes, there should be a cap.”

What do you think? @Quoia75

3 Likes

Not sure.

With stake pools, we have that it is not forbidden to have more than the saturation as delegated stake, it is “just” discouraged by very sharply declining rewards. How would that work for dReps? Sure, we could do a hard cap. But, the delegators maybe just don’t care if they don’t have any disadvantages from delegating to a capped dRep. It could maybe even be a permanent argument against: “Look, this dRep has 15 million ADA delegated on-chain, but they can only vote with 5 million ADA. Isn’t that unfair?”

For pools, we have multi-pools. Could it happen that we also just get “multi-dReps” then? After all, registering as a dRep is permissionless and just costs 500 ADA deposit (and I hope it stays that way).

Do we have enough people of all directions that everybody can still find a non-capped dRep to delegate to?

3 Likes

Thanks for replying Nana, you’re feedback is exactly the type I’m looking for.

The poll doesn’t allow me to edit it, so I will let it run and see what data is generated.

Since this poll is unscientific, I’m ok with it being driven by sentiment rather than hard math just to foster discussion. For example, more votes for the lowest number may indicate that the community feels strongly about lowering DRep’s individual power. More votes for the higher cap can indicate that the community is comfortable with having higher limits for DReps. And of course, a “NO” vote = no limits.

A rough estimate is that we currently have 800 registered DReps and only 12% of the circulating ADA supplied delegated.

Using these numbers, capping DRep voting power at 5 million ADA would mean a equal distribution of voting power to around 850 DReps.

At this point we are barely scratching the surface of participation this early in governance (exciting times ahead!) but I truly hope as the Cardano ecosystem continues to grow, more delegators will mean more DReps, or even delegators choosing to become educated voters themselves, which in my opinion is even more ideal.

1 Like

Thanks for your feedback Sean.

Maybe having a flexible approach such as implementing a saturation point is the better option?

Kit Willow shared a recent X Spaces discussion with me where this was mentioned. You might find it interesting => DRep Growth Space.

After listening, I’m in agreement that hard caps may not be the exact answer, but that there should be some approach to limiting the potential for a few key players to amass centralized power.

Since compensation for DReps is currently a subject being considered, maybe saturation points could be implemented in a way that incentivizes both DReps and delegators to support decentralization. Maybe both parties earn less once the saturation point is reached?

I’m not a SPO operator, but I have seen sentiment that goes both ways as far as “multi-pool” entities. I’m not aware that a satisfactory solution has been found to discourage single entities with multiple pools (Binance) but I imagine the same thing is likely to occur within the DRep atmosphere. It’s one of the reasons I have reservations about DReps being paid, but at the same time, I understand that incentives drive better outcomes.

As far as there not being enough DReps, I also agree with this and I don’t think that a meaningful conversation around limiting DRep voting power can be had without also considering how best to market Governance to Cardano participants so that they WANT to participate more deeply.

1 Like

This is where the brainstorming becomes real. I love these questions.

4 Likes

Hi Nana,

Thanks to the Related Topics widget at the bottom of this post, I can see that you discussed a version of this topic just a few months ago: Delegation Saturation for DReps?

Based on the conversation and poll results, it looks like a consensus was reached that 50 million ADA would be an acceptable saturation point for DReps’ voting power, with no cap desired on the actual number of possible DReps. It would have been great to have seen more community interaction in that discussion. :pray:

I would love to get some momentum behind this idea with the intention of turning it into an official CIP.

Do you know of any obstacle that may make this goal difficult/impossible to achieve now that we have officially crossed the Plomin Hardfork stage? Are you aware of any specific actions that are being taken to advance the idea of a DRep saturation point since the topic was posted back in October?

1 Like

Low community participation, both in these discussions and in actual governance (through ADA delegation), is a major issue. Regarding the 50 million ADA cap, while it appears to be an arbitrary number without scientific backing, it still seems reasonable to me (and yes, I agree with this cap).

Another point I’d like to highlight concerning participation is the common narrative we often hear: ‘It’s still very early’ and ‘delegation numbers will go up.’ While this is true, time is passing, and at some point, this narrative will no longer be valid. I would be interested in seeing a comparison of adoption curves between initial SPO delegations and DRep delegations. It would be particularly interesting to see if staking rewards as incentives may have motivated people to delegate to SPOs faster versus DReps.

1 Like

Good question! I personally think that there should be a saturation point as with the SPs.

1 Like

Thanks for adding your voice to this discussion Kostas. I’m in agreement with you that participation in Cardano besides passive staking is relatively low, especially in these Cardano forums. Do you have any particular thoughts on how to turn that around?

At this point in crypto adoption, I think most see it as a casino. What blockchain can do for society beyond enriching a small cadre of early adopters is mostly ignored. It doesn’t help that the incoming US president launched two meme coins that basically feed into this idea.

As a marketing-focused DRep, I may sound like a broken record, but I feel that promotion of Cardano’s incredible features to target audiences who would be most likely to appreciate them has been anemic. Thankfully we have a dedicated group within Intersect focused on changing that.

For my part, I’ll continue expanding my education as far as what DReps can do to drum up more participation from the community at large, but I definitely feel that having a cap or saturation point on DRep power is crucial to foster true decentralization and garner trust from delegators.

1 Like

Do you have a write-up on that? Facts and content should be there before marketing, shouldn’t they?

Thanks for adding your opinion to the topic Martin!

It doesn’t take an enormous amount of effort to see how mainstream and even industry-specific media paints crypto and blockchain. Most talk is around price and market movement. And anecdotally, the fact that so much retail investment is sunk into meme coins vs projects with solid utility is a low-effort indicator.

That said, the best way to start any real marketing effort is by talking to the target audience to gather their opinions and to learn about their “pain points” via polling, forum discussions, interviews, and existing data. Thus, I opened this convo (and a poll) to hopefully support a future CIP action.

This type of effort would have the opportunity to produce better results with funding (ads, focus groups, etc.). Maybe DRep compensation could come with a stipulation that a portion of earnings should be geared toward community engagement and marketing actions?

Conversation for another day.

1 Like

Actually DRep compensation is a CIP in the pipeline that I and some folks are working on. You are welcome to join us and discuss with us some of our ideas of how to accomplish successful DRep incentivization.

2 Likes

Thanks Martin! Yes, I’m very interested. Is that discussion taking place on Discord? You can forward an invite here or on Discord and I’ll make sure to participate.:ok_hand:

1 Like