Think of the whale as a million small investors. There is no difference unless you somehow KYC every wallet so that you can tell which ones the whale controls.
And, by the way, the whale is likely to be more sophisticated so he will split his wallets in the most optimal way and stake the most optimal way to maximise his voting power.
So, just to make my previous argument clearer, I’d use some examples:
if the whale delegates his 20M to a pool with already 20M stake, the pool decentralization will decrease - which now means low reward for the pool. This makes the small investors leave the pool and, therefore, decreasing the pool vote count. So, whenever a pool has a wallet that holds 50% of the total stake, its decentralization metric decreases.
If the whale splits his 20 M into 5M each split and delegate them to pools that already have 20M stake, then his influence in these pools are low. He is not going to be able to control the pools. If he delegates them to pools with already 5M stake, then we are back to example 1.
There is no need to KYC. It’s the decrease in the decentralization metric (example 1) or decrease in influence (example 2) that minimizes the impact of a whale.
Just to complicate things a bit more to illustrate more absurdity: A so called “whale” could be holding Ada in one wallet on behalf of a million individual people. Eg. Family trusts, unit trusts, business trusts. So even if it is one wallet, you still don’t know how many people it represents. Unless, of course, you KYC everyone involved…
Why do you so vehemently seek to invent a perpetual motion machine in order to deprive this whale of her just voting power? If she is treated unfairly, she will take her money and invest it in a more fair minded community. Wouldn’t it be smarter to treat the whale you refer to fairly? And furthermore, seek other successful whales like her to also come and invest in the community?
Just to complicate things a bit more to illustrate more absurdity: A so called “whale” could be holding Ada in one wallet on behalf of a million individual people. Eg. Family trusts, unit trusts, business trusts. So even if it is one wallet, you still don’t know how many people it represents. Unless, of course, you KYC everyone involved…
This would be an internal agreement and the parties should know the implications and consequences of this agreement. That’s on them and not on the protocol.
Why do you so vehemently seek to invent a perpetual motion machine in order to deprive this whale of her just voting power? If she is treated unfairly, she will take her money and invest it in a more fair minded community. Wouldn’t it be smarter to treat the whale you refer to fairly? And furthermore, seek other successful whales like her to also come and invest in the community?
Imagine this scenario: two fully saturated pools, one pool belongs to a whale (68 M ADA), the other pool is composed of small investors with 1000 ADA each. The majority of these small investors are honest.
Now, imagine that there is a CIP that is harmful and benefits only the whale and a few other small investors. In a popular referendum the whale will easily get the CIP passed (68M plus some from small investors is more than 50%, yes vote wins).
However, in an electoral college system, the whale only gets one “yes” vote while the other pool gets one “no” vote. The CIP cannot pass.
Look, I think we are going around in circles.
And guess what: All of those small investors are actually the whale because she split her wallet and delegated to that pool a long time ago. What, you didn’t know that all those separate wallets were actually the whale?
Sorry but it does not make sense that a single whale will split his holding into wallets with 1000 ADA and delegate to the same pool 
If you try to limit their rewards or voting power otherwise (which they obviously would know, since we won’t and can’t do things secretly here, do we?), it makes total sense for the whale to split up and pretend to be a swarm of herrings to outrun your attempts to punish them.
Ah, I see the point. It makes sense in the 2-pool scenario; but with 3000 pools, the whale is only going to get 1 pool vote if he is going to attempt a fake “decentralization” in one pool.
Also, how convenient would it be to split 68 M stake into wallets with 1000 ADA. Or even 10,000 ADA? Some might attempt but I doubt many whales would do it.
Which brings us back to:
Through your system, rather than limiting the voting power of whales (which I think is impossible without KYC/identity/uniquesness of identity) you allow them to double their voting power by securing the majority in small pools and getting the voting power of the other delegators of those pools for free.
Your rebuttal
doesn’t work anymore if the whale pretends to be lots of accounts due to the general hostile climate towards whales. The other delegators cannot see anymore that someone already has secured the majority in “their” pool.
Plus: The day of the snapshot has to be known. You cannot keep such things secret in a decentralised system. Everybody knows. The whale can coordinate their huge amount of ADA quite well on that day, while the small accounts would have to try to coordinate many individuals to meaningfully counter such methods (if they can even notice it, see above).
You do know that such things can be scripted quite well?
The harsher you try to limit whale power, the more incentive you create to do it.
Ah, yes you can do scripting. Again, the question is how convenient would that be given that you are more likely putting your funds on hot wallets, and manage your keys digitally which will make them prone to attacks.
The point here is that, whatever the whale does to game the system is accompanied by risks. He might just as well play it safe.
The whale is more sophisticated and knowledgeable about risks and how to mitigate them than most, if not all, of the minnows. She is a whale precisely because she is sophisticated, intelligent, and successful.
Out of interest: What if Elon Musk became a member of the Cardano community, started investing in Ada, and started building tools and services? Would you seek to limit his voting power to be less than proportional to his Ada?
I’m not sure if being a whale equates to being smart as there are many ways wealth are acquired such as inheritance. But good for her/him if she/he knows how to manage risks, but we can all agree that hot wallets and saving keys digitally are risky.
If Elon Musks invest in ADA and the electoral college system is already in place, that only suggests one thing: Elon agrees to submit himself to the protocol.
You can, of course, do such scripting on air-gapped machines. The equation script solution = hot wallet is as wrong as no scripting = super-secure offline solution. I’d hope that most whales at least use hardware wallets, but I won’t necessarily believe it.
And even if you are too lazy for that, having them managed in a hand-baked script solution is already much less likely to be attacked than the standard wallet apps used by retail. Malware wouldn’t know, where to look for keys exactly, and 90% of attackers take the (far too) easy targets that are naïve enough to give their seed phrase to a half-convincing scam site.
If Elon Musk would enter ADA, I would leave as soon as possible. That guy does not qualify as a positive example for anything. And whatever society he decides to penetrate with his existence should just tax the shit out of him or completely disown him.
I’ve done basic scripting before with cardano-node, and i mean that thing is not fun.
In this case, the transfer of small amount of ada, to individually delegating them, and monitoring if your stake still has influence on a pool, and then redelegating if it’s not, plus you have to contend with 3000 other pools or 4000 or 5000. That’s exhausting to me at least. Because what, you can only control a certain number of pools, not all 3000, 4000, 5000.
If you want to meaningfully reduce their rewards (in the other “decentralisation” proposal) or give them the possibility to multiply their voting power (in this proposal), you are creating a huge incentive to do just that.
Although developer onboarding in Cardano is not optimal, there still are enough people who do not consider writing such a solution overly complicated.
You also don’t have to monitor all 3000+ pools for that. A single whale with something in the range of 100 million ADA won’t be able to single-handedly completely control the outcome of a vote, anyway. But your electoral college style system still gives them the possibility to control a much larger share of the votes than just voting power by ADA.
Yeah, it can definitely increase their voting power but not enormously. In your example it was only an increase of 0.6 for a whale holding 63M. And there is not that many 63 M whales, and since staking is dynamic, there is no guarantee that the 0.6 increase will secure a cip pass.
In your example for the popular system, 99M vs 97 M, there is no dynamism to this. The 99M will always win.
They have 63 million / 196 million = 32.1 % of the ADA and, hence, of the voting power in pure vote by ADA.
Already in the non-optimised stake-pool-indirected, electoral college example, they control Pool 4 completely, i.e., 1.0 votes / 2.8 votes = 35.7 % of the total votes.
In the optimised example, they control Pools 2 to 5 completely, i.e., 1.8 votes / 2.8 votes = 64.3 % of the votes. Exactly doubled.
And that does not depend on the toy example, where it is a significant share of the total votes. And it also does not depend on being in the range of 60 million. As long as the whale has enough to find a pool where they can have 50% of the stake, they can always double their influence, even if they have only 2 million.
In a real-world example, a single whale will never have enough to completely control the vote result, but they can still (almost) double their influence, not enough to decide alone, but surely unfair.
The time when the snapshot for determining voting power is taken is known. They just have to make sure to have as close to 50% of the stake in all pools they are delegating to (with hosts of accounts) by that time. The small stakes of retail would need a quite unrealistic coordinated effort to move much just before that deadline.
The only unpleasancy could occur if two whales try to do that on the same pool and compete for getting 50% in it. Since it is unpleasant for both, they could just try to move to pools with no other whales (looking if there were large stake changes in the couple of days prior to the vote deadline).
Yes, and that could be considered good, the correct result.
If you consider it good, seems to depend on the question if the 99 or the 97 contain more whales (and on you being able to identify if there even are whales in there).
They have 63 million / 196 million = 32.1 % of the ADA and, hence, of the voting power in pure vote by ADA.
Already in the non-optimised stake-pool-indirected, electoral college example, they control Pool 4 completely, i.e., 1.0 votes / 2.8 votes = 35.7 % of the total votes.
In the optimised example, they control Pools 2 to 5 completely, i.e., 1.8 votes / 2.8 votes = 64.3 % of the votes. Exactly doubled.
And that does not depend on the toy example, where it is a significant share of the total votes. And it also does not depend on being in the range of 60 million. As long as the whale has enough to find a pool where they can have 50% of the stake, they can always double their influence, even if they have only 2 million.
If you are talking about subsets, these are the numbers. Now, think about these numbers for all 3000+ pools. You will win some subsets but not all 3000+, and at an increase of 0.6 votes, that’s minimal. Is it really worth to split your 63M into multiple 10000 ADA just to get 0.6 additional vote? That’s 6,300 wallets. You are getting an additional vote of 0.000095 per wallet only.
Now, Imagine how small would it be for smaller whales.
The only unpleasancy could occur if two whales try to do that on the same pool and compete for getting 50% in it. Since it is unpleasant for both, they could just try to move to pools with no other whales (looking if there were large stake changes in the couple of days prior to the vote deadline).
What happens if a whale had stayed there already even way before? You can’t see that by looking for large stake changes in the “couple” of days.
Yes, and that could be considered good, the correct result.
If you consider it good, seems to depend on the question if the 99 or the 97 contain more whales (and on you being able to identify if there even are whales in there).
But not if the 99M had already formed an alliance - the whale alliance. It’s like the senate, whoever controls the majority always wins.
Its almost like we need an academic paper on this…
Some background analysis https://arxiv.org/pdf/2201.07188.pdf by Lazos and Kiayias…
Our work lays out a common foundation for assessing governance processes in blockchain systems and while it highlights shortcomings and deficiencies in currently deployed systems, it can also be a catalyst for improving these processes to the highest possible standard with appropriate trade-offs, something direly needed for blockchain platforms to operate effectively in the long term.
As an aside against their objective criteria Catalyst does not come out well. I rather hoped they might have come to a conclusion that would feed into CIP1694.
The evaluation framework should be applied though to assess candidates?