Tron dPOS: A Time For Corrective Action

The delegated proof of stake(dPOS) system has a lot of merit. Some of the key benefits of a dPOS system are things like scalability, speed, energy efficiency, and better distribution of rewards. In theory, it makes a lot of sense. You reward the good actors and penalize the bad ones. In this case, not only do the delegates benefit, but so do the voters who in turn get rewards. Do you get anything for holding Bitcoin in your wallet? Exactly! But with the good also comes the bad. As was discussed in our recent article, the Tron voting process has surfaced some flaws. There were 9 or 10 Tron Super Representatives that all got 40-50 million more votes at the same time. They all happened to be SRs who seem to be controlled by only a few wallets. This led to the claim that SR positions can be bought.

As the voting threshold to remain an SR was radically increased, many community driven Tron Super Representatives were being forced to give away the house in order to remain a Super Representative. At this point, on behalf on many Super Representatives, Tron Spark decided to publish a related article knowing that it was a delicate subject. But it had to be discussed, otherwise, many great SRs will pay the price. In fact, some have already fallen. Soon after the publication of the article, the community did come together in civil discussion trying to find a resolution.

#TRON(#TRX) Current state of democracy.

✍️ Buying votes is not promoting a true democracy, therefore, we should not be using block and candidate rewards to buy votes, instead these rewards should be going to the growth and development of the @Tronfoundation, change is needed. pic.twitter.com/YJcGCN3RvL

— TRON News | 新聞 (@TronNews_) November 23, 2018

The Catch 22

The issue with trying to add rules and guidelines to a decentralized system is that it defeats its own purpose. A decentralized system is supposed to put the power in the hands on the people. Adding restrictions and rules does in fact seem a bit authoritarian in nature. This is what makes this topic so complex.

We all know that the prime objective of Tron is to decentralize the internet. As with any new endeavor, especially one of such grand magnitude, there will be growing pains as it matures and evolves. This is such a case. The Tron Foundation clearly knows this. After our last related article, much healthy discussion ensued on social media. Twitter was flooded with ideas and opinions on the matter. That is very healthy as long as the conversation remains civilized and carries on with the common goal of improving the Tron ecosystem.

The Primary Concerns

I will keep it really short as the issues were mostly covered on our previous article. For those new to this discussion, the two main concerns discussed on social media were SR 100% rewards and whales buying their SR spots. I have already pointed out that SRs do not want to give 100% rewards as it leaves no funds for servers, operating costs, nor for any development or expansion. In the recent case, the 100% rewards were the consequence of the pressure applied by these whales or deep pockets. The current 10-11% voter participation also does not help. So please go out and vote for an SR!

A Unique Solution While Maintaining Decentralization

In the back and forward discussions taking place on Twitter, a user @Cgj_Crypto responded to one of our Tweets with the following:

Alright, I wrote up a proposal, DM me if you want to see it as I want folks advice before posting it publicly

— CGJ Crypto (@Cgj_Crypto) November 24, 2018

Curiosity killed the cat. I messaged him to see what solution he had in mind. He threw several ideas out which all seemed interesting. Nonetheless, there was one that was simply thinking outside the box. I liked it so much that I told him I wanted to write an article discussing his proposal so that the community can take it and run with it. The thing that really caught my attention was that he found a possible solution without sacrificing decentralization. That is not an easy thing to do as one thing usually affects the other. Therefore, we talked and we tweaked. And we think we now have something for the community to discuss. Please analyze this with a discerning eye.

Delegated Proof of Stake: Root Causes to the Problem

The first things that @Cgj_Crypto stated were the root causes. As a problem solver, when you start with identifying root causes, as opposed to adding another barrier and hoping that the swiss cheese slices do not line up, you definitely got my attention. These were the root causes he provided:

Root Causes

• Each frozen TRX is only allowed to vote for 3.7% of the network rather than vote for the majority of the network.
• Good community minded SRs end up competing for votes with other good community minded SRs while centralized non community minded SRs sneak up the middle. The “Good” vote ends up being split.
• Anyone can buy their SR spot without community giving the go ahead.

The Initial Solution

What if instead of voting for a small fraction of the field, about 3.7% if you are voting for an elected SR, you have the ability to vote for the majority of the network? How is that possible? Let me explain. Currently, each TRX you freeze gives you 1 Tron Power or 1 vote. How about if instead of it giving you 1 Tron power it gives you 1 Primary Vote(same as 1 Tron power) and 13 Secondary Votes. So when it comes to voting to attain rewards, you use you primary vote for the SR which will pay out rewards and then you can also vote 1 secondary vote for up 13 of the other candidates. These secondary votes do not count for reward incentives but do count for SR status. Furthermore, stacking of secondary votes is not allowed. This will require all SRs to get community support.

Let’s say I have 200k TRX frozen with 200k Tron Power. This gives me the ability to vote 200k for my reward paying SR, and also allows me to vote 200k votes for up to 13 other candidates. These 13 other candidates will not be paying any rewards on these secondary votes. Nonetheless, they will be getting 200k votes for determining SR status. Not all 13 blocks need to be used. Also, if I decide to break my reward paying votes into 2 SRs, they each get 200k votes for SR status qualification. Then 12 other SRs could get the remaining 200k each.

The Original Idea as It was written

Below I have included the original concept provided by @Cgj_Crypto.

Not So Fast

After discussing with other SRs, a valid counterargument was brought up. This creates cartels as has been seen with EOS. A group of SRs can collude with each other and spread all the votes amongst their group of 14. This is definitely a valid counterargument as it can create 2 large groups controlling the SR status(cartels essentially). So what other options do we have? How about limiting the secondary votes to a smaller number, such as 2. This will still make it much more difficult for a whale to vote themselves in, as they need 3 times the current amount of votes, but will also give much more power to the community. And in a worst case cartel world scenario, you end up with 9 groups which is way better than what we have today.

When Code Changes Are Needed

Making such changes requires code modifications.  It will also require approval and implementation from Tron itself. This is not one of the pre-built, or hard coded, parameters that Super Representatives vote on, such as the cost of energy. This is something that requires modifying the existing code. As I am not a developer/coder, I cannot comment on the pros and cons. I’ll leave that to the developers to discuss, and hope that they can share their opinions with the community. They can reach out to me and I can publish the information if needed. As a dPOS, I do not see why these changes cannot take place if it is feasible and if that is what the community wants for the betterment of Tron.

Community Discussion for Resolution

These are just ideas. Though an idea which I consider worth evaluating. Your own ideas are also welcomed. The numbers provided in this example can all be discussed and modified. The concept can also be tossed entirely upon further review. Keep in kind that a thorough risk assessment with due diligence is required prior to making any changes on the blockchain. Also, whether this can be implemented will require the tech gurus to chime in. Please feel free to provide your own feedback and analysis as Tron, being a delegated proof of stake protocol, relies heavily on the input from the community. Together is how we will overcome our challenges and become the best blockchain in the world.

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