Report on Blockchain Governance Dynamics

Abstract

While the evolution of the World Wide Web has taken various turnsaway from its original vision, the advent of Web3 promises a newera focused on user ‘ownership’ and ‘decentralization.’ Theconcept of Web3, introduced in 2014 by Ethereum co-founder andPolkadot creator Gavin Wood, focuses on a new infrastructurebased on decentralized networks and technologies. This newinfrastructure enhances user ownership and autonomy by movingaway from centralized operators and trusted intermediaries.Blockchain technology is a cornerstone of Web3, initiallydeveloped as an innovative means to record transactions digitally.The collective choices of individuals and organizations drive theevolution of blockchain technology and its diverse applications.These entities form what are known as ‘blockchain systems’:complex techno-social structures that operate across multipleintertwined layers. Beyond the capabilities of blockchaintechnology to store data across multiple nodes, the governancedynamics within blockchain systems are complex and nuanced. Tofully grasp the opportunities and challenges of Web3, it is essentialto analyze the governance practices of its fundamentalcomponents, including blockchain networks.This report is a collaborative effort between BlockchainGov andProject Liberty Institute to analyze the governance dynamics ofprominent blockchain networks through an interdisciplinary andcomparative lens. It focuses on eleven blockchain networks:Avalanche, Bitcoin, Cardano, Cosmos, Ethereum, Filecoin,Optimism, Polygon, Polkadot, Tezos, and Zcash. Through acomprehensive empirical analysis built on previous academic workand practitioners’ insights, the report offers six key findings aboutthe governance dynamics of these blockchain systems.