What is on-chain voting?
- Author
- CRYPTO PORT Editorial
- Published
- Updated
- Reading time
- 5 min
In short
On-chain voting records each vote as a transaction on the blockchain. Who voted and with what weight is public, and anyone can verify the tally. The flip side is that votes are not private and cost fees, so many projects pair it with off-chain signalling for the earlier, non-binding stages.
Key points
- Votes are recorded as transactions anyone can verify
- Voting weight is usually based on holdings
- Votes are public, never anonymous
- Fees discourage participation by small holders
Definition
A voting method in which governance votes are recorded as blockchain transactions so that anyone can independently tally and verify the result.
A voter sends a voting transaction from their wallet and it is included in a block. Because the tally can be computed from the public ledger, no operator can rewrite the result. That verifiability is the main difference from voting held off-chain.
Weight is normally proportional to holdings of the relevant token. It is not one person one vote, so large holders carry more influence. Attempts to soften this include weighting by lock-up duration and using the square root of the voting balance.
There are drawbacks. Votes are public, so anonymous voting is impossible. And since voting means sending a transaction, it costs a fee, which leaves small holders with little to gain from participating. Turnout is often low and large holders prevail.
For that reason, many projects run non-binding signalling off-chain via signed messages and reserve on-chain execution for the final decision. Signing costs nothing, which lowers the barrier to taking part.
Watch out for
- · Voting history is public forever and tied to your address
- · A signature request that asks for spending authority 'to vote' is very likely a scam
- · A majority in favour still fails if the voting window or quorum requirement is not met