thank you for taking the time to share your thoughts.
Regarding establishing higher authority to those, who have a higher value stored in the network — I agree to some extent. I would say that it largely depends on the purpose of the network. I.e. if they store lots of resources in the network to ensure the validity of the current chain. Then I would trust them as validators. However, I would not trust them in decisions that e.g. require an understanding of the purpose of those applications that build on the chain.
If their goal is to maximise returns, they might not have the best interest for the community in mind.
One year later, I acknowledge that my reasoning for plutocracy has been too binary. By now I would have a different take on the on-chain democracy part.
“A problem I do see, which you haven’t mentioned, is the possibility of, for instance competitors, to buy up a large stake, to negatively influence certain votes. They can then easily sell their stake without suffering the negative consequences. Do you have any thoughts on this problem?”
— I have not thought about this yet. Without thinking further about this, most PoS chains require such a large stake that it would be virtually impossible for one player to take over the vote/chain and negatively influence the decision making without requiring coordination. However, several applications probably don’t have enough security guarantees in place. One example is Aragon’s AGP process — quite low participation rate and votes can easily be flipped by whales (including the founders).
Can you think of any examples?
Have a great day,