CryptoSlate recently caught up with Nischal Shetty, Founder of India’s biggest crypto exchange WazirX to discuss layer 1s, the human role in blockchain, validator responsibilities, proof-of-stake governance, and decentralization. With the recent chaos with the governance of Terra Luna and the imminent Ethereum merge, we asked Nischal for his insight into the on-chain voting and how blockchain can do better.
There has to be a real concern when multi-billion dollar chains like Terra cannot successfully pass a simple governance proposal or have to resort to off-chain voting. The dream of a decentralized crypto ecosystem we were promised did not come with a caveat that on-chain votes were really only guidance for validators. Ultimately, after an on-chain vote for a proposal validators can still choose to ignore the result and do their own thing. It is for this reason that decentralization is so important. If a set of validators with enough staked assets group together and decide to conduct private off-chain voting they can. CryptoSlate took these concerns to Nischal and below is his response.
Akiba: There’s a lot of talk about the best L1, new L1s, and the growth of sidechains and L2s… it seems PoS has been accepted as the governance system of the future – why do you believe this is?
Nischal: Proof-of-Stake fosters the core idea of decentralization in its mechanism. The power is not concentrated to a few operators and provides an opportunity for more actors to take part in the consensus. The community has more decision-making power and all contributors are fairly compensated. All token holders have equal voting rights and collectively arrive at decisions.
The mechanism also supports complete transparency and resource sharing for all members to take informed decisions at each step of the process. The core model always strives to provide autonomy to the stakeholders and operates on trust…
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