Aragon vote shows the perils of onchain governance

I watched Aragon’s second network vote with interest because it was clear that there would be fireworks. Unlike their first vote where the only contentious vote was over which auditor to pick, it was clear that in the second vote there would be a few hot button issues.

Case in point: AGP42. Keep Aragon focused on Ethereum, not Polkadot

It failed by a huge landslide of more than 35%. End of discussion, right? Using Alethio’s AGP42 data:

But wait, this is what the vote looked like right before the vote ended:









What changed? This changed. A whale voted at the end.





The vote was 536k for and 530k against. And then BOOM! 792k ANT came in and ended the vote.

Now if you look at that chart, then one interesting thing to note is that the 2 largest whales voted against AGP42. But most decent size ANT holders voted for. And then some tiny holders voted in favor.

It’s probably not too surprising. Aragon management didn’t want this to pass and said so in public. Yet the midsize ANT holders are likely folks with sizable Eth holdings. And then many of the tiny holders voted with management.

Here’s Etherscan’s list of the top ANT holders:





The whale who decided the outcome was 7th, though if you exclude the multis and Bittrex, then the whale is the 5th largest ANT holder.

Here’s another way to view the vote on AGP42. Alethio’s tool is super useful.









Put differently: aside from one whale, AGP42 passes. The Aragon community overall voted for AGP42, but it was rejected with 69% of the vote because of one whale.





But AGP42 was at least very very close among the wider Aragon community.





AGP37 was not close. It was widely approved by the Aragon community who cared enough to vote





82% in favor of AGP37. 453k to 99k. But then the whale voted.





So despite 83% of addresses voting in favor of AGP37, on the surface it appears to be a large defeat where 66% vote against.

That’s not all.

While there are multiple votes to choose from, here’s another case in point: Edgeware Lockdrop Proposal for Aragon

The vote ended with 72% yes. (But wait, there’s more.)

The 792k whale voted for this. Deduct the whale’s votes and you get 338k. Which means that this proposal was losing by about 15% at ~43% versus ~57% pre-whale. Then the vote went from losing decisively to winning by a massive landslide. So aside from the whale, the Aragon community voted against Edgeware lock drop participation.

Also AGP9 was in a similar position where it was losing, and then the whale voted for it, and so it appeared to be a massive victory.





One obvious danger of onchain governance is plutocracy. Unfortunately Aragon’s second vote was not even plutocracy. It was just governance by one whale.

The whale literally decided every vote where people disagreed.





May 3 12:15pm CDT UPDATE: some light copy editing and change to the end. I still think Aragon is amazing, I’m just reporting an issue with this particular vote.