Introducing the District Registry

An incentivized voting game to determine access to the network

As an open source project we are frequently asked how we intend to ensure that prospective marketplaces make use of the district0x Network Token for their district, how we will safeguard the district0x Network from malicious actors which could open the project to legal risks, and how we will dictate access to the District Staking Interface and a suite of ancillary services designed to maximize network effects and build moats around the district0x Network.

Today we introduce the first component of a multi-pronged approach which we believe will address the aforementioned questions, the District Registry.

The District Registry

The District Registry is a decentrally-maintained smart contract which stores the credentials of districts which have been granted access to the district0x Network. The presence of a district in the District Registry signifies that the district has been accredited by DNT holders as non-malicious and value-additive to the district0x Network via an incentivized voting game.

The District Registry is modeled after the adChain Registry, a collaborative effort between ConsenSys and MetaX, which makes use of a deposit and challenge mechanism to allow token holders to maintain a whitelist of approved members in a decentralized manner.

When a prospective district wishes to apply for access to the district0x Network, they will submit a DNT deposit with their application to the registry, initiating a challenge period during which any DNT holder can challenge submissions that they believe do not add value to the district0x Network or could put the network at risk. Token holders can challenge the application by depositing an equal amount of DNT to the registry, opening a voting period during which all DNT holders can vote for inclusion or denial of the specified district in the registry.

DNT holders are incentivized to participate in the challenge and voting process to ensure that districts added to the network bring value, thereby protecting and increasing the intrinsic value of their DNT. Participants on the winning side of a vote also stand to receive a portion of the deposit made by the losing party in the event.

Amending our plans to mint 1 new DNT every time a district is created on the network to assign the initial voting rights in the corresponding Aragon entity to a district’s creator, we now intend to require district creators deposit DNT when submitting a proposal or making use of the district creation interface, allocating the initial voting rights. The required deposit amount will be periodically voted upon by DNT holders.

The aforementioned change comes in conjunction with an amendment to our plans for 1:1 DNT-to-voting-right staking. We now intend to make use of a sliding pricing curve which will add incentives for early supporters and protect districts from malicious voters, with the amount of DNT required to stake to mint 1 voting share increasing as a district’s deposit pool grows. More details on the staking mechanism will be presented in a subsequent blog post and white paper update.

Flow of Value Between Network Participants

The diagram below illustrates the way which DNT will flow between entities in the district0x ecosystem in the event of a district proposal submission and challenge, with the proposal ultimately being approved.