The following content is quoted and translated from chainnode:
Online Governance of LBTC
Blockchain governance is the objective basis and institutional guarantee for the formation and maintenance of consensus agreements. At the same time, governance also provides a subjective route of advice for all parties involved to reach consensus. In the long history, the measures within the three organizations of management, governance can be regarded as the centralized model according to the rule of governance, such as: emperors. From the perspective of the management, it can be seen as weak centralization, such as: company or organization. From the perspective of governance, it can be seen as decentralized, such as BTC. From management, domination to governance, what behind the framework is the inevitable requirement of productivity to production relations and economic foundation to the superstructure. If blockchain technology can be used to revolutionize production relations, the revolution of traditional governance will rise up with the emergence of new-type on-chain governance.
LBTC’s unique SGS (Spark Governance System) on-chain governance system can be granted to be the only project in the cryptocurrency that has the right to speak on the on-chain governance. The pioneering ones must have gone through many difficulties despite of their adventurous spirits. This innovation is destined to be unsatisfactory. LBTC’s governance philosophy is the separation of powers, that is, to separate the right to book and the right to discuss. Give the billing right to the node, the miner. Give the right back to discuss to the holder of the money, which is the user. Implementing separate governance thus to reach the balance development. Owing to that LBTC is a DPoS-based project, the system solves the problem of staking, so that the holders will have the right to discuss, fully mobilize the activeness of users to participate in system construction, in this way the community run in a healthy way.
In contrast, BTC and ETH, the example of off-chain governance, the miners of which have too much power. The users in the system are static and non-dynamic. When the system needs to be upgraded, the user has no right to decide the system development route. ETH is much more efficient than BTC in terms of governance efficiency, owing to the leader’s personal belief. However, its personal beliefs will also lead to the drawbacks of power centralization. The transition from under-chain governance to on-chain governance is a trend. Great projects are never tied to trivial matters. For now, there are several projects based on on-chain governance, such as Tezos, Cosmos, Dfinity, ChainX, Polkadot, etc.
DPoS is essentially a system of representative democracy. The people vote to elect people who are capable and able to represent their will, and delegate governance rights to others to achieve indirect control. High efficiency and reasonable division of labor structure are its characteristics. However, considering the fairness and universality of direct democracy, LBTC implements the mixed governance of direct democracy and representative democracy, that is, the double governance structure of council governance and community governance. Additionally, a sophisticated communication feedback mechanism is designed between the governance levels, so that the board and the community can focus on the matters that they should pay attention to and make decisions. The LBTC Board of Directors is more like a management agency under the chain, responsible for maintaining and updating the parameters of the main network protocol and managing daily community affairs. Any LBTC holder or organization group can become a director as long as they pass the KYC verification. Under this hybrid governance mechanism, the allocation and communication of power is more flexible and efficient.
The SGS on-chain management system enables LBTC to become a self-evolving agreement to constantly adapt to new opportunities and challenges in the future. All participants jointly decided to promote the agreement upgrade. With the maturity of the Delegates consensus mechanism, the problem of Staking will be solved, which will directly promote the continuous improvement of the on-chain governance.
That’s why we stand out and always be unique!