Blockchain governance is rapidly growing as an important factor in the industry. The decentralized governance on blockchains allows users to directly make transactions without an intermediary or middleman while providing checks and balances on those with authority hence making the process more transparent and trustless. As each transaction on the blockchain must go through a number of validators and voters, transactions remain public, meaning no central authority can tamper with the blockchain’s processes. Finally, decentralized blockchain governance helps improve the efficiency and the rate at which decisions that affect the community are passed or rejected.
While other areas of the blockchain industry have witnessed massive upgrades and developments in the past, blockchain governance has not experienced quite the same rate of growth, despite this idea gaining more supporters by the day. Nonetheless, new upgraded protocols and tools are being built to usher in the “third wave” of blockchain governance, following massive successes and failures of the preceding two generations. As it is with blockchain iterations, the first wave of blockchain governance was integrated onto Bitcoin, while the second generation blockchain governance iterates Bitcoin’s governance and solves issues underlying its governance.
The second generation of blockchain governance protocols mainly includes Ethereum and EVM-compatible blockchains such as Polkadot, Polygon, and Cardano. While EVM-compatible chains are bringing faster, cheaper, and more efficient solutions to solve the scalability problems on Ethereum, critics still argue about the lack of decentralization on these chains. And for the right reason.
While it is not well documented or talked about, front running is a problem gradually creeping into EVM-compatible chains. Simply, front running is an industry-wide problem that arises from a few mining pools controlling validation and block production of a blockchain. It started with bots offering high gas fees to jump the line, in front of high-value transactions. Today, miners are performing the front-running, by inserting their own transactions ahead of others, while paying only the minimum gas fees, or known as miner (maximum) extracted value (MEV).
Telos, a third-generation governance blockchain, aims to minimize cases of front-running and high fees via its ground-up built Telos EVM. According to the website, the Telos EVM will be built on the “extremely fast” blockchain, producing two blocks every second. Apart from facilitating instant transactions, the ultra-fast chain leaves little time for miners and bots to scan the mempool or insert their transactions ahead of the others.
EVM compatible chains such as Polygon, Fantom, Avalanche, etc. have a flexible fee schedule meaning miners are incentivized to front the system when fees are high. Telos, on the other hand, relies on a fixed rate fee schedule on the Telos EVM meaning transactions cannot be placed before others as there’s no incentive to do so by offering a higher fee.
Telos EVM follows the rules set out by the community. The platform is run by its community via decentralized governance systems coded into the smart contract. The blockchain is fully governed by its community and validators/stakers cannot temper or reorder the transactions in any way. On Telos, all block producers must process transactions on a first-in, first-out basis, as they receive them. Any case of a validator breaking the rules could attract a penalty or result in a ban.
With the launch of the Telos EVM, the blockchain offers a high degree of protocol-level and participatory governance that is extended to DApps and DAOs deployed on Telos as well. Since its launch, Telos has massively improved its governance by incorporating a number of advanced features including the election of validating nodes, Telos Amend (updates the protocol via decentralized voting controlled entirely by on-chain smart contracts), Telos Resolve (deals with dispute resolution through elected arbitrators), and Telos Works (allocation of work proposal system funds). Notwithstanding, Telos beats Tezos on the scale, speed, and compatibility to other blockchains and languages. Telos ranks as one of the most versatile platforms, generating blocks for 95+ percent of the DApps including those written in C++, Solidity, and Vyper.