Introduction to Qtum Part 10

Qtum Decentralized Governance Protocol.

The development and direction of blockchain networks has been an issue since the inception of cryptocurrencies, including Bitcoin and Ethereum. Satoshi Nakamoto has launched the Bitcoin network in 2009 and since then there hasn’t been a single cryptocurrency immune to critical problems or forks, which are changes to software that result in two separate versions of a previously one blockchain.

There are two main types of forks. They are soft forks and hard forks. A soft fork is an update of software that is backwards compatible with previous versions of the software. Typically, when a blockchain network implements a soft fork, the chain splits temporarily, but the majority of power stays with the main chain. A hard fork is an upgrade that is not backwards-compatible with the previous versions of software. Members of a network that is going through a hard fork who not upgrade their software will not be able to send or receive transactions. The network will deem transactions as invalid. A hard fork is a split that always results in the creation of two separate chains.

Bitcoin Cash has been one of the major forks of the Bitcoin network. The appearance of the Bitcoin Cash is a perfect illustration of why Qtum Developers have decided to create Qtum Decentralized Governance Protocol (QDGP).


What is QDGP?

The idea behind the QDGP is that while a fork is not desirable for a cryptocurrency blockchain network, history shows that at some point in any network’s history a fork is almost necessary. For this reason, Qtum developers have created the QDGP, which is a protocol that allows to introduce changes to the main blockchain by modifying them though a special smart contract on the blockchain without causing any disruption to the network ecosystem. Once a change goes into effect, the users of the network do not need to download or upgrade their software. The network also won’t need any interruptions or interventions from the nodes or other members of the ecosystem.


A short explanation of how QDGP works

The way QDGP operates is relatively simply. First, a party makes a proposal to change a parameter in one of the settings of the Qtum blockchain. Then, all governing parties of the ecosystem vote on the proposal. If the proposal gets enough positive votes, the change of the parameter becomes active. The data with the proposed change becomes a part of a special storage area where the blockchain software can access it easily. It is important to note that enough though the Qtum developers did come up with the idea of QDGP, they still expect their software to go through hard and soft forks. However, the idea and implementation of the QDGP should allow Qtum ecosystem to have less forks that Bitcoin, Ethereum and other major cryptocurrencies have went through.


The notion of a governing party

When it comes to participation in QDGP voting, the creators of Qtum always use the term “governing party” and not terms “person,” “persons,” or “organizations.” It is an important distinction because each governing party can be a person, an organization, or even a smart contract. The structure of QDGP even allows to replace the governing parties with a new kind of “blockchain controllers” via a “meta-proposal” that would allow the QDGP to change the governance approach to a multi-tiered structure. Such a structure could include, for example, a board with a certain number of board members that satisfy certain conditions such as being a core developer of Qtum.


Examples of QDGP in action

An example of a situation where QDGP could help the Qtum network avoid a fork is block size increase issue. Obviously, the technology will not increase the block size on its own. It also can’t determine what the block size should be, but it could help the network keep operating smoothly while finding a solution to the block size issue, should it become an issue.

Another example of a scenario where QDGP could be useful is the situation that happened on the Ethereum network regarding the price of gas.

Developers have discovered that the Ethereum network had flaws. The flaws could potentially allow miners to make certain operations very expensive to users, yet execute them at a very low price. On the Qtum network, along with a QDGP for the block size, there could be a QDGP for the gas schedule. The gas schedule QDGP could contain gas prices for all the operations possible, this eliminating the possibility of an attack or exfoliation of the network by malicious nodes. If someone was to discover that certain operations on the Qtum network were underprices, the issue would be extremely easy to fix via the QDGP route. Depending on the severity of the problem, a fork could have still been required, but QDGP could serve as a viable option. Neither Ethereum nor Bitcoin had it as an option, which is why they had to go through the forks.


The future of QDGP

The Qtum Network has big plans for QDGP. The goals are very ambitious because the governing right could eventually go to a smart contract that could be in charge of really complex and effective governing approaches, such as automatic monitoring of the health of the blockchain and introduction of changes based on certain criteria, which would Qtum blockchain self-regulating, self-monitoring, and self-modifying. For example, instead of having debates about the block size, a smart contract on the network could monitor the status of the blocks of the blockchain and increase the size of a block if, say, last 5,000 blocks of the blockchain have been at least 92% full. With QDGP, some changes could be automatic. For some other changes, there could be auxiliary smart contracts collecting votes from members of the ecosystem or monitoring the blockchain in other ways.

This approach could lead to Qtum becoming the first self-aware and self-regulating blockchain network that can quickly adapt to the changing requirements without long debates or forks that cause interruptions and damage to the blockchain ecosystems and networks.