What is Trusted Neutrality? How to Bring True Fairness to the Blockchain Ecosystem?
Recently, due to the improvement of the market, there have been many token airdrop activities. However, there are often complaints about the unfair distribution of tokens by certain teams. It is time to review the solution proposed by Vitalik four years ago – Credible Neutrality, to supplement the shortcomings of blockchain technology and bring more “fairness” to the ecosystem.
Table of Contents:
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Developers are questioned more than miners
Introduction to Credible Neutrality
What is Credible Neutrality?
Neutrality is relative
Trustworthiness ensures sustainability
Verifying miners vs verifying project developers
How to build a credible neutral mechanism
Do not write specific individuals or groups into the mechanism
Open source and publicly verifiable execution results
Simplify the system
Avoid frequent changes to the mechanism
Bringing fairness into the world of blockchain
Imagine a scenario where when a project announces a token airdrop, a portion of the tokens is often given to core contributors. While it is reasonable to reward developers, people sometimes feel unfairness, especially when the core contributors receive a larger share of the tokens.
Because they do not know how to measure the so-called “contribution” and there is no evaluation mechanism in place, other participants (usually regular users) often feel unfair events.
Most reward programs, including the Ethereum Foundation’s bonuses, Celestia, and Avail airdrops, distribute token shares to contributing developers. Although project teams emphasize the transparency and decentralization of the evaluation process, they are still doubted and suspected by other stakeholders, questioning whether the team is biased and whether the evaluation is truly fair.
In a sense, miners also receive token rewards based on the size of their contributions, distributing rewards based on computing power and time. However, no one questions whether miners’ earnings are reasonable. Why is that?
Even though both have made contributions and the processes are decentralized, why do people not doubt the token rewards received by developers but doubt the rewards received by miners?
The problem lies in the lack of “credible neutrality” in the reward mechanism for developers. The concept of credible neutrality was proposed by Vitalik in 2020. He believes that:
“If the design of the observation mechanism alone can easily show that the mechanism does not discriminate against or oppose any specific person, then the mechanism has credible neutrality.”
A credible neutral mechanism treats everyone fairly, so that in a world where everyone’s abilities and needs are so different, it does not operate based on specific individuals as inputs. For example:
“Anyone who mines a block will receive 2 ETH” is credible neutrality; a team saying “Bob will receive 1000 tokens because he has written a lot of code” is not credible neutrality.
“A mechanism that does not display any posts marked as bad by five people” is neutrally credible; a mechanism that displays any biased posts against blue-eyed people is not credible neutrality.
The government giving 20 years of patent protection to “any invention” is neutrally credible; the government allocating $1 billion for cancer treatment in the field is not credible neutrality.
A mechanism that does not favor specific individuals or groups can be called neutral, and if the neutrality of the mechanism can be easily observed, it is considered trustworthy.
Neutrality means not favoring any party and not expressing any attitude or behavior towards any party. However, like the concept of decentralization, “neutrality” is not black or white but relative.
Block rewards favor those who have special connections, access to hardware, and cheap electricity. Strictly speaking, it still favors those with capital. But compared to token issuance for blockchain projects, it is clear that many tokens have been pre-allocated to specific individuals. Therefore, the neutrality level in the former case is higher.
This is why the private property system is so effective: not because it is a God-given right, but because it is a “relatively” neutral mechanism that rewards value creators and can solve many problems in society (although not all problems).
Not only neutrality is needed, but also trustworthy design. For a mechanism to be trusted by a large and diverse group of people, trust is crucial.
Mechanisms such as blockchain, political systems, and social media aim to facilitate cooperation among large and diverse populations. In order for a mechanism to truly serve as a common foundation, every participant must be able to see that the mechanism is fair and that other participants can also see that their participation in the mechanism is fair.
Because every participant wants to ensure that “others will not abandon the mechanism the next day.”
Going back to the initial question, this is why rewards for blockchain developers are more easily doubted than mining rewards, because it is relatively easier to verify who is a miner compared to verifying who is a project developer. The mining mechanism of blockchain is relatively more neutrally credible than the reward mechanism for developers on the chain.
This example illustrates that for a system that aims to include everyone, it needs to meet the criteria of credible neutrality in order to reassure participants and ensure sustainable operation. This is also a key element in the ideal Web3 infrastructure, in addition to the decentralization, security, and efficiency of blockchain.
Relying solely on blockchain cannot achieve a credible neutral mechanism. The system needs to meet four main rules:
1. Do not write specific individuals or groups into the mechanism.
2. Open source and publicly verifiable execution results.
3. Simplify the system.
4. Avoid frequent changes to the mechanism.
Each of these rules is explained below.
This is the most important point emphasized in the above explanation: not favoring anyone or anything. In a credible neutral mechanism, it should not start from specific individuals or things, but from the behavior of participants.
In a free market, through the market mechanism, it can be discovered that Charlie’s product is useless while David’s product is useful, and eventually people will stop buying Charlie’s product, leading to Charlie’s bankruptcy, while David earns profits and can expand his scale.
Most of the information in the output should come from the behavior of participants as input, rather than from hard-coded rules within the mechanism itself.
The rules of the mechanism should be public and should be able to be publicly verified to ensure that the rules are correctly executed.
Of course, in many cases, the privacy of participants should be maintained (and it should even be impossible to prove how they participated). Therefore, achieving both public verifiability and privacy can be provided through zero-knowledge proofs.
The simpler the mechanism, the less space there is for privileged hidden privileges to be inserted for the target group.
If a mechanism has 50 parameters that interact with each other in a complex way, it is easy to hide specific rules. But if there are only one or two parameters, it will be much more difficult, just think about how much harder it is to cheat in rock-paper-scissors compared to online games.
Changing the mechanism is a form of complexity, which increases the difficulty of implementing the third rule and also resets the time on the veil of ignorance, as others need to reunderstand the rules of the mechanism, which provides an opportunity to reduce neutrality.
Blockchain is only the foundation, not everything. Blockchain only guarantees the decentralization and transparency of information on the chain. Therefore, even if a product or protocol is built on a decentralized network, there are still many other important components needed to build a freer and healthier Web3 ecosystem.
Credible neutrality is one of them. For a system to have the acceptance of all parties, it needs to have a neutral nature that is recognized by all. This can encourage participants to be more willing to participate in the ecosystem and make the governance or development process of the entire industry smoother.
Even if blockchain is used to record and provide high transparency, without ensuring fairness in the mechanism, it cannot achieve a sustainable community foundation.
In the future, when projects issue tokens or promote services, it may be worth considering how to conduct them in a more fair manner, which may reduce many unnecessary disputes.
(Vitalik’s vision of the ideal blockchain and Ethereum’s social model, integrating speculation and development, calling for a return to Cypherpunk!)
Credible Neutrality
Vitalik
