Coin-based Voting
Traditional voting systems rely on an identity to avoid voters casting multiple votes. However, in a decentralized system, it is impossible to identify a user beyond doubt. In some cases, this is even against the philosophy of such a decentralized service.
Identification makes censorship possible. But the problem with the double votes persists. It would be easy to set up different accounts and vote through them. The idea of coin-based voting is to link the voting power to a scarce resource, similar to PoW (electricity) or PoS (coins). Each voter has to prove that he owns a certain number of coins. This can be done by depositing those coins in a smart contract. Those locked-up coins are returned after all votes are cast.
The simplest method would be to weigh each vote to the number of coins deposited along with this vote.
Example
The following table shows five voters, their votes, and the number of coins they linked to their votes.
| Voter | Coins | Vote |
| 1 | 15 | Candidate A |
| 2 | 15 | Candidate B |
| 3 | 10 | Candidate A |
| 4 | 30 | Candidate D |
| 5 | 20 | Candidate C |
| 6 | 5 | Candidate C |
| 7 | 15 | Candidate B |
| 8 | 20 | Candidate C |
In total, we have 130 coins.
After tallying the votes, we get the following result:
- Candidate A receives votes worth 25 coins. This is 25/130 = 19.23% of the total votes.
- Candidate B receives votes worth 30 coins. This is 30/130 = 23.07% of the total votes.
- Candidate C receives votes worth 45 coins. This is 25/130 = 34.61% of the total votes.
- Candidate A receives votes worth 30 coins. This is 25/130 = 23.07% of the total votes.
If we apply a majority vote, candidate C will win with a relative majority.
It is also possible to change the voting method to a positional or ranked voting system like Borda Method, Instant Runoff, or Coombs Method. The purpose of the coins is to weigh the votes and avoid Sybil attacks.
The advantage of this method is that it is rather simple to implement and to understand. Instead of coins, vote operators can also use tokens. The problem, however, is that the voting power and the influence depend on the wealth of this person. Besides that, centralized exchanges can use their customers’ coins to vote. They could also use those coins to vote against the interest of their customers.
