The System Traps of Governance

In my last post about feedback loops in governance, I talked about why systems behave the way they do. But sometimes, things go off track, not because people have bad intentions, but because systems fall into what we call governance system traps.

Trap 1: The Tragedy of the Commons

The Tragedy of the Commons trap happens when there’s a a shared resource that everyone benefits from, but no one feels responsible for. This leads to overuse, and eventually, collapse of the resource. Think of users endlessly submitting low-effort governance proposals to farm attention or incentives. Individually profitable, collectively unsustainable.

Trap 2: Drift to Low Performance

This trap happens when low participation becomes the norm, leading to performance quietly decaying. A common example is when Discords discussions fade into silence, apathy becomes the norm, and participation drops off completely.

Trap 3: Success to the Successful

This trap happens when early advantage leads to immense influence, often locking others out. For example, in token-based voting, insiders often dominate decision-making, discouraging new contributors and stifling innovation.

Trap 4: Shifting the Burden

This trap happens when instead of fixing the root issues in governance design, projects rely on temporary solutions. This is common in Web3, particularly when protocols rely entirely on core developers to make decisions, because DAO processes are too slow or inefficient to use. Over time, governance weakens and the core team burns out.

Conclusion

Governance doesn’t break randomly, it’s something we can predict. These system traps show us where things go wrong and how to design smarter, fairer systems. If we want decentralized governance to work, we have to outsmart these traps.

Until the next hash, Abed.