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Judicial governance is one of [[Governance|three branches of governance]] in a [[DAO]]. Judicial governance is the means of reviewing past actions and revaluating their worth. Under [[DAO Governance Framework|DGF]], the two main types of judicial governance are arbitration and Forum revaluation. Arbitration allows conscious intervention to adjust the standard automated outcome of a smart contract. Forum revaluation changes the REP token holdings of posts in the Forum through leaching and donating references.
Judicial governance is one of [[Governance|three branches of governance]] in a [[DAO]]. Judicial governance is the means of reviewing past actions and revaluing their worth. Under [[DAO Governance Framework|DGF]], the two main types of judicial governance are [[Judicial governance#Arbitration|arbitration]] and [[Judicial governance#Forum revaluation|Forum revaluation]]. Arbitration allows conscious intervention to adjust the standard automated outcome of a smart contract. Arbitration is more immediate, usually requiring an individual judge's decision. Forum revaluation is more deliberate and takes more time, requiring the weighted-democratic consensus of the larger DAO. Forum revaluation changes the REP token holdings of posts in the [[Forum]] through leaching and donating references from new validated posts.  


== Arbitration ==
== Arbitration ==
''Main page: [[Arbitration smart contract]]''
''Main page: [[Arbitration DAO]]''


The basic type of judicial governance is arbitration. Arbitration allows a DAO to review the automated outcome of a work smart contract (WSC). The "code is law" assumption of Web3 makes such review difficult in a primary DAO. Nevertheless, the code is law standard is necessary when a DAO allows open access to pseudonymous members.  
An Arbitration DAO (arbDAO) is a group of judges who resolve disputes that arise in the course of immediate business. In any DAO which employs a work smart contract (WSC), when one or more of the parties is dissatisfied with the execution of the contract, they may trigger an arbitration clause in the WSC, which transfers the assets encumbered in the WSC to a judge in the arbDAO. The judge then resolves the dispute according to the standards of the arbDAO.  


However, rigid contracts following code is law are not good for business. Business contracts demand all parties perform in a predictable manner under assumptions about the future business environment. However, no one can predict the future. Business must be able to continue when an eventuality occurs that was not anticipated in the smart contract. Parties to the smart contract must be able to come to some consensus on what is fair in those circumstances. The existence of a meaningful reputation system motivates the parties to behave as well as possible. But sometimes, even if both parties are behaving with the best intentions of honoring the spirit of good business, irreconcilable differences in perspective about what is fair are inevitable. In such cases a third party is necessary to adjudicate and resolve the dispute.
Arbitration is the immediate type of [[judicial governance]]. Importantly, the arbitration clause must be triggered before the WSC is concluded. Otherwise the dispute must be resolved by the lengthier review of [[Judicial governance#Forum%20revaluation|Forum revaluation]].


To achieve this type of judicial governance in a primary DAO while respecting the standard of code is law, the WSC must therefore include a clause that allows any party in the smart contract to trigger a sub-contract, called an arbitration smart contract (arbSC).
== Forum revaluation ==
''Main page: [[Judicial governance proposal]]''


When arbSC is triggered, the WSC sends all its encumbered REP tokens, fees, and other property to the arbSC, which then follows the basic [[work flow]] of DGF. Specifically, the arbSC then calls arbitrator(s) from the arbDAO to do the work of the arbSC. This means the arbitrators follow the established arbDAO protocols for resolving a dispute between parties to the WSC. The arbitrators were first selected (usually randomly) by the arbSC from the currently functioning availability smart contracts (ASCs) from the arbDAO bench. Once the work of arbitration is finished off chain, the arbSC concludes by submitting evidence of its work to the Forum for recording and initiates a [[Validation Pool]] to disburse the fees and mint new arbREP.
=== Overview ===
Under DGF, anyone can appeal to a DAO to redress any perceived injustice by posting a [[Judicial governance proposals|judicial governance proposal]] in the Forum. This leads to a review of the current state of REP holdings and may lead to REP redistribution by the mechanisms discussed in this section.


The arbSC will typically itself include a clause which allows unsatisfied parties to trigger another arbSC, iteratively according to the standards set by the original WSC.
A basic example of perceived injustice includes punishing actions that had previously been rewarded in the past, but are now perceived as harmful to the DAO. For instance, if a [https://www.reddit.com/user/Ursium/comments/wp561e/explaining_the_dao_one_last_time_an_open_letter/ corrupt smart contract] was accidentally instituted in a DAO with a bug that siphoned REP tokens to the perpetrator, then Forum revaluation can be used to remove those tokens from the perpetrator and burn them. A second basic example of injustice is the opposite: when a past action was not properly rewarded, but later the DAO recognizes it was valuable. Then new REP tokens can be minted and donated to the hero.  


== Forum revaluation ==
Each DAO records its history in its [[Forum]], which is a collection of posts linked by weighted references. Together with the initial values of the posts (as determined by the Validation Pool that [[Validation Pool#Mint new REP|mints the REP]] for each post), the references determine the overall REP distribution in the DAO, i.e., the distribution of power. This second type of judicial governance, Forum revaluation, redistributes power from one post to another. This redistribution is achieved by making a new post which has new references to the posts which need to be revaluated. If the new post is validated and supported by REP-weighted democracy through the Validation Pool mechanism, then the redistribution is achieved.
Under DGF, anyone can appeal to a DAO to redress any perceived injustice by posting a proposal in the Forum. This leads to a review of the current state of REP holdings and may lead to REP redistribution by the mechanisms discussed in this section.
 
Since the Forum is technically a WDAG (weighted directed acyclic graph), judicial governance is technically the process by which the WDAG is reweighted. This judicial governance mechanism is necessary for instituting an evolutionary structure which converges on ever greater security.  


A basic example of perceived injustice includes punishing actions that were rewarded in the past, but are now perceived as harmful to the DAO. For instance, if a [https://www.reddit.com/user/Ursium/comments/wp561e/explaining_the_dao_one_last_time_an_open_letter/ corrupt smart contract] was accidentally instituted in a DAO with a bug that siphoned REP tokens to the perpetrator, then Forum revaluation can be used to remove those tokens from the perpetrator and burn them, or donate them to a worthy member.  
Judicial governance in a DAO is fundamentally a matter of approving token ownership in the DAO. The more visible, secondary function of judicial governance is the review of REP token accounts. Judicial governance allows a DAO to re-evaluate REP holdings by slashing accounts that were later determined to have harmed the DAO, or augmenting accounts that had a later positive affect.


Each DAO records its history in its [[Forum]], which is a collection of posts linked by weighted references. Together with the initial values of the posts (as determined by the Validation Pool that [[Validation Pool#Mint new REP|mints the REP]] for each post), the references determine the overall REP distribution in the DAO--i.e., the overall distribution of power in the DAO. This second type of judicial governance redistributes power from one post to another. This redistribution is achieved by making a new post which has new references to the posts which need to be revaluated. If the new post is validated and supported by REP-weighted democracy through the Validation Pool mechanism, then the redistribution will be achieved.  
Inasmuch as business and social decisions are inevitably flawed, this function is necessary for the long-term stability of a DAO. It is necessary for a mechanism of review to exist. However, in a healthy DAO it will rarely be used, compared with the other two branches of government.


Reputation tokens should be slashed for two basic reasons: first, when members violate explicit protocols, even though the violation was not detected by automated executive policing; second, when members betray the more abstract values the DAO shares which have not been explicitly encoded in automated protocols--[[transcendent values]]. Judicial governance also allows more accurate accounting of power after a DAO updates its values or protocols. Judicial governance is therefore fundamental in incentivizing members to behave well, because if it is functioning properly, judicial governance imbues REP tokens with some of the crucial qualities that characterize authentic reputation: future-orientation and non-fungibility.
=== Forum reference mechanisms ===
=== Forum reference mechanisms ===
''Main page: [[Forum reference mechanisms]]''
''Main page: [[Forum reference mechanisms]]''


The specific reference mechanisms which support judicial governance under DGF are leaching and donating. Combined with an incinerator function, these primitives are [[Forum reference mechanisms#Completeness|complete]], in the sense that using only those functions, any possible [[Forum]] WDAG can be re-weighted in any way desired.
The specific reference mechanisms which support judicial governance under DGF are leaching and donating. Combined with an incinerator function, these primitives are [[Forum reference mechanisms#Completeness|complete]], in the sense that using only those functions, any possible [[Forum]] WDAG can be re-weighted in any way desired.  
 
=== Governance tax ===
To achieve Forum revaluations, governmental intervention is required through revaluation primitives.
 
??reword: A basic principle of REP governance through the Forum reference mechanism is that REP actually doesn't cost anything directly. Revaluation is just a function of a certain percent of all new posts to tie REP minting and burning to real cash. If every Work SC is required to use a fixed percent ''g'' of the new REP minted with it to do governance then all Work REP is still the same value as any other contract. If no governance needs to happen at a particular moment then the g percent can be burned to keep that contract the same value as others and the price of governance is still bound by ''g'' percent. The DAO should in general be happy when REP is burned instead of redistributed by governance, even the particular worker as long as every SC does the same, because it means the REP they do have is more valuable. It all works out following the quantity theory of money that if you have the same proportion of total tokens then you have the same proportion of power and reward, whether the absolute number of tokens is up or down.


UIs can automatically calculate the estimated present value of our tokens based on the tokenomics formulas, to give users a sense of what the tokens mean without requiring the users to make the mental estimates.
To achieve Forum revaluations, governmental intervention is required through revaluation primitives, which need to be funded by a [[Forum reference mechanisms#Governance tax|governance tax]]. This overhead is necessary since governance is not directly profitable, but still essential to the long-term stability of the DAO. With DGF, this governance tax can be instituted in a far more transparent and equitable manner with P2P protoocols.


==Applications==
==Applications==

Latest revision as of 11:34, 3 July 2023

Judicial governance is one of three branches of governance in a DAO. Judicial governance is the means of reviewing past actions and revaluing their worth. Under DGF, the two main types of judicial governance are arbitration and Forum revaluation. Arbitration allows conscious intervention to adjust the standard automated outcome of a smart contract. Arbitration is more immediate, usually requiring an individual judge's decision. Forum revaluation is more deliberate and takes more time, requiring the weighted-democratic consensus of the larger DAO. Forum revaluation changes the REP token holdings of posts in the Forum through leaching and donating references from new validated posts.

Arbitration[edit | edit source]

Main page: Arbitration DAO

An Arbitration DAO (arbDAO) is a group of judges who resolve disputes that arise in the course of immediate business. In any DAO which employs a work smart contract (WSC), when one or more of the parties is dissatisfied with the execution of the contract, they may trigger an arbitration clause in the WSC, which transfers the assets encumbered in the WSC to a judge in the arbDAO. The judge then resolves the dispute according to the standards of the arbDAO.

Arbitration is the immediate type of judicial governance. Importantly, the arbitration clause must be triggered before the WSC is concluded. Otherwise the dispute must be resolved by the lengthier review of Forum revaluation.

Forum revaluation[edit | edit source]

Main page: Judicial governance proposal

Overview[edit | edit source]

Under DGF, anyone can appeal to a DAO to redress any perceived injustice by posting a judicial governance proposal in the Forum. This leads to a review of the current state of REP holdings and may lead to REP redistribution by the mechanisms discussed in this section.

A basic example of perceived injustice includes punishing actions that had previously been rewarded in the past, but are now perceived as harmful to the DAO. For instance, if a corrupt smart contract was accidentally instituted in a DAO with a bug that siphoned REP tokens to the perpetrator, then Forum revaluation can be used to remove those tokens from the perpetrator and burn them. A second basic example of injustice is the opposite: when a past action was not properly rewarded, but later the DAO recognizes it was valuable. Then new REP tokens can be minted and donated to the hero.

Each DAO records its history in its Forum, which is a collection of posts linked by weighted references. Together with the initial values of the posts (as determined by the Validation Pool that mints the REP for each post), the references determine the overall REP distribution in the DAO, i.e., the distribution of power. This second type of judicial governance, Forum revaluation, redistributes power from one post to another. This redistribution is achieved by making a new post which has new references to the posts which need to be revaluated. If the new post is validated and supported by REP-weighted democracy through the Validation Pool mechanism, then the redistribution is achieved.

Since the Forum is technically a WDAG (weighted directed acyclic graph), judicial governance is technically the process by which the WDAG is reweighted. This judicial governance mechanism is necessary for instituting an evolutionary structure which converges on ever greater security.

Judicial governance in a DAO is fundamentally a matter of approving token ownership in the DAO. The more visible, secondary function of judicial governance is the review of REP token accounts. Judicial governance allows a DAO to re-evaluate REP holdings by slashing accounts that were later determined to have harmed the DAO, or augmenting accounts that had a later positive affect.

Inasmuch as business and social decisions are inevitably flawed, this function is necessary for the long-term stability of a DAO. It is necessary for a mechanism of review to exist. However, in a healthy DAO it will rarely be used, compared with the other two branches of government.

Reputation tokens should be slashed for two basic reasons: first, when members violate explicit protocols, even though the violation was not detected by automated executive policing; second, when members betray the more abstract values the DAO shares which have not been explicitly encoded in automated protocols--transcendent values. Judicial governance also allows more accurate accounting of power after a DAO updates its values or protocols. Judicial governance is therefore fundamental in incentivizing members to behave well, because if it is functioning properly, judicial governance imbues REP tokens with some of the crucial qualities that characterize authentic reputation: future-orientation and non-fungibility.

Forum reference mechanisms[edit | edit source]

Main page: Forum reference mechanisms

The specific reference mechanisms which support judicial governance under DGF are leaching and donating. Combined with an incinerator function, these primitives are complete, in the sense that using only those functions, any possible Forum WDAG can be re-weighted in any way desired.

To achieve Forum revaluations, governmental intervention is required through revaluation primitives, which need to be funded by a governance tax. This overhead is necessary since governance is not directly profitable, but still essential to the long-term stability of the DAO. With DGF, this governance tax can be instituted in a far more transparent and equitable manner with P2P protoocols.

Applications[edit | edit source]

Code[edit | edit source]

See Also[edit | edit source]

Notes & References[edit | edit source]

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