While many startups rush to be first, 0x (ZRX) has taken a more methodical approach to smart contract development. But there’s one thing the team is itching to implement: a new governance system.
0x improvement proposals, or ZEIPs, fuel the decision-making process for the decentralized trading protocol, and will form the launchpad for the emerging voting system. 0x Co-Founder Will Warren is trumpeting the change, saying in a recent Reddit post that the community would have “some opportunities to get their hands dirty in 2019.”
If you’ve never heard of ZEIPs, it’s because 0x developers have held them close to the vest until now. These proposals have been a component of the project since before v1.0 was unveiled (they’re now on v2.0), but key decisions in smart contract upgrades were left to the core team .
Now 0x is ready to share the ZEIP process with the community, as an early form of governance begins to unfold. The timing has to do with the migration to 0x v2.0, which has resulted in what the project describes as a “tighter smart contract cycle.” Security audits for new features can now be completed in weeks instead of months, reflecting a maturing project and an opportunity for the community to get involved with “vetting and prioritizing” ZEIPs.
Similar to their approach to smart contracts, 0x software devs are taking governance slowly, despite their desire to put new procedures in place. Rather than becoming a guinea pig for the voting process, they are hoping to learn more from the problems that have arisen within other projects. For instance, voting cartels could form, in which a group of nodes or investors band together to take control of the direction of the project.
0x’s voting process won’t be “bound by the blockchain consensus,” at least not yet. Warren stated in a blog post:
While it is premature to put a binding on-chain governance system in place, I believe we need to set a precedent that all safety-critical changes are vetted and confirmed by the community by way of a token vote.
Pipeline of ZEIPs
0x has yet to unveil the token requirements for participating in the voting process, but they have revealed a pipeline of ZEIPs for the community to consider in the coming months.
Among them, ZEIP-24 is a proposal for the ERC-1155 token standard, which is designed to go where ERC-20 and ERC-721 tokens cannot. That’s because this multi-token standard uses an Ethereum smart contract with multiple functionality — it stores both “fungible (identical) and non-fungible (unique) tokens” in the same contract. This “eliminates the need to deploy numerous ERC-20 contracts,” thereby placing a smaller burden on the network itself.
ERC1155 is a new Ethereum token standard that I expect to become widespread in the next 6 months. It allows an unlimited number of digital asset ledgers to be maintained within a single contract. Ideal for game items, debt assets, and prediction markets. https://t.co/TSDC167UZ1 pic.twitter.com/ZNrPtjyzEf
— Will Warren (@willwarren89) January 22, 2019
Another is ZEIP-X, a proposed “Trade Execution Coordinator” to implement strict rules for token trading on the blockchain protocol. Through a set of smart contract rules, the proposed TEC would “prevent front-running/trade collisions and allow for free off-chain order cancellations,” potentially allowing price discovery to become more efficient.
0x’s methodical approach to smart contracts and governance alike seems to suit the community, which has responded favorably to the prospect of more public decision-making. Now that they’ll have the chance to get their hands dirty, though, we’ll see if their enthusiasm lasts.
The author is invested in digital assets, but none mentioned in this article.