Ecosystem Update on Decentralizing Governance
COMMUNITY
October 23, 2022
A few weeks ago, the NEAR Foundation announced the formation of a new entity designed to help accelerate the decentralization of the NEAR ecosystem (you can read this forum post here). 

The Foundation received an incredible amount of thoughtful feedback about the NDC and how it would function. As a result, the Foundation has been working with its partners on how best to take this project forward. This post is an update about the progress so far. 

Why does decentralization matter?
Decentralization is shifting the locus of power away from a central node to several smaller nodes and setting up processes to establish group consensus without relying on hierarchies or top-down structures. NEAR was always designed to be run and owned by its community. The Foundation believes the unique properties of a fully decentralized ecosystem make NEAR: 

Antifragile and resilient: having no single honeypot or single legal entity will make NEAR stronger against attacks and challenges.

Censorship resistant: without central parties, no one party can control the network nor take over the ecosystem. 

Adaptable: the system can learn and adapt quickly in different directions to find the right levers of growth.

Inclusive: more voices are involved and heard. 

How will we measure our progress?
It’s important that the progress of this work is measurable and transparent. The intention is to decrease the ownership percentage of key infrastructure by both the NEAR Foundation and Pagoda over time. Those groups identify the following metrics as the key indicators of a successful ecosystem: 

Funding: treasury management and diversification
Protocol operations: validator ecosystem & decentralization
Core development: the protocol and developer ecosystem
Governance and decision-making: decentralization and transparency
Brand: awareness, traction, consistency
Ecosystem services: founder support (legal, marketing, ops, community) 
App layer: tooling, number of projects building, active users
How will we achieve optimal decentralization?
This is the project of the next several months, under the continuing stewardship of the Foundation and Pagoda. The goal here is to simplify and align while encouraging the broadest possible participation from contributors to our ecosystem and community. 

A node architecture applies to the NEAR ecosystem as well as to the tech: every company, DAO, validator, fund is a hub in the NEAR constellation of nodes, all on an equal playing field in terms of their ability to contribute to decision-making and development. This constellation of nodes will work together in a decentralized but coordinated way. The Foundation is currently applying structure around nodes to define levels of accountability and extent of participation in governance processes. 

What is the role of NDC? 
The NEAR Digital Collective (NDC) is a new way of organizing the fast-growing community of users, projects, stakeholders, partners, and backers building inside the NEAR ecosystem. Its ultimate goal is to create a cohesive structure that allows all the component parts of the NEAR ecosystem to collectively decide how NEAR should be run. The NDC will work with the Foundation, Pagoda, and other ecosystem nodes over the coming months to develop a structure and make its first proposals to the community. 

Version one of the governance framework is underway. This framework is the NDC’s vision for a decentralized governance system and core governance components. When complete it will provide details of roles, responsibilities, participation rules, and dispute resolution processes.

In addition, a communications strategy is being developed which will help the community stay up to date with the NDC’s progress.

NDC updates will be posted on the NEAR Forum. If you’d like to get involved with the NDC, you can do so here. 

The NEAR Foundation would like to thank the community for your enthusiasm and input throughout this decentralization process. Striking the right balance between moving fast and growing wisely is always a challenge in the fast-paced world of Web3 and it’s more important than ever to work together. NEAR is well-positioned for the next phase of growth and making sure everyone is strategically and operationally aligned now will help achieve much greater success in the future.