Meritocracy is the concept on which the logic of token distribution in Free TON — and even broader — the entire philosophy of the platform is based. Blockchain creators could have gone the traditional path, announcing crowdfunding or placing an initial coin offering on an exchange. But a different path was chosen — to become a blockchain, with cryptocurrency distributed among the winners of contests.
“The power of the worthy” is a social ideal and a popular political science concept that is being tried to implement in vast closed social systems. For example, in nation-states (Singapore, UK, USA) or large corporations (Amazon, Uber). The term “meritocracy” was first used by the philosopher Hannah Arendt in 1954, and it was given wide publicity in a satirical essay written in 1958 by the sociologist Michael Young.
Ideally, meritocracy should act as a new form of public goods distribution, devoid of the diseases of traditional society. Social status here should not be determined by connections, the financial wealth of parents, inherited status, or simply nepotism — in a meritocratic system, people move up only through their abilities and diligence. Sociologists warn that despite its good intentions and obvious advantages, meritocracy also carries the danger of pushing society into a new phase of inequality. But let’s not talk about it for now.
Non-financial Terms Of Distribution 5 Billion
All five billion TON Crystal tokens are distributed on non-financial terms. One time it was guaranteed by 5 people — the Payment Delegated Group (PDG), formed from the initial members who sign the transfer of funds from the givers. Their functions are purely technical and temporary — we will explain this a little later. Now this is guaranteed by the 23 initial members.
Givers are three smart contracts for which all tokens were distributed at the start of the platform in the following ratio.
- 5% of TON Crystal, which is two hundred and fifty million tokens, were distributed to Validator Giver and intended for validators as a reward for ensuring that the entire network is up and running.
- 10% of the tokens — five hundred million — were transferred to Developer Giver. These funds are intended to reward developers who develop the Free TON technology platform. For example, these are prizes for the first places in the contest for the development of TIP — key technological solutions of the platform.
- 85% of TON Crystal — four billion two hundred and fifty million – went to Referral Giver, a smart contract that distributes tokens to the initial users of the cryptocurrency. The distribution is free for participating and winning contests, which are announced and approved by the community itself.
To implement the principles of meritocratic token distribution, the Governance 2.0 management system is being implemented in Free TON.
Any member of the platform can propose any contest. This proposal appears in the general forum, where all members of the community can discuss it. After the proposal is discussed, the SMV voting stage takes place.
Also, tokens placed in Referral Giver are intended for community partners. For example, this concerns one of the latest news — it is estimated that about 280 thousand crystals will provide the process of merging Free TON and Freeland. Funds from the same giver provide a partnership with the Dune blockchain, which will cost the Free TON community nine million.
Like contest decisions, partnership decisions are made through an SMV vote and with the same motivation — whether the partnership will contribute to the development of the platform.
A separate object of expenditure of this wallet is to support subgovernance activities. Subgovernance is divided into two groups — national subgovernance, whose activities are aimed at adapting the platform to the specifics of work in a certain region, and subgovernance, specializing in a particular type of activity.
Subgovernances are headed by their initials — the persons who initiated the creation of a particular subgovernance. Funds allocated to subgovernances are distributed to their representatives through contests, and subgovernance initial members put the signature for issuing these funds.
Schematically, the distribution of funds looks like this:
In fact, Referral Giver is the main wallet from which cryptocurrency is distributed to community members, so special attention is paid to the procedure of this distribution. As already mentioned, the PDG puts the last signature that authorizes the issuance of funds from the giver. This signature confirms that all procedures consistent with the concept of meritocratic distribution have been followed.
The procedures are automated as Governance 2.0 and represent two voting mechanisms: the soft majority voting system (SMV) and the judging and jury system, or BFTG. Each of these systems is a holistic and connected system of smart contracts which allows any initiative from community members to go from idea to reward. We already described how it was solved and technologically developed.
As illustrated below, it all starts with a proposal — about a partnership, a contest, etc. The proposal discussion stage and the SMV voting follow this. If the proposal passes, a contest is announced, the results of which are judged using the BFTG system, and the winners receive rewards in tokens — this is the very part of the allocation of funds from the giver when the PDG signature comes into play. It is now. After the full introduction of Governance 2.0, which is now being actively optimized, will be fully automated, and the need for a signature will disappear.
If You Want To Have More, Be Smarter, Work Harder
The distribution system aims to ensure that the most capable community members – the winners of the contests — gradually find themselves in priority positions in the ecosystem. After all, as we remember, in Free TON everything is voted on, and the number of tokens the voter has provides the weight of each vote. In the long term, we can expect to build a certain hierarchy among the community members.
Hierarchy is the main reason for criticism of meritocracy by a number of researchers. For all the advantages of meritocracy, which ensures upward social mobility only through intelligence and hard work, it quite obviously leads to inequality. But while in a traditional society inequality is most often the result of injustice, with a meritocratic distribution of goods, inequality is deprived of signs of injustice.
“The Paradox of Meritocracy”
Hierarchy becomes a source of danger that comes from meritocracy. For example, Emilio Castilla, a researcher at the Massachusetts Institute of Technology, has researched discrimination in a large organization whose activities are organized according to meritocratic principles. At the start of the research, it was thought that an organization where the most productive employees were rewarded, regardless of their gender, race, religion, etc., should be the least susceptible to discrimination. The result turned out to be the opposite — other things being equal, representatives of vulnerable groups (e.g., emigrants) had to work harder and more diligently to get their abilities assessed at the same level as others.
Community participants tended to recognize the merits of majority representatives, such as the indigenous population, when making their assessments. There is an explanation for this: just the meritocratic principle in such groups does not work, and differentiation is not by ability, but by preference.
Hopefully, the pitfalls of meritocracy identified by the researchers, which affect its social adaptation in classical communities, are less inherent in the crypto community. Anyway, Free TON is not just a currency, it’s also a bold social experiment.