Futarchy

The slogan sums up the mechanism: vote on values, but bet on beliefs. First the organization democratically defines a welfare metric or objective. For each proposal, conditional prediction markets open, one conditional on approval and one conditional on rejection. Participants bet on the expected value of the metric under each scenario, and the relative price reveals which decision is expected to maximize welfare. The policy the market forecasts as superior is executed, because a prediction market aggregates information better than a survey or a simple vote.

Futarchy replaces voters' aggregated judgment with a prediction market's price as the decision engine, separating preferences (which are voted) from forecasts (which are bet). Its direct link to the prediction market concept is what sets it apart from other on-chain governance models.