# New Zealand Retirement Savings Proposal (NZRSP)
## Abstract
This proposal outlines a decentralized retirement savings system for New Zealand that uses age-based tranches, democratic governance through quadratic voting, and zero-knowledge identity verification via NZ passports. The system aims to provide transparent, community-governed retirement savings while maintaining privacy and preventing plutocratic control.
## Motivation
Current retirement savings systems lack transparent governance and direct participant input into investment strategies. This proposal addresses these issues by:
- Enabling democratic decision-making among contributors
- Preventing wealth concentration from dominating fund direction
- Maintaining privacy through zero-knowledge proofs
- Reducing administrative overhead through automation
## Specification
### 1. Tranche Structure
**Age-Based Segmentation**: Participants are allocated to tranches based on birth year, creating cohorts with similar retirement timelines and risk tolerances.
- Each tranche operates semi-independently with its own governance
- Risk profiles automatically adjust as tranches age (e.g., 1990 cohort has different allocation than 1960 cohort)
### 2. Governance Mechanism
**Voting Rights**:
- Voting power derived from total contributions to a specific tranche
- Quadratic voting applied: voting weight = √(total_contributions)
- Prevents disproportionate influence from large contributors while rewarding participation
**Example**: A contributor with $100,000 has voting weight of 316, while a contributor with $10,000 has weight of 100. The larger contributor has 10× the capital but only 3.16× the voting power.
### 3. Identity Verification
**zkPassport Integration**:
- Utilizes cryptographic keys embedded in NZ e-passports
- Zero-knowledge proofs enable:
- Anonymous participation in age-specific pools
- Birth year verification without revealing identity
- Proof of NZ citizenship/residency
- Prevention of duplicate voting
**Privacy Guarantee**: Participants prove eligibility without disclosing personal information to the fund, other members, or blockchain.
### 4. Organizational Structure
**Dual Governance Model**:
**DAO (Decentralized Autonomous Organization)**:
- Executes investment decisions approved by tranche members
- Manages automated rebalancing and yield strategies
- Enforces rules through smart contracts
- Handles routine operations without human intervention
**Board of Directors**:
- Oversees DAO parameter settings
- Handles regulatory compliance and reporting
- Manages external relationships (custodians, auditors)
- Mandated to progressively automate their functions into the DAO
- Compensated via small percentage of generated yields
### 5. Funding Model
**Board Compensation**: Funded by 0.X% management fee on investment returns, incentivizing:
- Capital preservation
- Yield generation
- Operational efficiency
- Automation development
### 6. Fork Mechanism
**Philosophical Divergence Protocol**:
- If significant governance disagreements arise, tranches may vote to fork
- Capital split proportional to voting outcomes
- Enables competing strategies without forcing consensus
- Maintains individual sovereignty over retirement savings
## Rationale
**Quadratic Voting**: Balances plutocracy concerns with the principle that larger contributors have legitimate interest in fund direction.
**Age Tranches**: Aligns risk tolerance and time horizons, preventing young contributors from being bound by conservative strategies of near-retirees.
**zkPassport**: Leverages existing government infrastructure while preserving privacy—no centralized database of participants required.
**Fork Right**: Provides exit mechanism if governance becomes captured or philosophically misaligned with member values.
## Implementation
### Phase 1: Smart Contract Development
- Quadratic voting mechanisms
- Tranche management logic
- zkPassport verification integration
### Phase 2: Legal Framework
- Regulatory approval from NZ Financial Markets Authority
- Trust structure or similar legal entity
- Tax treatment clarification
### Phase 3: Pilot Program
- Launch with limited tranches
- Test governance mechanisms
- Refine automation parameters
### Phase 4: Full Deployment
- Open to all eligible NZ residents
- Integration with existing KiwiSaver portability
- Ongoing DAO/Board refinement
## Security Considerations
- Smart contract audits by multiple independent firms
- Custodial arrangements for fiat-crypto bridges
- zkPassport implementation security review
- Governance attack vectors (especially during fork events)
## Conclusion
This proposal creates a transparent, democratic retirement savings system that respects privacy, prevents plutocratic control, and enables philosophical flexibility through forking. By leveraging existing passport infrastructure and modern cryptographic techniques, it provides a path toward community-governed financial security for New Zealanders.
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**Status**: Draft
**Category**: Social/Financial Infrastructure
**Created**: 2025-10-12 by hindsight.eth
