Reading about Namecoin, and this blog post (
http://paulbohm.com/bitcoin-decentralization/) gave me an amazing idea:
Similarly to Namecoin, Bitcoin's protocol could be extended to support another revolutionary new application: A secure, distributed method for holding elections for political office.
This would be a rather different notion of democracy (one that has been anticipated by early cypherpunks, e.g. see Greg Bear's sci-fi novel "Eon") - it's not "one person, one vote" but something more akin to "one hash, one vote".
Here's the idea: An election is happening. If you want candidate "X" to win, you insert candidate "X"'s name as an extra attribute attached to the block candidate you are currently trying to hash (supposing the Bitcoin protocol was extended to accept extra attributes). Each participant is allowed to add such a block to the chain as many times as desired - but you have to do the proof-of-work (find the nonce) each time.
The election is declared to be over when a certain (predefined) block number is reached.
To determine who won, anyone can simply examine the public block chain and count up the votes for all the different candidates. Whoever has the most votes wins (or, if no one has a majority, you could hold a runoff election).
This idea works well with pooled mining - during an election, each pool can announce that it is supporting a given candidate (tagging all their blocks with that party's candidate), and individual miners can work for whichever pool supports their preferred candidate. (Of course, there is no limit to the number of candidates, since there is no limit to the number of pools that may be created.) Pools would become like political parties, and the biggest pools would have the most political power. People with a given political viewpoint would tend to congregate together with each other into one pool.
The reason this system is revolutionary is that suddenly you don't have to trust election authorities or voting machines to count the votes properly. Everyone can have confidence that the outcome reflects the true preference of the electorate (where in this case, the electorate is defined as people who control computing power).
Such a system is perhaps less ideal than "one person one vote" democracy, but, since it is at least possible to implement it in a secure, trustable way, it may become a more successful political system than "human-centered" democracy in the long run.
