I am back at my keyboard now so I am just going to try to write a single response that answers all of your questions.

Fundamentally there are two problems in democratic politics that voters need to figure out:

1 - Are the goals of the politician aligned with my own goals? 2 - Is the politician competent enough to accomplish their goals?

Truthcoin may possibly make it slightly easier to determine #2 at the cost of making it far, far more difficult to determine #1.

Votecoiners are not punished/rewarded on the basis of their ability to report facts about the outside world, but instead on their ability agree with each other. The problem with votecoin is that it is not a naturally stable system- it is a naturally unstable system that deteriorates into an autocracy because there are no outside forces to ensure sanity of the system and the only incentive for votecoiners is to agree with each other. It works if you consider votecoiners reporting on something neutral, like a throw of a dice (assuming that 51% of votecoiners will not be able to coordinate with each other).

The problem comes into play when votecoiners must decide the outcome of an event that is subjective, which allows them to signal to each other to conspire.

Take for instance the 2020 presidential election. Now, we can probably agree that Biden/Dems won the election. However, many republicans (including trump himself) pushed a narrative that there was election fraud. Regardless of what actually happens, any indecision will fork the votecoiners in a way that is politically biased: Either the democrat votecoiners outnumber the republicans or vice-versa. The result is that one group of votecoiners will be ejected for their political beliefs.

The extent to which votecoiners are politically forked increases with the number of votecoiners that are politically biased: in other words, it spirals out of control. Even if only a small % of republican votecoiners disagree with the rest of the votecoiners, that will irreversibly bias votecoin in favor of the democrats in a way that will only accelerate over time.

That is to say, if there are 30% Democrat votecoiners and 20% Republican republican votecoiners, next time there will be 31% Democrat votecoiners and 19% Republican votecoiners, and the next time there will be 33% Democrat votecoiners and 14% Republican votecoiners, and the next time there will be 40% Democrat votecoiners and 7% Republican votecoiners, and so on. There is no incentive structure in votecoin that decelerates this trend.

It does not reach a stable-state because the rate at which one party is persecuted increases over time. Eventually, even neutral votecoiners will have to satisfy the party with the majority votecoin stake just so they don't get kicked off. Once there is a significant-enough subjective event that votecoiners have to decide on, the ownership of votecoin must "snowball" into being ideologically controlled. It does not even matter if the vast majority of votecoiners start out neutral: for example if 2% of votecoiners are republican, 1% are democrat, and 97% are neutral, then the republicans will slowly take over and force the neutrals to agree with them.

You might say that in this case, the republicans should be kicked out because the fact is that the election was not rigged. But this is a very dangerous precedent. Almost every religion is based on some belief in the supernatural, almost every nation is built on a shared cultural narrative that is not completely true, almost every decision in the free market involves people gambling on externalities that they cannot objectively determine the outcome of. Truthcoin will generally punish people for having a radically different interpretation of the facts, which is a healthy part of society as a stable-state system: people naturally distrust and work against powerful systems and this is why businesses, empires, religions become less efficient at great scale and will reach a maximum size. It is analogous to how the inverse square law limits the size of an organism.

Religions, Cultures, Political groups do not compete in the sense that their ideas are literally true. They compete in the sense that they are useful for the believer. Why is democracy "truer" than dictatorship? Here is a simple answer: if the nazis and japs had won WW2 we would be speaking german and wondering why dictatorship is "truer" than democracy. Societies already have means to determine the truth of their ideas: trade and war. Truthcoin is merely a system for self-righteous people to co-ordinate a radical conspiracy against democratic society.