I agree with Rikard.Korpklo and Plainswalker, but quick note here: When you say democracy, you mean choosing officials, not chosing laws. I consider this distinction important because even though the word democracy has been the victim of an orwellian nightmare for the last two hundred years, we are talking about designing a new government from scratch and things should be crystal clear. I do not mean I am in favor or against a system in which citizens directly vote laws and political meassures, I just mean we should make clear the distinction when what we mean is citizens voting representatives, who in turn vote laws and meassures. Currently there is not a single democratic country on Earth, in part because it is technologically impossible to have millions of people communicate horizontally in a fast manner and decide what to do about a particular matter.
For the case of Asgardia, I think we could put the power of both extremes at work (the purely democratic, horizontal one and the purely technocratic, oligarchic version of government. "One alone cannot suffice", as monirzaman said.
This is, imagine we choose a representative among a pool of specialists to deal with a problem or a set of problems that fall within their area of expertise. Even if we have all non-elected specialists vote, or only specialists voted a person for such position, in the end we would have one person dealing with the thinking, and that is limited. We would be depriving Asgardia of the ideas and judgement of all other specialists.
On another hand, if we had everyone decide what to do about our afformentioned set of problems, or who to entrust with dealing with it, we would be letting the choice rest upon plenty of people who actually have no clue what they are working with. It is then when masses choose actions and representatives based on fallible criteria such as looks, fears, etc. And they choose wrong.
So instead, we could have all experts in a particular problem comprise relatively small assemblies to vote meassures horizontally. That way we would take advantage of all and the best of the available judgement. Non-experts could be allowed to talk in a particular assembly if they thought their testimony could be of any use.