DerivaDAO Governance

Introduction to the DerivaDAO

The DerivaDEX protocol is governed by the DerivaDAO. DAO is shorthand for “decentralized autonomous organization”, a concept often used in decentralized applications to refer to smart-contract based governance, where token holders are able to make proposals regarding changes to a protocol, and vote on them.

Governance structure

The DAO and voting power

All DDX token holders participate in governance, with voting power proportional to their token holdings.

Governance decisions include:

• Approving protocol updates

• Managing DAO-owned funds

• Appointing Bond Providers and Foundation directors

Types of proposals

1. On-chain Proposals: Direct changes to protocol code or smart contracts.

2. Hybrid Proposals: Combine on-chain changes with off-chain activities.

3. Off-chain Proposals: Non-binding, ratified by the DAO.

Proposal process

1. Draft Creation: Shared on the Governance Forum.

2. Security Council Review: Assesses potential risks.

3. DIP Submission: Created and submitted on the DIPs Repository.

4. Voting: Open for 3 days; 4% quorum needed.

5. Execution: If approved, the proposal is implemented on-chain.