Governance Rights

Definition ∞ Governance rights in the context of digital assets refer to the privileges granted to token holders to influence the direction and parameters of a blockchain protocol or decentralized application. These rights typically include voting on proposals, electing representatives, or adjusting system settings. They are fundamental to the decentralized decision-making processes within these systems.
Context ∞ Discussions around governance rights are prominent in news concerning decentralized autonomous organizations (DAOs) and protocol upgrades. Reports often analyze the distribution of these rights, voter participation, and the effectiveness of various governance models. The ongoing challenge involves designing systems that balance broad participation with efficient and secure decision execution.