A token governance model defines how decisions are made and implemented within a decentralized protocol or ecosystem using its native token. This system typically grants token holders voting rights proportional to their holdings, allowing them to propose and vote on changes to the protocol’s parameters, upgrades, or treasury allocations. It establishes a framework for collective decision-making, aiming to decentralize control and ensure community input. The model’s design influences the project’s long-term direction.
Context
The effectiveness of a token governance model is a recurring theme in discussions about decentralized autonomous organizations (DAOs) and protocol evolution. News often covers significant governance proposals, voting outcomes, and debates around voter participation or centralization of power. Designing equitable and efficient governance models remains a critical challenge for many decentralized projects.
The new TWT model fundamentally shifts DAO participation by linking governance rights and deflationary mechanics directly to on-platform utility and user loyalty.
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