[Informative] DAOFIN: Balanced Governance (Part-3)

DAOFIN emerges as a pioneering governance model within the XDC ecosystem. This innovative approach draws inspiration from modern constitutional governments, employing a sophisticated system of checks and balances to mitigate the risk of manipulation. By effectively dividing governance power, DAOFIN ensures that large stakeholders receive a fair share of influence while maintaining a process that is thoughtful, diligent, and rules-based, thanks to the contributions of a deliberative body ultimately accountable to the community. This model not only champions transparency and equity but also facilitates broad-based participation in decision-making, reflecting the democratic ethos at the heart of XDC community.

At the core of DAOFIN's governance are three distinct communities, each with a unique role in the ecosystem's harmony and functionality. Remarkably, each community is characterized by the exclusivity of membership, meaning an individual's address can only belong to one community, eliminating any overlap and ensuring clear demarcation of roles and responsibilities. This structure supports a diverse array of parties to engage in the governance process, enriching the ecosystem with a wide range of perspectives and expertise.

Master Node Delegatee Senate: This first community comprises operators of Master Nodes, the linchpins in achieving consensus and guaranteeing the network's operational efficiency. These nodes employ a special wallet address known as a delegatee to represent them in all interactions with DAOFIN. This mechanism enhances security and ensures that each Master Node's influence is accurately represented, with the flexibility for Master Nodes to change their delegatee under certain conditions. Here, democracy prevails, as each Master Node wields a single vote, emphasizing the importance of each node in the collective decision-making process.

Judiciaries: The second pillar of DAOFIN's governance model is the Judiciaries, a group of seasoned experts and leaders from various sectors. Their primary role is to ensure that proposals align with DAOFIN's overarching goals and criteria, serving as the guardians of the ecosystem's integrity. Initially handpicked by the founders to avoid conflicts of interest, this committee represents the community's diverse interests. As DAOFIN progresses towards greater decentralization, the Judiciaries will be democratically elected by the Senate and the People’s House through annual elections, employing a quadratic voting system to select members, thereby ensuring that each member's voice is equitably represented.

People’s House: The final community within DAOFIN's governance model is the People’s House, an inclusive platform that welcomes any XDC token holder who meets a minimum threshold. This community epitomizes the ethos of inclusivity, enabling a broad spectrum of participants to engage in governance through proposal voting. The People’s House empowers its members by granting voting power proportional to their token holdings, adhering to the principle of "one token, one vote." This approach not only democratizes the governance process but also encourages active participation from the wider community, ensuring that a multitude of voices can contribute to shaping the future of DAOFIN.

Together, these three communities form the backbone of DAOFIN's unique governance model, each playing a crucial role in fostering a robust, transparent, and inclusive ecosystem within the XDC network. By balancing the interests of different stakeholders and ensuring a wide range of input in decision-making, DAOFIN sets a new standard for democratic governance in the Blockchain space, promising a more equitable and sustainable future for decentralized finance.

Governance decisions are made through a structured voting process across various communities. Two crucial metrics in this process are the Quorum and the Passrate. They are vital for ensuring decisions are representative and receive broad support. Each proposal discusses these concepts and their application within each community in DAOFIN, aiming to clarify the vote finalization process.

Quorum: Defined as the minimum proportion of eligible votes that must be cast in a voting session to deem it valid. It guarantees that decisions reflect adequate community participation.(simply saying that counting all the votes including all YES, NO, ABSTAIN votes)

Passrate: Indicates the percentage of affirmative votes required for a proposal to be approved, ensuring substantial support for implementation.(counting all YES votes)

In the next article we’ll delve into exploring Proposal Types, associated voting periods to each proposal and DAO Treasury.

DAOFIN Beta Version(Apothem)

Article Series:

Part 1

Part 2