As we enter a decentralized world, how important is it to have a voice in decision making?
Not one day goes by where we do not have to make a decision. In real life we can control or influence circumstances through the decisions we make, we define our future in a certain way when we decide to: study, move, work, watch tv, travel, celebrate, etc. Its the same in the cryptocurrency market as different protocols are being built and offering users the opportunity to participate in their decision making through decentralized governance.
At an early stage, users may think that they don’t need to take part in governance because most of them are not used to it or don’t understand it, but the fact is that decision making is and has always been a key component for every successful business around the world. So, in a decentralized world, users have the opportunity or the responsibility to participate in governance, given the fact that whoever controls the governance power will have more decision making weight at the time of implementing rules in the future.
How can users participate in decision making?
The short answer is, by buying governance tokens. Cryptocurrency protocols often share with token holders the opportunity to suggest or participate in decisions related to the protocol. Governance token holders are usually more invested in the project’s success as they stand to gain or lose more, depending on the outcome.
What are governance tokens?
How can users benefit from it?
Generally, users vote by using decentralized voting systems. Community members can use governance tokens to influence the direction and features of a protocol directly. As such, it is possible to implement changes related to the platform, user interface, vote on fees, reward distribution, or even modify the underlying code of a project. Some governance tokens only vote on a limited number of governance issues. Similarly, some governance tokens have the option of generating financial returns, others do not. Each project has its own set of governance token rules. They are dispersed to stakeholders, including the founding team, investors and users, using various calculation methods.
MGP is the governance and revenue sharing token of Magpie. Users can lock their MGP as Vote-Locked MGP to earn passive income and get governance benefits. vlMGP holders can participate in Wombat’s governance cost-effectively while earning high APR % at the same time.
vlMGP governance rights, including but not limited to:
- Access Wombat Exchange voting.
- Vote to allocate WOM emission across different Wombat Pools.
- Vote to allocate MGP emission across different Magpie Pools.
- Feature development.
- Which protocols to integrate.