Governance Token Regulates Voting Power in DAO
Have you heard of DAO? It stands for Decentralized Autonomous Organization.
Imagine a digital organization where all important decisions are made collectively by its members, not by a single big boss. So, how can members participate in determining the direction of this organization? The answer lies in the "governance token."
A governance token is a special digital asset designed for one purpose: to give you voting rights in the DAO. This is different from regular digital money like Bitcoin or Ethereum. Its function is similar to shares in a company, but in a decentralized world.
So, what determines how much your vote counts? It's very simple: the number of governance tokens you own. The more of these tokens in your digital wallet, the greater your voting weight during voting.
This means that it's not about how long you've been a member, or how many friends you have on social media that will determine your voting power. In fact, the amount of other cryptocurrencies you own does not directly influence it. The main focus is on the ownership of the DAO's governance tokens themselves.
This system ensures that the people who are most "invested" and have a stake in the success of the DAO will have the greatest say in determining its future. So, if you want to have an influence in the DAO, collect its governance tokens!