WCT Series (7): Detailed Explanation of WCT Token Governance Function
The WCT token is not just the fuel of the network, but also a powerful tool for community governance. In the WalletConnect ecosystem, the governance mechanism is cleverly designed to allow holders to truly participate in decision-making, driving the network towards decentralization. Simply put, WCT holders can influence proposals through voting, from fee structures to token transferability, and even adjustments to incentive pools. This system emphasizes community-driven governance, avoiding control by a single entity and ensuring the long-term health of the network.
Specifically, the governance process is divided into three stages: proposal, discussion, and voting. Anyone holding enough WCT can initiate a proposal, such as whether to introduce messaging fees or to adjust the staking reward ratio (currently recommended to be between 0.25 and 0.66). Voting weight is based on the amount staked, but a cap is set (e.g., 1/10) to prevent large holders from monopolizing. Initially, tokens are non-transferable, which actually paves the way for governance, allowing everyone to focus on testing network functionality rather than short-term speculation. The foundation will assist the community, but the final decision-making power lies in the hands of the holders.
Taking a practical example, if the community wants to enable an inflation mechanism to support long-term incentives, holders can vote on this. This is not just about technology but also involves ecological balance—rewarding node operators and wallet providers while maintaining user privacy and resistance to censorship. The governance of WCT also extends to node state management, such as punishing bad behavior to ensure efficient operation of service nodes. In the long run, this mechanism will make the WCT network more resilient and adaptable to the rapid changes in Web3. Holding WCT is equivalent to holding the steering wheel of the future direction of the ecosystem.
