# Governance (DAO)

Governance is the democratized process through which proposals for any changes in Nebula Protocol are introduced and accepted by the community through voting. There are no admin keys with privileged access. After the initial bootstrapping of contracts, the Gov contract is set to be the owner of the Nebula Protocol contracts and all changes must be made through the governance with the procedure defined in this section.

# Nebula Token

The Nebula Token (NEB) serves as Nebula Protocol's governance token. Only users with a staked NEB position can vote on polls, and each user receives voting power weighted by their amount of staked NEB. For every poll, a user can choose to allocate up to their total staked NEB. Users with higher NEB stake will therefore have more influence when deciding in governance polls.

Although a user receives 1 vote per staked NEB for every poll, voting in polls does not have any effect on the user's current staking balance.

# Polls

New governance proposals in Nebula are called polls. Any user can create a poll by paying an initial deposit of NEB tokens. If the poll fails to pass the minimum voting quorum, the NEB deposit is given to NEB stakers and distributed proportionately according to their relative stake.

Polls consist of a text description of the proposition (with perhaps an external link to further resources / discussions), and include an executable message encoding the instructions to be run if it passes. The message will be executed with the privileges of the Nebula Gov contract, which has the power to invoke any function defined by the other Nebula smart contracts.

Once submitted, a poll can be voted on by the community until its voting period has concluded. If the poll passes quorum and threshold conditions (defined below), it is ratified and its contents can automatically be applied after a set period of time. These changes take effect without requiring updates to the core Nebula Protocol contracts.

note

Staked NEB tokens utilized in on-going polls cannot be withdrawn until the poll completes. In addition, the number of NEB used in a proposal cannot be modified after the vote has been submitted.

# Procedure

The following steps outline the governance procedure:

  1. A new poll is created with an initial deposit that meets proposal_deposit.
  2. The poll enters the voting phase, where it can voted for by anybody with a staked NEB position. Users can vote yes, no or abstain and can assign how many of their staked NEB to use for voting.
  3. The voting period ends after voting_period blocks have passed.
  4. The poll's votes are tallied and passes if both quorum (minimum participation of all staked NEB) and threshold (minimum ratio of yes to no votes) are met.
  5. If the poll passes, its contents will be executed after effective_delay blocks have ended. The poll must be executed prior to expiration_period, otherwise it will automatically expire and no longer be considered valid.
  6. If the poll passes, the deposit_amount will be returned to the poll creator. Otherwise, it will be kept within the governance contract and split evenly between all current NEB stakers.
Updated on: 4/28/2022, 7:21:28 AM