Governance Phases

Essence Finance is set to adopt a staggered approach to decentralization, ultimately aiming for complete autonomy and governance steered by the community through the Essence DAO. The timeline provided for each stage is an estimate; the true length may vary based on variables like the community’s size, engagement in voting, and the progress of development. In the first three stages, the transition to subsequent stages will hinge on the judgment of the multisig, particularly its evaluation of any potential safety issues.

Governance Phases

Phase	Governance Plan
Phase 1: Launch	Community members can suggest initiatives and vote on them. A multisig of Essence Finance team members will enact the vote results. Initially, the multisig will require 2 -of - 3 signers. Post-launch, the DAO may form new committees to enhance or maintain the ecosystem, with engineering, growth, and strategy committees expected to be proposed early on.
Phase 2: 1 month	Community participants are empowered to put forward proposals, which will be followed by votes to gauge community sentiment. The multisig will grow to incorporate signers from outside the Essence Finance team, increasing the number of signatories to a 3-of-5 configuration.
Phase 3: 3 months	Proposals and voting within the community will transition to being binding. However, the multisig will hold a veto right, especially on matters that may pose safety risks to users. At this phase, decisions regarding the protocol and products will become officially binding, whereas the multisig will continue to oversee treasury management and other critical safety matters.
Phase 4: 9 months	The shift towards binding community votes will progress, with protocol and product-related decisions taking precedence. The multisig’s veto authority will be phased out entirely. In this stage, community members will also gain the right to nominate and elect new multisig participants.
Phase 5: 15 months	Complete decentralization will be achieved, with the DAO being fully constituted and governed by the community, where all decisions are determined through community voting.

Phase

Governance Plan

Phase 1:

Launch

Community members can suggest initiatives and vote on them. A multisig of Essence Finance team members will enact the vote results. Initially, the multisig will require 2 -of - 3 signers.

Post-launch, the DAO may form new committees to enhance or maintain the ecosystem, with engineering, growth, and strategy committees expected to be proposed early on.

Phase 2:

1 month

Community participants are empowered to put forward proposals, which will be followed by votes to gauge community sentiment. The multisig will grow to incorporate signers from outside the Essence Finance team, increasing the number of signatories to a 3-of-5 configuration.

Phase 3:

3 months

Proposals and voting within the community will transition to being binding. However, the multisig will hold a veto right, especially on matters that may pose safety risks to users. At this phase, decisions regarding the protocol and products will become officially binding, whereas the multisig will continue to oversee treasury management and other critical safety matters.

Phase 4:

9 months

The shift towards binding community votes will progress, with protocol and product-related decisions taking precedence. The multisig’s veto authority will be phased out entirely. In this stage, community members will also gain the right to nominate and elect new multisig participants.

Phase 5:

15 months

Complete decentralization will be achieved, with the DAO being fully constituted and governed by the community, where all decisions are determined through community voting.

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Last updated 6 months ago