Crypto Trading: What are governance tokens?

By LeftFooted | bitcoinea | 5 Dec 2023


Governance tokens distribute power to token holders across a certain blockchain, or for a certain project, giving each token holder the ability to vote on decisions regarding said project or blockchain.


The amount of tokens you hold may or may not give you more or less power, but this is not always guaranteed.


It is often the case, but not always.


Most crypto projects rely on a DAO (Decentralised Autonomous Organisation) in order to decentralise power and take it away from the hands of one entity or one group of people.


Governance tokens are like voting chips.


I should point out that some tokens have more than use cases. So they aren't just for governance.


But a good example of governance I experienced recently is connected to SWEAT, the native token for the Sweatcoin pay-for-walk app.


SWEAT token holders were given the chance to vote on what to do next regarding the SWEAT token burning process.


 

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LeftFooted
LeftFooted

I’m a left-footed duck that loves writing. I write about cars, watches, craft beer and, you’ve guessed it, crypto Also active on read.cash


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