Defrost Finance
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βοΈ Mechanisms and Functions
Governance
Interim Governance Rules
In order to get Defrost Finance governance kicked off, interim governance rules are established.
Governance rules will be developed over time according to community proposals and votes, while the goal is 100% community-controlled governance. These rules have been set as temporary rules by the Defrost Finance team in order to get governance kicked off, they will evolve over time.
MELT as the governance token
As a governance token, MELT is used by its holders to vote on changes to parameters inside of the Defrost Finance Protocol, like Stability Fees, the H2O Savings Rate, liquidity mining incentives, Minimum Collateral Ratio and many others. Voting is also used to make decisions on the non-technical aspects of the protocol like acceptable LP lists for minting H2O, governance processes, and even electing individuals to fill specific roles.
The Defrost Voting system will be deployed soon, with sMELT (as staked MELT) representing users voting power. More protocols holding MELT (like MELT in the liquidity pools) can be added later as the governance goes.
Process
Governance will take place primarily through the official discussion forum and through Snapshot.
The governance process begins at the Defrost Finance Governance Forum where proposals are first submitted for discussion. If the community signals its interest and any necessary modifications to the proposal are made, the proposal is submitted to Snapshot for voting. For emergency proposals that need to be processed immediately, the team may submit proposals to Snapshot for voting directly.
During the interim governance period, only Core proposals are binding. Core proposals are those made by addresses whitelisted by the Defrost Finance team.
If a Snapshot proposal passes and no code is required to be implemented, the approved action will be taken directly by the team. If code deployment is required, the code will go to audit if necessary, and there will be a period for public review of at least one week before the code is deployed.
Criteria for a Valid, Binding Vote
- 1.Proposals will only be considered valid if at least 5% of staked MELT participates in the vote.
- 2.Votes will be scored as 1 MELT = 1 VOTE. This includes MELT staked in the Defrost Finance whitelisted protocols. 1 SMELT will have the equivalent voting power of the underlying MELT.
- 3.A simple majority is required for a winning vote.
- 4.The voting period must be at least 2 full days and is recommended to be no longer than 7 days.
- 5.Proposals must be in English. Any other translation is welcome.