Governance & DAOs
Proposal
Governance Proposal
Formal suggestion submitted to DAO community for voting on protocol changes
Definition
A governance proposal is a formal suggestion submitted to a DAO or protocol community for voting. Proposals can include parameter changes, protocol upgrades, treasury spending, or strategic decisions.
Example
A proposal to change Uniswap's trading fee from 0.3% to 0.25% would need to be voted on by UNI token holders before implementation.
What to check
Treat it as a governance concept: check who has voting power, what can be changed, and whether minority users can exit. The main checks are: Poor decision making; Low participation; Governance attacks.
Risks to Consider
- Poor decision making
- Low participation
- Governance attacks
Common Questions
What does Proposal mean in DeFi?
Proposal means Formal suggestion submitted to DAO community for voting on protocol changes. The useful question is not only the definition, but how the mechanism changes risk, return, liquidity, or governance for the user.
How is Proposal used in practice?
A practical example: A proposal to change Uniswap's trading fee from 0.3% to 0.25% would need to be voted on by UNI token holders before implementation.
What should I check before relying on Proposal?
Check poor decision making, low participation, governance attacks. Also verify liquidity, oracle assumptions, admin controls, and whether the protocol has been tested during stressed markets.
