Back to glossary

Governance token

Governance tokens are a type of cryptocurrency token that grants their holders the ability to engage in decision-making processes of a decentralized autonomous organization (DAO) or blockchain platform. By owning governance tokens, individuals have the privilege to vote on proposals pertaining to platform development, management and progression, such as protocol changes, policy updates, and resource allocation.

The voting power of holders is based on the number of governance tokens they possess. Proposals are subject to acceptance or rejection based on the outcomes of these votes, giving governance token holders a direct say in the direction and future of the platform.