# Concepts

The governance process is divided in a few steps that are outlined
below:

* **Propose:** a proposal is submitted to the blockchain.
* **Vote:** governance token holdens can vote on the proposal.
* **Exec:** if the proposal passes within the time limit then the
  proposal is executed.

> Note: There is a special case where a proposal can be executed before
> voting period passes, if its strongly supported, based on the
> configured early execution quorum.

## Propose

To prevent spam, proposals must be submitted by holders with a certain
number of governance tokens and the DAO proposers key. Several members
of the DAO can add inputs separately to a proposal before it is posted
on chain so that their combined inputs meet the proposal governance
token limit.

Once proposals are posted on chain, they are immediately active.

### Proposal States

* *Active*: the proposal is open to voting.
* *Expired*: the proposal passed its duration and can no longer be
  voted on.
* *Accepted*: the proposal gained sufficient votes but is not yet
  executed.
* *Executed*: the proposal was accepted and has been confirmed on
  chain.

## Vote

### Participants

*Participants* are users that have the right to vote on proposals.
Participants are holders of governance tokens specified in the DAO.

Note that only participants from before the proposal is submitted on
chain are eligible to vote. That means receivers of governance tokens
after a proposal is submitted will *not* be eligible to vote.

There are currently two voting options:

* Yes
* No

### Voting Period

Once a proposal passes its duration, which is measured in 4 hour block
windows, participants can no longer vote on the proposal, and it is
considered *expired*.

### Quorum

Quorum is defined as the minimal threshold of participating total
governance tokens needed for a proposal to pass. Normally this is
implemented as min % of voting power, but we do this in absolute value.

### Early Execution Quorum
Early execution quorum is defined as the minimal threshold of
participating total tokens needed for a proposal to be considered
strongly supported, enabling early execution. Must be greater than or
equal to normal quorum.

### Approval Ratio

The approval ratio is defined as the minimum proportion of yes votes
for the proposal to be accepted.
