9. DAO and Governance

The implementation of a governance system via a DAO is a widespread practice among projects now. In the spirit of decentralization, the power is spread among the entire community and not amongst whales or a small group of individuals. Proposals are presented and decided upon through this governance system.

For $LSD, governance rights and voting power are distributed based on $veLSD holdings. To obtain $veLSD, you must first stake and lock $LSD. The implementation of $veLSD not only gives an APR boost to staked ETH and $lsETH but also prevents someone from buying a very large amount of $LSD, voting on a proposal in their favor and then dumping their $LSD supply after. It is an extra safety precaution for proposals and decreases sell pressure of the native $LSD.

Proposals must be inclusive of the project’s overall goals, universal in its representation of the overall community’s decision and revokable. Revokable meaning that a proposal is allowed to be voted on again later or immediately to revoke the decision if the community decides. We must allow proposals and decisions to be adaptable to the community as we evolve.