We are excited to announce the decentralization and security-focused onchain governance design of Taiko DAO. This milestone represents an important step forward in Taiko’s governance roadmap towards fully decentralized protocol governance.
TLDR:
- An optimistic governance model, where token holders have veto rights over the chain;
- The Security Council, which can propose improvements to the protocol efficiently and safely;
- Multi-threshold Protocol upgrades, with standard and emergency proposal paths;
- coded emergency proposals;
- Token holders can delegate their veto power;
- Unified governance process in Tyco Governance Center.
Taiko It is a zkEVM-based backlog equivalent to Ethereum, which is open and permissionless and does not require any additional trust assumptions, as security is derived from Ethereum’s validators. Vitalik proposed the first block on the Taiko Mainnet and he supported it because of the progress it made in decentralizing L2s.
Taiko is deeply committed to Ethereum’s core values, such as decentralization, permissionless, and trustworthiness. This applies not only to their unique technical architecture, but also to their commitment to giving the community onchain rights in the protocol upgrade process.
Optimistic governance
Taiko uses optimistic governance that enables streamlined decision-making that balances efficiency with community checks and balances. This design allows the Security Council to pass proposals, while giving token holders veto rights. This means that token holders can veto any malicious proposal and/or have the opportunity to exit. If the proposal does not collect enough votes by the end of the veto period, it will be automatically implemented after an additional 7-day time period. Giving token holders veto rights and the opportunity to exit serves as checks and balances and an additional layer of security. It also combats voter fatigue, as voters only need to participate when a veto is needed.
Multithreshold Multisig
Additionally, Taiko is incorporating multi-threshold protocol upgrades Inspired by polygon. This gives the Security Council two paths to implement protocol upgrades:
Standard proposal
The standard proposal flow is the typical path for most promotions and ensures the Taiko community is able to directly participate in the on-chain governance process. The process includes:
- An 8-member Security Council (to be announced later) consisting of internal and external members who develop and approve proposals.
- 3 out of 8 approvals from the Security Council are required to pass the standard proposal.
- A community review period where token holders and delegates have the ability to veto proposals.
- Any proposal that does not meet the veto threshold by the end of the review period is automatically implemented after a 7-day time period, giving token holders the opportunity to exit if necessary.
The vast majority of contingencies are with encrypted proposals
When a critical situation arises (for example, a major vulnerability in the protocol), the Security Council conducts an emergency process to expedite proposals to protect the Tycho Protocol and the community. Here’s how it works:
- As in the standard flow of motions, any Security Council member can submit an emergency motion.
- The contents of the emergency proposal are encrypted to prevent exploitation before execution.
- The approval threshold is higher for emergency proposals, as approval requires a supermajority of 6 of the 8 council members.
- There is no review or veto power for token holders during the emergency proposal process, as proposals are encrypted for security reasons.
- Finally, the contents of the proposal will be decrypted and made available to the public to maintain accountability and transparency in its implementation.
Tyco Governance Center
The Taiko Security Board and the community can participate in the governance process of the Taiko Governance Hub. For the Security Council, standard proposals and emergency proposals can be submitted through the Governance Center. Token holders can either delegate their veto power or veto power directly at the center as well. The Governance Center is designed specifically for the Taiko community and will evolve with Taiko Governance.
Taiko DAO is broadcast on the Hekla testnet for rigorous testing. With a truly binding on-chain governance system, voters will be able to directly influence the development of Taiko’s infrastructure. We welcome comments before mainnet publication. The best way to participate in the discussion is to join Taiko Discord server.
Taiko DAO is designed to meet L2Beat Phase 1 Standards Upon launch on the mainnet. Aragon’s governance solutions are ideal for L2s looking to become more decentralized, while balancing security considerations, and meeting industry best practices.
Whatever solution your DAO requires, building with Aragon OSx means your management systems can continue to evolve without compromising security or reliability. To learn more about how we can help, contact us.