Governance Incentives

A critical aspect of fostering a democratic and balanced governance structure within the Kamikage ecosystem involves the equitable distribution of voting power among $KAGE token holders. To achieve this, we have devised a unique formula for calculating voting power that aims to minimize the disparity between large and small token holders.

Voting Power Formula

Voting Power Formula: Voting Power = sqrt(Number of $KAGE Tokens Held)

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Components Explained

1. Number of $KAGE Tokens Held:

   • This is the quantity of $KAGE tokens that an individual holds in their wallet.

   • In traditional systems, each token might represent one vote, but in our model, the relationship between tokens held and voting power is not linear.

2. Square Root Function (sqrt):

   • The square root function (sqrt) is used to calculate the voting power.

   • This mathematical function effectively reduces the weight of larger holdings in governance decisions, thereby leveling the playing field between smaller and larger investors.

Impact of the Formula

• Balanced Governance: By applying the square root function, a holder with, for example, 10000 tokens doesn’t have 10 times the voting power of someone with 1000 tokens, but rather just about 3.16 times more. This approach reduces the risk of governance being dominated by large holders.

• Encouraging Wider Participation: This formula incentivizes smaller holders to participate in governance, as their influence is proportionally greater than in a one-token-one-vote system.

• Preventing Plutocracy: It helps prevent the system from becoming a plutocracy, where the wealthiest members hold most of the decision-making power.

Operational Implementation

• Voting in DAO Proposals: When voting on proposals in the Kamikage DAO, each holder’s voting power will be calculated based on the square root of their $KAGE holdings.

• Smart Contract Enforcement: This formula will be encoded into a smart contract to ensure transparency and fairness in the voting process.

Goal

• The primary goal is to foster a more democratic and inclusive governance model within the Kamikage ecosystem.

• By empowering a broader base of the community, we aim to make governance decisions more representative and aligned with the diverse interests of all stakeholders.