Ensuring that governance decisions reflect the will of the community requires well-defined quorums and voting thresholds. These parameters determine how many participants must be involved and what level of support is needed for a proposal to pass. Let’s explore quorum requirements, voting thresholds, and execution mechanics, along with their impact on governance effectiveness.

Quorum Requirements

What is a Quorum?

A quorum is the minimum level of participation required for a vote to be considered valid. Without a quorum, a small group of voters could pass proposals without broader community involvement.

Types of Quorums in DAOs

  • Absolute Quorum – A fixed minimum number of votes (e.g., 1,000 votes needed regardless of total voter participation).
  • Relative Quorum – A percentage of total token supply or governance power (e.g., 10% of circulating tokens must participate).
  • Dynamic Quorum – Adjusts based on factors like voter turnout or proposal type, reducing quorum requirements when participation is low.

Balancing Quorum Levels

  • Too High → Low participation may lead to governance stagnation.
  • Too Low → Small voter groups could manipulate decisions.
  • Solution → Dynamic or tiered quorum models ensure participation while maintaining security.

Voting Thresholds

What is a Voting Threshold?

A voting threshold is the percentage of votes required for a proposal to pass. It prevents minority rule and ensures decisions reflect majority support.

Common Voting Threshold Models

  • Simple Majority (50%+1) – The most common method, where a proposal passes if it gets more than half of the votes.
  • Supermajority (e.g., 60%-75%) – Used for high-impact proposals (e.g., protocol upgrades, treasury spending).
  • Relative Majority – The option with the highest votes wins, even if it’s below 50% (common in multi-choice voting).
  • Quadratic or Weighted Voting – Adjusts voting power based on participation to prevent dominance by large stakeholders.

Choosing the Right Threshold

  • Lower thresholds (e.g., 50%) encourage participation but risk controversial decisions passing too easily.
  • Higher thresholds (e.g., 66%) ensure consensus but can cause governance gridlock.
  • Tiered models allow different thresholds for different proposal types (e.g., lower for community initiatives, higher for constitutional changes).

Proposal Execution Mechanics

Once a proposal passes, it must be executed efficiently and securely. Execution can be:

Manual Execution (Off-Chain)

  • A trusted party (e.g., a multisig wallet or governance council) executes the approved changes.
  • Risks: Requires trust in executors; potential for delays or censorship.

Automated Execution (On-Chain)

  • Smart contracts execute the proposal once conditions are met.
  • Example: A passed proposal automatically triggers a treasury transfer.
  • Benefits: Reduces reliance on human intervention; improves transparency.

Hybrid Execution

  • A mix of on-chain and off-chain execution, where some decisions (e.g., funding approvals) occur on-chain while others (e.g., legal compliance) require off-chain action.

Final Thoughts

  • Well-designed quorums prevent governance manipulation while encouraging participation.
  • Appropriate voting thresholds balance efficiency with decision legitimacy.
  • Execution mechanics determine how smoothly governance decisions are implemented.

Setting flexible, well-calibrated governance parameters ensures that DAOs remain efficient, resilient, and community-driven.