🏛️ Governance Process
Learn about the Factlink token and how it enables decentralized governance of the Factlink protocol on Solana.
The Factlink token (not yet launched) is primarily a governance token used to contribute to Factlink protocol decisions, such as voting on Factlink Improvement Proposals (FLIPs), data queries, and disputes escalated to Factlink's Data Verification Mechanism (Factum DVM).
Governing the Factlink Ecosystem
The Factlink token is an integral part of the Factlink ecosystem as it guarantees the economic security of Factlink smart contracts and its oracle system. The objective of the Factlink token is to enable the optimistic oracle to remain secure utilizing a fully decentralized and permissionless method.
Factlink's Factum DVM is designed with an economic guarantee around the cost it would take to corrupt the oracle and the profit someone would receive. The DVM ensures the price to obtain 51% of Factlink tokens is greater than the profit from corrupting the Factum DVM, as measured by the collateral stored in Factlink's smart contracts. This is achieved through an inflationary reward distributed pro-rata by stake to voters who participate and vote correctly. As long as there is an honest majority, voters will vote correctly.
As the total value of collateral locked in Factlink grows, the Factlink token is required to increase in value to ensure the security of the Factum DVM. To ensure this inequality holds, the Factum DVM charges fees to smart contracts interacting with the oracle, which the DVM would use to buy Factlink tokens or fund ecosystem initiatives as determined by governance.
Voting
The Factlink voting process for governance requires tokenholders to vote in the Realms Factlink DAO (soon to be launched) through the Factlink tokens.
- Factlink tokenholders can discuss their votes in dedicated channels of the Factlink Discord before voting.
- Factlink tokenholders will use a dedicated Voter dApp (launching soon) to vote on dispute resolutions and the Solana Governance UI via Realms DAO for broader protocol decisions.
Examples of governance proposals include:
- Approving new query types and whitelisted tokens for bonds and rewards.
- Data queries and disputes.
- Upgrading the core Factum DVM protocol and/or modifying DVM parameters.
- Registering and de-registering query templates or contract integrations.
- Shutting down contract instantiations (in rare circumstances).