Governance
The Scintilla Network introduces a governance model designed to foster community engagement, ensure network integrity, and facilitate sustainable development.
By incorporating elements of indirect, direct, and layered governance, Scintilla achieves a dynamic and flexible governance structure that empowers its community at every level.
This applies the same level of modularity than the protocol itself to ensure that the system and its users will always have ways to express themselves.
Indirect Governance: Validator Module Pinning
At the heart of Scintilla's indirect governance are the validators, who play a pivotal role in determining the network's operational modules by choosing which ones to support or "pin." This process allows validators to influence the network's direction and priorities indirectly by supporting modules that align with the community's needs and the network's long-term vision.
This also provides for regulators to express their own governance, as a validator in a specific country can unpin any modules that do not match the local legal framework, the module will only be validated elsewhere.
Direct Governance: Staker Voting Rights
Direct governance is manifested through the voting rights of SCT stakers. By participating in governance votes, stakers can directly approve or reject budget proposals, influencing how the network allocates its resources.
This mechanism ensures that those who are invested in the network's success have a say in its development and financial management.
Layered Governance: Multi-Level Decision Making
Scintilla's governance extends across multiple layers, reflecting the network's modular architecture:
- Blockchain Governance: Involves decisions that affect the core blockchain infrastructure, such as consensus protocol changes and network upgrades. Also provide one the budget system funding via newly created SCT.
- Metachain Governance: Each Layer 1 module, including smart contracts, identity, and banking modules, can have its governance system, allowing for module-specific decisions on development and fee structures.
- Layer 2 Systems and Tokens Governance: Layer 2 solutions built on Scintilla, as well as individual tokens, can implement their governance models, enabling granular control over their operations and fee models.
Budget Model
Inspired by the successful implementation in Dash, Scintilla's budget model is a cornerstone of its governance system. The model allows community members to request funding for projects that contribute to the network's growth and development.
Funding sources include:
- Emission Funds: A portion of newly minted SCT coins is allocated to the budget, ensuring a steady flow of resources for network initiatives.
- System Fees: Fees generated from network activities, such as bridge transactions, swaps, and other services, contribute to the budget, aligning financial incentives with network usage and growth.
This provides with a way for external entities (DAOs) to create a proposal and get funded for building additional tool for the network, PRs or fund services (in case of services - such financing could be done directly within Layer 2 via the emission of a company-linked RWA with governance and revenue sharing system).
Modular Governance: Flexibility and Scalability
Scintilla's governance model is inherently modular, mirroring the network's architectural design. This modularity allows for tailored governance mechanisms within different network components, ensuring that decision-making processes are optimized for each context. This approach not only enhances governance scalability but also allows for the integration of innovative governance practices as the network evolves.
Decentralised autonomous organisations
DAOs are a specific identity representing a consortium of identities (can be other Dao, account etc…). As such, within Scintilla they are the entities that can push new proposals, and have an associated programmability in the ways of the DAO internal governance system, and via the external reputation and profit distribution mechanism. As such, DAOs can also emit tokens and appoint trustees that have rights to perform transaction as-hod to the whole DAO members. Those trustees are appointed by DAO members. Scintilla Budget system requires DAO to have at least 2 signing reputable trustees to ensure payment.
Early Open Discussions
Since mid 2023, the specifications of the protocol are being open to community discussions and propositions. This allow every participant to be part of the network, and are therefore entitled to be recipients of the first emitted coins at genesis.
Conclusion
Governance in the Scintilla Network is designed to be inclusive, flexible, and scalable, reflecting the network's commitment to community-driven development and sustainable growth. By combining indirect, direct, and layered governance mechanisms with a robust budget model, Scintilla empowers its community to shape the network's future actively. As the network continues to evolve, so too will its governance model, adapting to new challenges and opportunities to ensure that Scintilla remains at the forefront of blockchain innovation. For more information on participating in Scintilla's governance processes, accessing budget proposal templates, or learning about specific governance mechanisms for each module, please refer to the subsequent sections of this documentation.