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Governance overview

The Lisk project is governed by the Lisk DAO and Onchain Foundation. The Onchain Foundation defines the vision and strategy for the project together with the Lisk team, funds its development and is a stakeholder in the Lisk DAO via the Lisk Team delegate. The Lisk DAO allows any LSK token holder that stakes their tokens to participate in onchain governance for the Lisk project. The Lisk DAO decides how to spend funds in its significant treasury and can pass general proposals about protocol parameters or the project direction.

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Every LSK token holder who participates in the DAO is rewarded with staking rewards, to incentivize participation in the Lisk governance.

Lisk Admin Addresses​

Details of Admin account addresses on 🟢 Ethereum Mainnet and 🟡 Sepolia Testnet are as follows.

note

The Gelato-controlled accounts will be transferred to the OP security council in the near future.

Admin RoleControlled/Owned byAddress
L1 Proxy AdminGelato0xeC432c4F1d0E12737f3a42a459B84848Af979b2d🟢
0x5Db9F05921d8d5a6a157F6f49c411cc0e46c6330🟡
SystemConfigGelato0x05f23282FFDCA8286E4738C1aF79079f3d843750🟢
0xF54791059df4a12BA461b881B4080Ae81a1d0AC0🟡
BatcherGelato0xa6Ea2f3299b63c53143c993d2d5E60A69Cd6Fe24🟢
0x246E119a5BcC2875161b23E4e602e25cEcE96E37🟡
ProposerGelato0x0AbD6da1cE10D1cD6c7C9C14b905786D20f3EB23🟢
0xBbD3a1D90B0Ef416581ACdC6a72046b38D3af9AD🟡

Lisk Security Council​

The Lisk security council is a 3-of-5 multi-signature wallet with key members of Lisk team and Onchain Foundation.

The purpose of the security council is to be responsible for smart contract upgrades in case a security vulnerability is discovered.

The security council controls the following contracts:

  • Claims contract
  • Governance contracts
  • Staking and Rewards contracts
  • All Vesting contracts
  • Airdrop contract

The ERC-20 token contract cannot be upgraded by the security council, but the security council has the special power to add accounts that can burn LSK tokens. This is only planned to be used in case the community decides to burn the 100M LSK allocated to the Lisk DAO.

Lisk DAO​

The Lisk DAO provides the opportunity for LSK token holders to participate in the overall governance of the Lisk project, including allocation of funds, protocol updates, or strategic directions. Decisions are made via proposals.

Tools​

The following are the main tools to participate in the Lisk DAO:

Tally is the platform used to create and vote for proposals of the Lisk DAO.

The Lisk DAO Tally instance is the place where users can vote on proposals or delegate their voting power.

Treasury​

The Lisk DAO has an associated treasury, which resides in the Timelock contract. The current balance of the treasury can be checked on the Lisk BlockScout Explorer.

The treasury is NOT managed by the Onchain Foundation. Instead, the funds from the treasury can only be transferred via successful funding proposals.

Tokens for the Lisk DAO fund are minted. They are added to the treasury according to the following vesting plan:

YearAmount (LSK)Description
202415,000,0006,250,000 LSK liquid at migration, 8,750,000 LSK are linearly released in 2024, starting from the migration.
202515,000,000LSK are linearly released over the year.
202615,000,000LSK are linearly released over the year.
note

The DAO fund may be increased further in the future by an additional 100,000,000 LSK over the following 7 years (2027-2033) if the DAO members approve the corresponding proposals.

Voting power​

Every account holding LSK is able to stake/lock a specific amount of LSK tokens to get some voting power and staking rewards.

This works as follows:

  • Stake tokens for a specific locking duration (between 2 weeks and 2 years) on the Lisk Portal.
  • Receive voting power and staking rewards proportional to the amount of locked tokens.
  • Delegate the voting power on Tally to yourself or another delegate in order to use it.
  • After the locking duration ends, the users can unlock their staked tokens.

Voting power calculation​

Locked tokens provide a voting power proportional to the amount of locked tokens. Concretely, 1 locked LSK provides one unit of voting power (= 1 vpLSK).

Boosting the voting power​

Users have the option to pause the countdown of the locking period. This means that the counting towards the end of the locking period is paused until the user decides to resume it. In the case of pausing, the user receives a boost of the voting power. It is set to lockedAmount * (1 + remainingLockingDurationInDays/365). Hence, the voting power can be increased by up to 200%, which is achieved at the maximum locking duration of 2 years

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The voting power for each proposal is counted from a snapshot on the creation of the proposal. Therefore, pausing the locking duration after a proposal is created does not increase the voting power for this proposal, but for the future ones.

Delegation​

The Governor framework requires delegating the voting power in order to use it. The voting power can be delegated to other users or to yourself. Self-delegation is a requirement if you want to vote on your own.

Delegation happens on Tally.

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Please go to the Delegation page to find out more about the delegation process, including guides how to delegate and how to become a delegate.

Proposals​

Proposals are created on Tally. For spam protection, the following requirement must be fulfilled in order to create a proposal:

  • Proposal threshold: For creating a proposal, the voting power of the proposer must be at least 300,000 vpLSK, i.e., the value corresponding to 100,000 LSK locked for 2 years where the countdown is paused.

Proposal types​

TypeDescriptionBinding?
FundingA proposal for receiving a certain amount of funds to an address. If approved, the recipient receives the amount given in the proposal.Yes
GeneralGeneral proposals about protocol parameters or the project direction in general that may be followed by the Onchain Foundation or not, depending also on feasibility and cost.No

Proposal evaluation​

The following requirements must be fulfilled for a proposal to approve:

  • Quorum: For a proposal to pass, the “yes” and “abstain” votes must sum up at least to 24,000,000 vpLSK, i.e., the value that corresponds to 8,000,000 LSK locked for 2 years where the countdown is paused.
  • There must be strictly more “yes” than “no” votes.

Implementation of funding proposals​

The transfer from the Lisk DAO treasury can be executed by anyone, once a funding proposal is approved. Funding proposals are binding, which means that no one, not even the Onchain Foundation, can prevent the transfer if the proposal passes.

Implementation of general proposals​

For approved general proposals, the Onchain Foundation will determine whether the proposal is safe, secure, consistent with the scope of Lisk governance, and capable of being implemented in a legally compliant manner. If it is, the Foundation will act diligently and in a commercially reasonable manner to cause the proposal to be implemented.

Administrative role of the Onchain Foundation​

The foundation will have an administrative role and will take care of the following:

  1. Removal of draft proposals that reasonably appear to be fraudulent, spam-oriented, defamatory, hateful, or otherwise inappropriate.
  2. Management of mutually contradictory proposals that are submitted simultaneously or in close proximity to one another.
  3. Administration of network maintenance, such as emergency bug fixes or release rollbacks (with or without a governance vote).