Ink Finance Guide v2
  • Welcome to Ink Finance
  • Getting Started
    • Network and Wallet
      • For Testnet Users
      • Wallet and Assets
    • Role Selection
      • DAO Manager
      • DAO Member
    • Navigating INK Webapp
      • The DAO List
      • The DAO Dashboard
  • DAO Creation
    • Governance Token vs. Badge
    • Create a New DAO
      • DAOs with Governance Token
        • Set up New Staking Engine
      • DAOs without Governance Token
  • For Managers
    • At the Board-level
      • Configure Committees
        • Treasury Committee
          • Treasury Setup
          • Auditable Incomes
          • Change Treasury Manager
        • Community Committee
          • Community Management Setup
          • Social Resources Setup
          • Change Community Manager
          • Remove Community Board
        • Investment Committee
          • Investment Management Setup
          • Change Investment Manager
          • Remove Investment Committee
        • Funding Committee
          • Funding Management Setup
          • Change Funding Manager
          • Remove Funding Committees
      • Make Proposals
        • Off-chain Proposals
        • Change Governance Rules
        • Merger & Acquisition
  • At Committee-level
    • Treasury Operations
      • Payroll Setup
      • One-time Payment
      • Direct Transfer
      • Sign Payment
      • Audit Incomes
    • Community Operations
      • Set up Airdrop
      • Sign Airdrop
      • Poll & Survey
    • Investment Operations
      • Administration
        • Set up Fund
        • Launch & Start Fund
        • Dissolve Fund
        • Allocate Fees
      • Trading
        • Introduce Assets
        • Initiate Trade
        • Distribute Dividends
        • Deposit Income
      • Approving
        • Approve Assets
        • Approve Trade
      • Liquidate Fund
      • Audit
    • Funding Operations
      • Set up Funding Product
      • Launch & Start
      • Manage Product
      • Distribute
      • Dissolve
  • For All Members
    • All Proposals
      • Open for Vote
        • Cast Votes
        • Tally Votes
      • Resolutions
        • Execute Off-chain Resolutions
        • Execute On-chain Resolutions
      • Failed Proposals
    • DAO Activities
      • Governance Rules
      • Treasury Activities
        • Treasury Balance
          • Deposit to Treasury
        • Payment History
        • Income History
        • Audit Reports
      • Community Activities
        • Airdrop History
        • Polls & Surveys
      • Investment Activities
        • Open for Investment
        • Funds in Operation
        • Matured Funds
        • Failed Launch
      • Funding Activities
    • Member Activities
      • Collect Pay
      • Staking & Pledging
      • Management Record
      • Voting Record
      • Your Investments
      • Verify Identity
  • The White Paper
    • 🔎Ink Finance White Paper
  • More Readings
    • The INK Modules
    • Unified Custodian Vault
    • InkEnvelope
    • QUILL Utilities
    • QUILL Allocation
    • Ink Economy Rules
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  1. DAO Creation

Governance Token vs. Badge

Ink Finance's allows DAOs to balances the power between financial stakeholders (DAO token holders) and community contributors (Badge holders). Read this chapter before moving on to DAO creation.

PreviousThe DAO DashboardNextCreate a New DAO

Last updated 2 years ago

A DAO can have two governance models:

1)With governance token

In this "stake-to-govern" model, everyone in a DAO must "have skin in the game" when they participate in governance - manage or vote. This model also raises the barrier against Sybil attack. In such a use case, the DAO creator must provide the DAO's native token as a governance tool.

However, Ink Finance also provides effective means of resisting whale attack. A sub DAO of a large ecosystem can set up its own Badge, and require that only holders of this badge can vote on its affairs. Such badges are usually earned or assigned, instead of bought.

When both a governance token and a badge are used as governance tools, the effective power in voting can be set by the DAO as a combination of the two. In the simplest scenario, a voter must hold at least one badge to enter voting, then the votes will be counted based on the user's staked governance tokens.

2)Without governance token

When there is no governance toke, meaning no stake-to-vote, then only Badge is used as governance tool, and the votes will be counted based on the number of badges in user's wallet.

3) Convert contribution value to Badges

Badges allow DAOs to put community value ahead of pure economic power. For DAOs that emphasize NFT or other content creation, the Badge serves as a converter of various User Generated Contents (UGC) to a uniformed measurement in governance. How to convert any kind of contribution into badge numbers can be flexibly determined by the DAO and its members. But once the conversion is done, everyone can agree on the uniformity.

After the badge holders enter the voting, the effectiveness of voting can be measured by either the combination of the pledged governance token and the badge numbers, or just the badge numbers. The specific relationship between the two is customizable.

Note:

If a DAO is created with Badge, the creator needs to distribute the badges to the community members before they can vote in this DAO. Badges represent the contribution profile of a member, and therefore should not be transferrable, once they are assigned to members.

Example: 'COOL' DAO's badge is COOL, governance token is QUILL