Governance Overview

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Governance Overview
Why Governance is critical to blockchain ecosystems
Public blockchains face large challenges such as stakeholder alignment, funding, and upgradability due to their decentralized and open-source nature. The informal off-chain governance systems of traditional open-source software is ill-suited to deal with these challenges. This is because of the large economic stakes that are involved, the coordination problems of maintaining a decentralized network, and the funding necessary to incentivize growth of these platforms.


SX Network utilizes a transparent governance system so that SX token stakers can directly control network parameters and the on-chain community treasury. This governance system serves to align incentives of different stakeholders within the network by imbuing control over the network directly into SX. The governance system coordinates stakeholders with its decisive and objective voting system. The governance system settles disputes and dispels doubt over the future direction of the network by providing clear and actionable parameters by which network changes happen.
There are a number of public goods that can also be funded out of the SX Network community treasury that will deliver an economic return to SX Network that far outweighs their cost. For example, the SX Network community treasury can fund massive public awareness programs for relatively small amounts of funding. On the technology side, it can fund innovators looking to improve on the SX Network architecture or invest financial resources directly into applications looking to deploy on the network.
The vast majority of treasuries (BlockOne) or foundations (Ethereum Foundation) associated with most public blockchains are opaque and run by centralized entities; the on-chain SX community treasury is completely transparent and controlled directly by SX holders. It is a massive competitive advantage that will further elevate SX Network.
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