Theca DAO: how it works, characteristics and voting system

What is a DAO?

A DAO is a governance model often used for DApps, projects and crypto investment funds. DAO stands for Decentralized Autonomous Organization, automated via code and open to anyone (as long as some basic requirements are met). Decentralized in nature and based on the automatic execution of smart contracts, the DAO has become very popular in the blockchain space. As autonomous, a DAO is created and managed by a community, which collectively manages its funds and projects. Activity and executive power are obtained and managed through codified rules using smart contracts. Both DAO financial transactions and the program rules are stored in a blockchain-type database.

Theca DAO

Theca DAO has the purpose to provide a digital and secure ledger, which keeps track of financial interactions, fights against forgery by using a trusted "timestamp" and stores all information in a decentralized way. Transparency, traceability and democracy are the main features of Theca DAO.

As a decentralized organization, Theca DAO uses a set of rules and interoperable smart contracts that is maintained by the Theca DAO and is deployed on the Solana Blockchain.

Theca DAO is a community-run, community-governed decentralized autonomous organization. Changes are made through proposals and voted on both by the Council or by the holders of a minimun amount of THECA token, according to each specific proposal.
Theca facilitates financial interactions, uses a trusted "timestamp" and decentralizes all information and authors' works. In this community-led organization, any decisions are made through a governed vote including what, how, and when Theca DAO proposals are made.

Theca Council Members and the Proposals

In order to interact within the DAO and make changes, Theca DAO has a well-defined voting mechanism. Proposals are presented by Theca Council Members (maximum 9 members). If the proposal is supported by at least two other Council Members it will pass to the vote of the entire Council, or it will be voted by all the holders who have a minimum amount of THECA defined within the rules of the DAO program.

The actions that can be voted on will be:

  • Proposals for changes
  • Updates
  • Use of resources such as wallets and assets
  • Treasury revenue allocations and distribution
  • Protocol and app fees
  • Proposals for the operation of the Dapp Theca
  • New ways of voting
  • Owning THECA token

To demonstrate the right to vote in the Theca DAO, it is necessary to own THECA Token. Anyone who holds THECA token has a voting right proportional to the number of tokens they own. Theca Council Members can also propose changes to the functioning of the DAO itself, and vote for new voting mechanisms.

Theca DAO Voting System

The proposals can be voted in two different ways. They can be voted only by the board or by the theca holders with a minimum amount of theca. This is defined during the creation of the proposal. The governance mechanism is designed to be flexible and upgradeable over time. It is possible to vote Against or In-Favor of the published Theca Improvement Proposals (TIP). Some examples of Theca Improvement Proposals (TIP) voted on are:

  • Treasury revenue allocations and distribution
  • Protocol and app fees (entry, exit, repayment, deposits, etc.)
  • Price oracle changes (where pricing comes from)
  • Risk parameters (i.e. liquidity ratio, debt value)
  • Incentivized rewards for THECA tokens
  • Upgrades to the foundational protocols (like supporting a new blockchain, pool, protocol, community implementation partner, etc.)
  • New ways of voting
  • Operation of the Theca Dapp

Theca community and funds management

The key to creating a successful DAO is a good project and an active community. The more people join Theca Project and participate in the governance of the Theca DAO, the stronger the decentralization becomes. The authority is spread among multiple stakeholders, this means a new proposal cannot be censored and the votes cannot be technically manipulated. Theca DAO organizes the community and allows it to create an efficient organization with a technology that guarantees integrity and democracy. In fact, the management of theca funds is also based on the principle of democracy. Treasury is handled via a multi-signature (multisig) wallet, which can only be used if the majority of all key participants agree.

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