Governance Tokens — Voting Power on the Blockchain
Governance tokens give you a say: vote on protocol upgrades, treasury spending, fee structures or new features. Sounds democratic — it is, with one big catch: more tokens means more votes. That's not democracy, that's plutocracy.
DAOs in Reality
Most DAOs have single-digit voter turnout. Large holders dominate votes, small investors rarely participate. Some protocols (Uniswap, Aave, MakerDAO) still have functioning governance — often because a few engaged delegates do the work.
What Governance Tokens Are Worth
A governance token without cash flow is essentially a ballot. Some protocols distribute fees to token holders (revenue sharing), others don't. This difference is critical for long-term valuation. Ask yourself: what do I get besides voting rights? If the answer is "nothing," think carefully about whether the current price justifies that.
