Skip to main content

Governance (DAO)

Introduction​

Governance on XFI Console is a comprehensive decentralized governance system that allows any community member to influence strategic and operational decisions within the CrossFi ecosystem. Based on MPX (Mint Power) tokens, the Governance module ensures transparency, efficiency, and democracy in decision-making processes through smart contracts.

Key Features

CrossFi Governance is powered by MPX tokens and enables community-driven decision making through transparent, on-chain voting mechanisms.

Interactive Demonstration​

Core Goals and Principles​

🏛️ Decentralization

Power is transferred directly to the community, without centralized governing bodies.

🔍 Transparency

Every action, from creating a proposal to executing it, is recorded on the blockchain, enabling audits and analysis.

🎯 Encouraging Participation

Economic and social incentives are aimed at increasing participant responsibility and actively involving them in the decision-making process.

🛡️ Security and Stability

Mechanisms are introduced to protect against abuses and ensure network stability even under changing market conditions.

These principles allow the system to adapt to changes while remaining flexible and reliable.

Participant Roles​

In the CrossFi ecosystem, formal DAO governance is carried out exclusively by participants holding MPX tokens. These tokens grant the right to vote and make key decisions in the system.

👥 Delegators

Participants who hold MPX tokens and delegate their voting rights to chosen validators.

Key Features:

  • Direct Influence: Participate in votes, influencing strategic decisions
  • Economic Motivation: Receive rewards from validators (XFI, esXFI, WETH)
  • Risks: Unreliable validators may affect income and voting weight

⚡ Validators

Key participants responsible for network operation and security.

Key Features:

  • Security Function: Monitor network operation and prevent attacks
  • Active Governance: Direct voting rights on protocol decisions
  • Economic Support: Receive commission fees and bonuses
Community Participation

Active community members who don't hold MPX can still contribute through discussions and proposal ideas, though they cannot vote directly in the DAO.

Governance Process​

The governance process begins with creating proposals, which can be initiated by any participant holding a minimum amount of MPX. Proposals may address protocol upgrades, treasury fund distribution, or be text-based initiatives.

Proposal Lifecycle​

Understanding the complete lifecycle of a proposal is essential for effective participation in CrossFi governance. Each proposal goes through several distinct stages:

1
Proposal Creation
2
Deposit Period
3
Discussion Phase
4
Voting Period
5
Results Calculation
6
Execution
Step 1 of 6

Proposal Creation

A participant formulates a proposal with title, description, and type. The proposal must meet validation requirements before submission.

Requirements:

  • Clear title and detailed description
  • Specified proposal type
  • Initial deposit commitment

The proposal enters a deposit period where it must collect the minimum required deposit. During this time, any participant can contribute to the deposit.

Status: "Deposit Period"

Note: If the minimum deposit is not reached within the time limit, the proposal is automatically rejected.

Once the deposit threshold is met, community members can discuss the proposal through various channels:

  • Community forums
  • Official chat platforms
  • Discord channels

Comments and feedback are collected for potential adjustments.

The proposal moves to active voting where MPX holders cast their votes. The voting weight depends on the amount of staked MPX tokens.

Status: "Voting Period"

Duration: Fixed timeframe (automatically set)

After the voting period ends, results are automatically calculated based on:

  • Quorum requirements
  • Passing threshold
  • Veto threshold

If approved, the proposal is automatically executed:

  • Software Upgrade: Executes at specified block height
  • Community Pool Spend: Transfers funds automatically
  • Text Proposal: Marked as accepted (no automatic execution)

Proposal Types​

CrossFi Governance supports three distinct types of proposals, each with different execution mechanisms:

🔄 Software Upgrade

Purpose: Network protocol updates and improvements

Parameters:

  • Software version
  • Activation block height

Execution: Automatic at specified block

💰 Community Pool Spend

Purpose: Treasury fund allocation for projects

Parameters:

  • Amount to allocate
  • Recipient address
  • Purpose description

Execution: Automatic fund transfer

📝 Text Proposal

Purpose: Signal voting and community consensus

Parameters:

  • Title
  • Description only

Execution: Marked as accepted/rejected (no automatic action)

Voting Options​

When voting on proposals, MPX holders can choose from four options:

  • Vote for: Support the proposal
  • Vote against: Oppose the proposal
  • Abstain: Refrain from choosing
  • Veto: Decisive rejection that can lead to automatic dismissal
Voting Mechanics

If a delegator doesn't participate in voting, their vote is automatically counted via their chosen validator. However, if the delegator votes independently, their vote takes precedence.

Vote Inheritance System​

CrossFi implements a sophisticated vote inheritance mechanism that ensures all staked MPX tokens can participate in governance, even if delegators don't vote directly:

When Delegator Doesn't Vote

If a delegator does not cast their own vote, their voting power automatically inherits the validator's vote.

Example: Delegator stakes 1,000 MPX with Validator A. Validator A votes "Yes". If the delegator doesn't vote, their 1,000 MPX counts as "Yes".

Pro Tip

Delegators can always vote independently to express their own position, ensuring true decentralization even when delegating staking power.

Governance Parameters and Thresholds​

Understanding the key parameters that govern the voting process is crucial for successful proposal submission and passage. The following values represent the current configuration of CrossFi Chain Mainnet (October 2025).

Current Network Parameters

These parameters are configured on-chain and apply to all governance proposals on CrossFi Mainnet. Values are based on Cosmos SDK Governance module standards.

Network Configuration Overview​

The table below summarizes the core governance parameters currently active on CrossFi Chain:

ParameterValueDescription
Minimum Deposit100,000 MPXRequired deposit to create a proposal
Max Deposit Period2 daysTime to collect minimum deposit before voting
Voting Period2 daysDuration of active voting phase
Quorum33.40%Minimum participation for valid voting
Passing Threshold50.00%Minimum "Yes" votes to pass proposal
Veto Threshold33.40%"No with Veto" votes that reject and burn deposit

Detailed Parameter Explanations​

📊 Quorum: 33.40%

The minimum percentage of total staked MPX tokens that must participate in voting for the proposal to be considered valid.

Calculation:

  • Total votes (Yes + No + Abstain + Veto) / Total staked MPX ≥ 33.40%

Important: If quorum is not met, the proposal is automatically rejected regardless of vote distribution.

✅ Passing Threshold: 50.00%

The minimum percentage of "Yes" votes (excluding "Abstain") required for a proposal to pass.

Calculation:

  • Yes votes / (Yes + No + Veto votes) ≥ 50.00%

Note: "Abstain" votes count toward quorum but not toward the passing threshold.

🚫 Veto Threshold: 33.40%

The percentage of "No with Veto" votes that automatically rejects the proposal and burns the deposit.

Calculation:

  • Veto votes / (Yes + No + Abstain + Veto votes) ≥ 33.40%

Penalty: Deposit is permanently burned, not returned.

Deposit and Timeline Requirements​

Deposit Requirements

Proposals require a minimum deposit of 100,000 MPX to move from "Deposit Period" to "Voting Period".

Key Features:

  • Multi-Contributor: Multiple participants can contribute to reach the deposit threshold
  • Spam Protection: High deposit requirement prevents frivolous proposals
  • Refund Conditions: Deposit returned if proposal passes or fails normally (without veto)
  • Burn Condition: Deposit burned if veto threshold (33.40%) is reached

Deposit is locked during voting and returned/burned based on outcome.

Proposal Outcome Scenarios​

Understanding how different voting outcomes affect your proposal and deposit:

✅ Proposal Passes

Conditions:

  • Quorum ≥ 33.40% participation
  • Yes votes ≥ 50.00% of (Yes + No + Veto)
  • Veto votes < 33.40% of total votes

Result: Proposal executed, deposit returned

❌ Proposal Fails (Normal)

Conditions:

  • Quorum met, but Yes < 50.00%
  • Veto votes < 33.40%

Result: Proposal rejected, deposit returned

🚫 Proposal Vetoed

Conditions:

  • Veto votes ≥ 33.40% of total votes

Result: Proposal rejected, deposit burned

Use veto for spam, malicious, or fundamentally flawed proposals.

⚠️ Quorum Not Met

Conditions:

  • Total participation < 33.40%

Result: Proposal rejected, deposit returned

Encourage community participation to avoid this outcome.

💸 Deposit Not Collected

Conditions:

  • Deposit < 100,000 MPX after 2 days

Result: Proposal never reaches voting, all deposits returned

Deposit Risk

The only scenario where deposits are burned (not returned) is when the proposal receives ≥33.40% "No with Veto" votes. All other outcomes return deposits to contributors.

Protection and Incentive Mechanisms​

Several special mechanisms are in place to protect against abuses and ensure network stability:

🔒 Security Measures

  • Validator Limit: Capped at 64 validators
  • Sentry Nodes: Protection against DDoS attacks
  • Slashing: Penalties for rule violations

💰 Economic Incentives

  • Regular payouts for participation
  • Bonuses for long-term engagement
  • Additional rewards for active governance

Submitting Proposals and Voting in Practice​

Creating a Proposal​

1
Access XFI Console
2
Open GOV
3
Choose a Type
4
Fill Out Parameters
5
Make a Deposit
6
Publish
Step 1 of 6

Access XFI Console

Ensure you have at least 100,000 MPX available for the minimum deposit requirement.

Go to the GOV tab and click "Create proposal."

Software upgrade, Community pool spend, or Text.

  • Software upgrade: version, activation block.
  • Community pool spend: amount, address, purpose.
  • Text: only title and description.

Minimum 100,000 MPX required. If the deposit is insufficient after 2 days, the proposal is automatically rejected.

Multiple participants can contribute to reach the deposit threshold.

Once the 100,000 MPX deposit threshold is reached, the proposal immediately moves into the "Voting period" (2 days).

Voting Process​

1
View Details
2
Choose a Voting Option
3
Change Vote
4
Track Results
Step 1 of 4

View Details

In the GOV tab, select the proposal of interest and review its current status.

"Vote for," "Vote against," "Abstain," or "Veto."

Allowed until the voting ends, but an additional fee is charged.

After the voting period ends, the system announces the results.

Best Practices for Governance Participation​

Effective participation in CrossFi Governance requires understanding not just the mechanics, but also the community standards and best practices.

Creating Effective Proposals​

✍️ Clear Communication

  • Descriptive Title: Use clear, concise titles that immediately convey the proposal's purpose
  • Detailed Description: Provide comprehensive context, rationale, and expected outcomes
  • Structured Format: Use sections like Background, Goals, Implementation, and Impact

🤝 Community Engagement

  • Pre-Proposal Discussion: Share ideas in forums/Discord before formal submission
  • Address Concerns: Actively respond to community feedback and questions
  • Build Consensus: Gauge community sentiment before requiring deposits

For Validators​

Timely Voting: Vote early to allow delegators time to override if they disagree with your position.

Communication: Explain your voting rationale to delegators through social channels.

Responsibility: Remember that delegators trust you to act in the network's best interest.

For Delegators​

Monitor Proposals: Regularly check active proposals in XFI Console.

Read Carefully: Review full proposal details before voting.

Understand Impact: Consider how proposals affect the ecosystem and your stake.

Proposal Submission Checklist​

Before submitting a proposal, ensure you have:

📋 Documentation

  • ✅ Clear, descriptive title
  • ✅ Comprehensive description
  • ✅ Rationale and expected benefits
  • ✅ Implementation details (if applicable)
  • ✅ Timeline and milestones

🔍 Pre-Submission

  • ✅ Community discussion and feedback
  • ✅ Addressed major concerns
  • ✅ Sufficient MPX for deposit
  • ✅ Correct proposal type selected
  • ✅ Technical parameters verified
Important Reminders (CrossFi Mainnet October 2025)
  • Minimum Deposit: 100,000 MPX required (must be collected within 2 days)
  • Voting Duration: Exactly 2 days once deposit threshold is met
  • Quorum Required: 33.40% participation for valid voting
  • Passing Threshold: 50.00% "Yes" votes needed to pass
  • Veto Risk: ≥33.40% "No with Veto" votes burns the entire deposit
  • Vote changes incur additional transaction fees
  • Unbonding periods apply when switching validators

Frequently Asked Questions​

Voting Requirements & Access

  • Can I vote if I have very few MPX?
    Yes, but your voting weight will be lower compared to large holders. If you wish, you can delegate your tokens to a reliable validator.

  • Can I participate in Governance without MPX tokens?
    Direct voting is unavailable; however, you can submit ideas, join discussions, help shape public opinion, and engage in trading activities.

Validator Management

  • What if a validator acts against my interests?
    Re-delegate your delegated tokens to another validator after the "unbonding" period.

  • What are the penalties for abuses?
    If a validator breaks the rules, they may be slashed—meaning they lose part of their staked tokens. If a proposal fails due to veto thresholds, the initiator's deposit is not returned.

Proposal Outcomes & Deposits

  • What happens if there are too many "No with veto" votes?
    The proposal is rejected, and the initiator's deposit is withheld by the system.

  • What happens to my deposit if the proposal passes?
    When a proposal is approved and executed successfully, the full 100,000 MPX deposit is returned to all contributors.

  • What happens to the deposit if the proposal fails normally (not vetoed)?
    If the proposal fails to reach the 50% passing threshold but veto votes are below 33.40%, the deposit is returned to all contributors.

  • What happens if the minimum deposit is not collected during the deposit period?
    If the 100,000 MPX threshold is not reached within 2 days, the proposal is automatically rejected and all partial deposits are returned to contributors.

  • When exactly is the deposit burned?
    The deposit is permanently burned only when "No with Veto" votes reach or exceed 33.40% of total votes. This is the ONLY scenario where deposits are not returned.

The Future of Governance in CrossFi​

Development Roadmap

CrossFi Governance continues to evolve with planned improvements including enhanced analytics, better UX, and multi-chain integration capabilities.

📊 Analytical Expansion

Adding public monitoring dashboards for in-depth analysis of votes, proposals, and statistics.

🔗 Multi-Chain Integration

Interacting with other networks to attract new users and tokens to the ecosystem.

In Conclusion​

Governance on XFI Console is the foundation of decentralized management in the CrossFi ecosystem. Combining transparent processes, smart contract–based automation, and the active engagement of all community layers ensures the system's reliability and flexibility. This approach not only enables a prompt response to changes but also stimulates innovation, contributing to the platform's sustainable development.