Stake-Weighted Voting

Stake-weighted voting is a governance model where the weight of a participant's vote is determined by the amount of capital they have staked in the protocol. This ensures that those who have the most skin in the game have the greatest say in the decisions that affect their investment.

It is the standard for most proof-of-stake blockchains and many DeFi protocols, as it aligns governance with economic reality. However, it also presents risks, such as the potential for large holders to prioritize their own short-term profits over the long-term security of the network.

Many systems attempt to balance this by adding secondary factors, such as the duration of the stake or the reputation of the participant. It is a fundamental mechanism for ensuring that decision-makers are directly affected by the consequences of their votes.