Top 10 Governance Tokens List You Need To Know In 2022

Top 10 Governance Tokens List You Need To Know In 2022

September 27, 2022 by Diana Ambolis
The buzzword for the current technological landscape is decentralization. Decentralization has been a key priority for developers and companies interested in the possibilities of blockchain ever since it entered the mainstream of technological discussions. It’s interesting to note that decentralized apps and blockchain-based solutions are no longer the only examples of decentralization. Decentralized autonomous organizations,
Top 10 Governance Tokens List You Need To Know In 2022

The buzzword for the current technological landscape is decentralization. Decentralization has been a key priority for developers and companies interested in the possibilities of blockchain ever since it entered the mainstream of technological discussions. It’s interesting to note that decentralized apps and blockchain-based solutions are no longer the only examples of decentralization. Decentralized autonomous organizations, or DAOs, have come under consideration due to the rising popularity of top governance tokens.

What will governance tokens’ future function be? Consider the development of entire organizations as a decentralized network of organizational members that allows the appropriate weightage of resources to each node. DAOs also guarantee decentralization by giving each member the same number of votes. With an overview of the most well-known governance token examples, the following post helps you identify the solution.

Governance Tokens’ History

The blockchain and cryptocurrency trends create a favorable environment for several fresh, creative breakthroughs with great potential for the future. Recent developments in the DeFi industry can demonstrate how blockchain holds enormous promise for the DeFi industry. Understanding how the top governance tokens used came before delving into their specifics is crucial.

Decentralized Autonomous Organizations, or DAOs, essentially a group of people adhering to specified rules for attaining common goals, are where governance tokens first appeared. The DAOs do not have a centralized governing body, and no one has ownership or influence over the entire business.

You may see how they have driven many well-known DAOs and DeFi initiatives by looking at the significant entries in a list of governance tokens. Smart contracts found in DAOs aid in the execution of certain actions upon the fulfillment of specific conditions. They can provide situations where it is untrustworthy to carry out transactions or share information. In addition, DAOs can lay the groundwork for organizations without hierarchical structure. Through the governance tokens, DAO members have equal power over the company. Examples of governance token applications should emphasize how they provide the DAO voting rights structure. The fundamentals of governance tokens demonstrate their importance and the need for you to know about them.

In 2022, the most widely used governance tokens.

Anything with decentralization components, such as NFTs, DeFi, and the metaverse, is a part of the “decentralized ecosystem.” In these decentralized projects, governance has been emphasized, particularly for creating one of the fundamental principles of blockchain. One of the essential elements of the newly developing decentralized ecosystem is governance tokens.

DAOs could ensure that the people are in charge with the aid of governance tokens. DeFi technologies’ DAOs are now the main beneficiaries of governance tokens. Metaverse DAOs, on the other hand, are also possible and have recently had a big impact.

Here is a list of the top governance tokens for 2022 that you need to be aware of.

1. Curve DAO 

A list of crypto governance tokens might include the Curve DAO’s CRV token as one of its initial instances. One of the most well-known DeFi apps, Curve has both functionalities as a liquidity provider and a market-maker system. In 2020, the CRV coin was released as a tool to facilitate on-chain governance.

The Curve DAO controls the platform’s operations, highlighting the significance of CRV tokens. The CRV governance token decides how the platform operates and how it should advance in the future. Most importantly, a governance token’s function in executing automated market orders and providing users with a liquidity pool can create new precedents for the development of DeFi.

2. Uniswap DAO 

Decentralized DEX has assisted in laying the foundation for a major DAO in the current era with the aid of Uniswap’s governance token, UNI. In September 2020, Uniswap, a well-known decentralized exchange, also added its name to the list of top governance tokens. Uniswap experienced a significant increase in trading volumes after lowering trading fees for some stablecoin swaps. The increase in Uniswap trading volume indicates that customers are leaving other DeFi projects.

The Uniswap DAO, which is most significant, also made news in May with its request to transfer $40 million from the project treasury. However, prominent representatives from major corporations made up most of the users who supported the plan. The UNI governance token entered the picture and ensured that the plan was rejected, even if it had a smaller budget.

One of the best governance token examples is UNI, which demonstrates how governance may be decentralized. Collective accountability for Uniswap governance, the UNI community treasury, the Uniswap Default List, and the SOCKS liquidity token is granted via the UNI token.

3. Aave

Aave is a well-known decentralized lending platform for cryptocurrencies that allows for direct communication between lenders and borrowers. The Ethereum blockchain serves as the main support for the Aave protocol. AAVE’s native token of the Aave protocol would be the next noteworthy item on a list of crypto governance tokens.

Additionally, the popularity of Aave suggests the potential for network integration. Early in 2021, the AAVE token had a sharp surge of 2300 percent, earning praise from many investors as one of the top DeFi coins. Nevertheless, no one has ever been spared by the extreme volatility of the cryptocurrency market, and AAVE is no different.

In addition to functioning as a cryptocurrency token, AAVE grants token owners special governance rights. Owners of tokens had the opportunity to share their opinions on the Aave protocol’s future. Owners of AAVE tokens can decide whether to use treasury funds or build new features, just like a DAO. AAVE can also be used as collateral within the AAVE protocol, which opens up opportunities for reducing transaction costs.

4. Compound 

The compound should be included on the list of top governance tokens designed for DAOs with decentralized governance. It is a hopeful illustration of how well DAOs work in the DeFi space to make it easier for people to obtain crypto financing. Investors might lock the governance tokens in the Compound system along with initiating interest payments.

The capability of distributing interest on the assets they offer to the platform is a remarkable feature of Compound protocol. The decentralized lending platform provides a useful entry point into the DeFi ecosystem while giving users access to governance.

Every token entails a significant vote in the discussion of proposals for governing bodies. One well-known governance token example that has a real impact on securing bitcoin lending is the COMP token. The platform can assist users in borrowing cryptocurrency while guaranteeing the entire procedure’s decentralization. In addition to guaranteeing these advantages, COMP also gives compound ecosystem users more power. The compound guarantees the process anonymity while not requiring credit checks from potential borrowers.

5. Decentralization

Another gaming environment for LAND, a high pick on a list of crypto governance tokens, is the Decentraland metaverse. The virtual parcels of land are represented by LAND NFT tokens and MANA token acts as the platform’s cryptocurrency. Instead of a central authority, a decentralized entity is in charge of overseeing the virtual land parcels. The Decentraland DAO operates more like a neighborhood association or a community engaged in decentralized city planning.

Decentraland DAO is gradually attracting more users, and several major corporations are investing significantly. Last year, a virtual block of land in the Decentraland metaverse sold for $2.4 million at auction. Samsung has additionally established its virtual headquarters in Decentraland. Every user might vote on the planning decisions according to their ownership stake in the Decentraland metaverse.

Also Read: What Are Governance Tokens and Why Should You Care?

6. 0x

Because of its features, 0x is also mentioned among the top governance tokens. The Ethereum blockchain underpinnings enable peer-to-peer transactions, making it a preferred option among DAO projects. In April 2021, 0x laid the groundwork for the transition to DAO governance and planned the transition. It would be primarily concerned with maintaining the community’s sole treasury.

ZRX, the native token of 0x DAO, may soon rank among the most well-liked and value-based governance tokens available for DAOs. The cryptocurrency does not currently have any governance rights over project improvements. Instead, it would give significant token holders the duty of overseeing treasury funds and fostering a good impact on the ecosystem.

7. Decred 

Decred was created on its blockchain, unlike the previous DAO projects. The most significant aspect is that Decred uses a hybrid consensus mechanism that combines Proof-of-Stake and Proof-of-Work protocols. Members can buy tickets or participate in governance ideas through the decentralized protocol. You may come across Decred while looking for various governance token kinds samples.

DCR, Decred’s governance token, was crucial in resolving the scalability problems that buyers of Bitcoin were experiencing. Decred uses the DAO architecture to allow community members to cast votes using DCR on various DAO initiatives. Decred is a decentralized platform that runs alongside it, emphasizing the feature of self-governance. Decred, therefore, poses some noticeable challenges when undergoing a hard fork.

8. Dash

Another well-liked option among the top governance tokens you should be on the lookout for right now is the DASH token. It is one of the most noteworthy instances of employing DAO initiatives to support upcoming DeFi improvements. Compared to Bitcoin, the DAO initiative might guarantee speedier transaction times.

It aspires to establish new standards for using DAOs in cryptocurrency applications and decentralized digital payments. It’s interesting to note that DASH has had rapid growth recently. More than 10 million DASH coins have been distributed as of right now. Most importantly, DASH has recently experienced growth thanks to its emphasis on anonymity.

9. MakerDAO 

Among the well-known governance tokens, MakerDAO and its stablecoin MKR are other well-known names. A special governance token from MakerDAO has the value of an algorithmic stablecoin. As a result, it has emerged as one of the most popular platforms for collaborating with various decentralized entities.

The DAO project is concerned with both assuring the successful onboarding of non-crypto assets and investigating new and potential chances for crypto trends. It’s interesting to note that MKR token owners provided one real-world example of how projects might be impacted by decentralized governance. The usage of tokenized versions of freight and shipping invoices and short-term trade receivables was approved by MKR holders.

10. Friends with Benefits DAO

The final inclusion among the top governance tokens would mention FWB, the native token for the exclusive membership club Friends with Benefits. The project focuses on testing the usage of web3 to change the value of social networks. The functionalities of the FWB governance token and applications for governance tokens generally share a lot in common.

Users can buy FWB tokens, and having more allows them to participate in more activities. When you have five DAO tokens, you can guarantee the accessibility of the Cities Initiative by FWB and have exclusive access to various community-driven activities.

To sum up

The decentralization movement is expanding for all the right reasons. Governance has become the top priority as the DeFi landscape, NFTs, and metaverse projects expand. Relying on decentralized governance would be the best course of action for the governance of new blockchain-based applications and cryptocurrency projects. The in-depth analysis of the various entries’ functions in the list of governance tokens demonstrates their importance for the future of cryptocurrency.

Worries about the market’s instability have hampered users’ involvement in cryptocurrency. Now that users have a role in determining the direction of the entire project, governance tokens return power to their hands. Find out more about decentralized governance and the future of governance tokens. Discover fresh educational materials about DAOs, DeFi, and governance tokens immediately.