# Governance

BLUR is an ERC-20 token that governs key parameters of the Blur marketplace protocol and lending protocol ([Blend](https://twitter.com/blur_io/status/1653051809240604674?s=20)). **These parameters control the protocols' value accrual and distribution.** Voting is proportional to the amount of BLUR tokens a user owns or is delegated. In order to register their voting balance, a user must delegate their token balance to an address (either their own or someone else's). 

Most of the decisions made by the Blur DAO have on-chain results. To make sure that all decisions are well-informed, as well as properly communicated with the wider community, the governance process in Blur consists of multiple steps.

### Governance Proposals

There are three main categories a BIP (Blur Improvement Proposal) can fall under: Core, Process, or Informational. 

#### CORE <a href="#core-ecosystem-fund-allocation" id="core-ecosystem-fund-allocation"></a>

Proposals which require on-chain actions, including treasury grants. See [Governance Powers](#governance-powers).

#### PROCESS <a href="#process" id="process"></a>

Proposals for making a change to a process or implementation. Examples include procedures, guidelines, changes to the decision-making process, and changes to the tools or environment of the Blur DAO.

#### INFORMATIONAL <a href="#informational" id="informational"></a>

Proposals for general guidelines or information for the community.

### Governance Process

#### Phase 1 - Research forum

All ideas and proposals are initially published on the Research forum. The point of this is to receive community feedback. All the proposals go through a phase of improvements and objections. If the proposal is welcomed & feedback is incorporated, it can move on to the next step.

Discussion Timeframe: Minimum 7 days

Forum: [Go to research forum](https://gov.blur.foundation)

#### Phase 2 - Snapshot

The second phase is conducted through gas-less Snapshot voting. Community members who are delegated a minimum number of tokens are able to submit proposals that will be subject to a 14-day voting period. After the 14 days, if the proposal receives support from a majority of the participating votes, with a minimum of 30M BLUR yes votes, it can proceed to an on-chain execution vote.

Proposal Threshold: 100,000 BLUR

Voting Delay: 2 days

Voting Period: 14 days

Quorum: 30M BLUR

Forum: [Go to snapshot](https://snapshot.org/#/blurdao.eth)

#### Phase 3 - Tally

The next phase involves creating an on-chain proposal with code to be executed. Tally can be used as an interface to interact with the governance contract. On-chain proposals must be made by a member with the minimum number of tokens delegated, and must be based on a successful phase two vote. Once proposed, votes will last 14 days. If the proposal receives majority support, with a minimum of 120M BLUR yes votes, any member can queue the execution of the proposal, and after a 2-day execution delay, can execute the proposal.

Proposal Threshold: 30M BLUR

Voting Delay: 1 block

Voting Period: 14 days

Quorum: 120M BLUR

Execution Delay: 2 days

Forum: [Go to Tally](https://www.tally.xyz/gov/blur)

### Governance Powers

Community governance has the power to control the Blur protocols' value accrual and distribution

* Set marketplace protocol fee rate after 180 days (up to 2.5%)
* Set lending protocol fee rate for lenders and borrowers after 180 days
* Issue treasury grants

Governance can also perform these on-chain functions

* Set governor timelock
* Set timelock delay
* Set quorum minimum
* Cancel timelock executions
* Set proposal threshold
* Set voting period
* Set voting delay

### Committees

To streamline certain operations, some of the activities of the DAO are governed by committees. The committees will work to progressively transfer their functions to governance over time.

#### Safety Committee

The Safety Committee ensures that BIPs follow the governance process outlined above. The Safety Committee will prevent proposals that haven't followed the proper process from passing.

#### Marketplace Committee

The Marketplace Committee facilitates upgrades to the Blur marketplace contracts, aggregator contracts, and lending contracts. The Marketplace Committee executes policy decisions around highly dynamic subjects, such as royalties.

#### Incentive Committee

The Incentive Committee is tasked with incentive management for Blur users. The Incentive Committee can utilize up to 10% of the Genesis Supply for incentive programs (300M BLUR). The Incentive Committee may also loan out a portion of the budget to provide market liquidity for BLUR (currently: 21.9M BLUR). If all of the incentive budget is utilized, more can be allocated to the Incentive Committee via governance.