Quick Start Guide: How to Participate in Cosmos On-Chain Governance?

Author: Cosmos blog- Notional Ventures

Link: https://daorayaki.org/post/647dc9797d59b85204d1189c




  • Code-based Proposals
  • Text-based Proposals

Proposal Lifecycle

  • Creation and Deposit
  • Voting Period
  • Quorum
  • Unanimous Consent
  • Threshold Passed




The Cosmos ecosystem is known for its “DPS” (Dramas Per Second), which at first glance might not seem like a good thing. But if you dig deeper, you’ll find that the source of this drama is that many people with different backgrounds and objectives are all trying to steer Cosmos in their preferred direction. So how can all these different participants steer together? Who’s in charge?

Actually, no one is in charge. Let’s take a closer look.


The Cosmos blockchain comes pre-packaged with a governance system — a decentralized decision-making process. At the protocol level, these decisions need to be expressed as proposals, which can be created without permission, voted on by validators and delegators, and submitted to the blockchain where they can be enforced by validators.

Proposals currently come in two forms: code-based or text-based. Users should choose which type of proposal to use depending on what they hope to achieve through their proposal.

1. Code-based Proposals

For example, suppose the Cosmos Hub community wants to increase the number of active validators from 175 to 200. Since this value is a parameter on-chain, changing it requires a simple code-based proposal. If successfully passed, the code in the proposal will automatically be adopted by all validators in the next block and the change will be made. In fact, you can view all the parameters that can be adjusted via governance using Mintscan¹ or other explorers.

Blockchains that have enabled CosmWasm (the smart contract platform for the Cosmos chain) can achieve more functionality through code-based governance.

Notably, chains like Osmosis, Juno, and Stargaze can automatically execute more complex software upgrades by using CosmWasm.

2. Text-based Proposals

Users can also submit text-based proposals that outline what should happen in plain language. This has many uses, including:

  • Requesting funds from the community pool

  • Resolving security issues that cannot be solved through code

  • Reaching consensus on governance rules

  • …and more.

It is worth noting that in the world of crypto assets, Cosmos is one of the few ecosystems with an on-chain voting system. Its functionality is generally considered somewhat limited at this time, but efforts are underway to expand its capabilities.

An interesting example is when Osmosis wanted to begin listing Ethereum assets on its decentralized exchange, it needed to choose a bridge (since Ethereum does not have IBC enabled) to allow for bi-directional asset transfers between the two blockchains.

The Osmosis team created a series of text-based proposals that allowed users to indicate which bridge they preferred. Proposals for the Axelar, Gravity, Nomad, and Wormhole bridges all went through the governance process, and because the Axelar bridge received the most support, it was chosen as the default bridge for transfers from Ethereum to Osmosis.

Proposal Lifecycle

New proposals must successfully advance through four “gates”, meeting four different criteria, before they can be passed and executed by the validator set. You can find detailed information about these criteria in the official SDK documentation². Each Cosmos blockchain can customize its governance process, and there are many on-chain parameters that can be adjusted, but in this article, I’ll be using the Cosmos Hub process and parameters as they were at the time of writing. You can find governance parameters for your favorite Cosmos blockchain on Mintscan.

1. Create and Deposit

Each proposal must secure funding through a deposit, which is a means of preventing spam by requiring a certain amount of tokens to be locked in escrow. Currently, the minimum deposit required for Cosmos Hub is 250 ATOM. Any proposal must reach this minimum deposit within 14 days (another on-chain parameter, called the maximum deposit period) to move into the voting period.

If I want to create a proposal on Cosmos Hub, I have two options:

  • Fund the entire deposit myself.

  • Seek community help with the deposit.

  • If I provide the funding for the proposal myself within 14 days, the proposal will automatically move into the voting period.

However, 250 ATOM is not a small amount, and may be a challenge for many users to afford upfront. Fortunately, Cosmos allows many different users to contribute deposits for any given proposal. If I can’t afford 250 ATOM on my own, I can seek support from the community.

However, caution is needed – if the proposal does not reach the minimum deposit within 14 days, the entire deposit will be burned, thus being completely removed. This is the main incentive mechanism to prevent fraudsters and other bad actors from creating malicious proposals.

Assuming my proposal successfully reaches the minimum deposit, it has passed the first threshold and now enters the voting period.

2. Voting Period

During the voting period, validators and delegators can vote on the proposal. The length of the voting period is also a chain parameter, currently set at 14 days on the Cosmos Hub. When governance participants vote, they have four options:

  • Approve

  • Reject

  • Veto

  • Abstain

The “approve” and “reject” options are relatively straightforward:

“Approve” usually means you want the proposal’s contents to be executed

“Reject” means you don’t agree.

“Veto” may be one of the more controversial options in Cosmos governance, as it signifies that you strongly oppose the proposal and believe that its creator intends to harm the community. We’ll discuss the details of this option more in the next section.

Finally, “abstain” can be used to indicate that you don’t have a strong preference on the proposal, but want to participate in the voting process.

During the voting period, the proposal must pass the final three thresholds in order to be executed by the validator set. Let’s take a look at each of these thresholds.

3. Quorum

The second threshold that my proposal must pass is that at least 40% of all staked ATOMs must vote on the proposal. When this requirement is met, it is called achieving quorum. This percentage is also a tunable chain parameter, so it may be changed in the future.

If quorum is not achieved (i.e. fewer than 40% of all staked ATOMs vote on it), the deposit will be automatically refunded to the deposit address and the proposal will no longer proceed.

4. Veto

Once a proposal has achieved the quorum, all votes must be tallied within a two-week window. If at the end of the voting period the proportion of “no” votes exceeds 33.4% (the veto threshold, another on-chain parameter), the proposal will fail and the deposit will be burned. This mechanism allows the community to punish participants they deem to have acted maliciously or with intent to harm the health of the blockchain. Regardless of what I want to accomplish with my proposal, I need to make sure the community doesn’t see it as inappropriate behavior so I don’t lose my deposit.

Assuming I get enough support, voters won’t veto my proposal.

5. Passing the Threshold

Finally, the last significant hurdle my proposal faces is whether people want it to pass. This is determined by a threshold parameter, which on the Cosmos Hub is currently set to 50%. To determine this, we use the following formula:

In other words, if the proportion of “yes” votes reaches 50% or higher (not including “abstain” votes), the proposal will pass.

If the proposal doesn’t reach this threshold, it will fail and the deposit will be automatically refunded to the deposit address. Here’s the entire process on the Cosmos Hub at the time of writing:


Now that you’ve learned how a proposal is created on-chain, let’s return to your role as an ordinary user: You’re staking some ATOMs and then creating a proposal. Ideally, you would:

  • Read the proposal.

  • Think about it.

  • Check out what your validators (and possibly other community thought leaders) think and why, and finally…

  • Vote.

If you choose not to vote, your staked ATOMs’ votes will be decided by the validators you delegated to, but you can always override their votes with your own. Even if you agree with your validators’ opinions, it’s still beneficial to vote yourself.

It’s worth noting that this voting isn’t done by “people” (since the software doesn’t know which addresses are controlled by one person or multiple people). Rather, the weight of the vote is proportional to the amount of staking held.

For example, if 100 ATOMs vote on a proposal and Notional has 10 staked ATOMs, our vote would account for 10%. Users with only 1 staked ATOM would have only 1% voting power.


Due to the existence of delegation and governance mechanisms, Cosmos is more political than most chains. This can be intimidating, but positively engaged users will help maintain cross-chain vibrancy and health, keeping it thriving for decades to come.


[1]: Mintscan Blockchain Explorer, https://www.mintscan.io/cosmos/parameters

[2]: Cosmos SDK Documentation, Governance Module: https://docs.cosmos.network/main/modules/gov

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