Governance actions and updates in the Liqwid protocol are proposed and voted on by LQ governance token holders, set in motion through specific on-chain mechanisms; Agora governance module (including delegation and Timelock) and the LQ governance token. Collectively these on-chain mechanisms enable the Liqwid community to delegate voting power, propose protocol changes, vote and execute updates via the Governor contract. Liqwid Improvement Proposals (LIPs) can modify the protocol's economic or governance parameters, whitelist new markets, or introduce completely new features to the protocol.
LQ governance token holders can delegate their voting power to a Liqwid community governance participant, themselves or any other Cardano addr1 they decide to. Cardano addresses delegated at minimum 1% of circulating LQ supply can launch governance proposals. Cardano addresses delegated at minimum 210 LQ can submit a draft proposal which will require a co-sign from one or more Cardano addresses delegated at minimum 1% of circulating LQ supply to move the draft proposal into the launched proposal phase. When a Liqwid Improvement Proposal is launched, it enters a 1 day community review period, after this time voting actions begin tally and the active voting phase starts. Active voting period by default lasts for 2 days. If 50% or more of voting actions are for the proposal, and the quorum of 10% of circulating LQ supply is achieved, the proposal successfully enters the Timelock for 1 day and can be executed after this time. From start to finish any update to the protocol by default requires 4 days (the length of time for each proposal phase is configurable and can be increased or reduced through a governance proposal).