# Governance Token Utility

The Nebula token plays a central role in governance, empowering users with voting rights and incentivizing participation.

#### **Voting Power**

* Determined by the number of tokens a participant holds or stakes in the protocol.
* Staking Nebula tokens enhances voting power and earns participants additional rewards.

#### **Proposal Submission**

* A minimum token threshold (e.g., 1% of total supply) is required to submit proposals.
* This ensures that only serious and well-considered proposals are submitted.

#### **Incentives for Participation**

* Active participants in governance earn rewards in Nebula tokens.
* Rewards are distributed proportionally based on voting activity and the number of tokens staked.

#### **Equalizing Influence: Quadratic Voting**

* Quadratic voting prevents large token holders from exerting disproportionate control by making the cost of additional votes increase quadratically.
* This system amplifies the voice of smaller holders, promoting a more democratic decision-making process.

#### **Community Engagement**

* By leveling the playing field, quadratic voting encourages broader participation in governance, strengthening the protocol's alignment with its user base.

<br>