7 - SHx Voting Power Delegation

This proposal asks whether SHx holders should be able to delegate their voting power to other addresses while retaining ownership of their tokens.

Event	Date	Notes
Snapshot Time	Sep 07, 2025 20:00 GMT
Vote Start	Sep 08, 2025 20:00 GMT
Vote End	Sep 12 2025 20:00 GMT
Results Published
Implementation

Description

Delegation would allow token holders to designate another address to vote on their behalf in governance proposals without transferring the underlying SHx tokens.

If implemented, delegation would be voluntary and revocable by the token holder. The delegator would retain full ownership and control of their SHx tokens, including the ability to transfer, stake, or use them in other protocol functions. Only the voting power associated with the tokens would be assigned to the delegate address.

Delegation to an address, or revocation, will be able to be performed at most once every 14 days.

Background

Currently, SHx holders must directly participate in governance votes to have their voice heard in protocol decisions. This creates several challenges for the ecosystem:

• Participation barriers: Many SHx holders may lack the time, technical knowledge, or interest to actively research and vote on every proposal, leading to lower overall governance participation rates.

• Institutional limitations: Some institutional holders, custodians, or multi-sig wallets face operational constraints that make direct voting difficult or impossible, effectively disenfranchising these stakeholders despite their significant protocol alignment.

• Expertise distribution: Certain proposals require specialized knowledge. Token holders may prefer to delegate their voting power to subject matter experts for specific types of proposals while retaining the ability to vote directly on others.

Delegation systems have been successfully implemented across numerous DeFi protocols, including Compound, Aave, and Uniswap, where they have demonstrably increased governance participation rates and improved decision-making quality. These systems typically allow both self-delegation (explicitly activating one's own voting power) and delegation to third parties.

The proposed delegation mechanism would operate on-chain through the Stellar network, ensuring transparency and auditability of all delegations. Delegates would not have access to the underlying tokens, only the voting power, maintaining security for token holders.

Voting Notes

This vote contains a single question asking whether the SHx protocol should implement a delegation system for voting power.

The delegation feature, if approved, would be optional. Token holders who do not actively delegate would retain their direct voting power as they do currently.

A "FOR" vote indicates support for implementing voting power delegation in the SHx protocol. An "AGAINST" vote indicates that voting should remain limited to direct participation only. An "ABSTAIN" vote indicates no preference on this matter.

As a Governance Rules amendment, this proposal requires a two-thirds (2/3) super-majority and a quorum of 25% of the active circulating supply to pass. If necessary, Stronghold will vote in alignment with the simple majority's preference to help implement the community's desired outcome.