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Version: mainnet (v0.72)


Governance allows the Vega network to arrive at on-chain decisions, where tokenholders can create proposals that other tokenholders can vote to approve or reject.

Vega supports on-chain proposals for creating markets and assets, and changing network parameters, markets and assets. Vega also supports freeform proposals for community suggestions that will not be enacted on-chain.

Taking part in governance by voting, or by proposing additions/changes with community support, is a way for tokenholders and community members to contribute to improve the network, and to add value for other network participants.

Voting on proposals

VEGA tokenholders can vote for or against any active proposals, and there's no limit to how many active proposals they can vote on.

The tokens that a tokenholder wants to vote with must be associated with their Vega public key. It's not necessary to have those tokens nominated to validators, but the tokens must be associated to the Vega key used for voting.

Tokenolders can vote on a proposal as soon as it passes validation and is active, and can be voted on until it reaches the closing date/time.

  • The number of tokens associated with the voting key determines how much weight the vote has. For market parameter change proposals, the liquidity providers' market share is also taken into account.
  • Each Vega public key with a non-zero token balance gets one vote, and the key votes with the full weight of all the tokens that key has associated to it.
  • The Vega key used for voting will need to have more than 0 tokens when a vote is submitted, as well as when votes are counted at the proposal's closing date/time, otherwise the vote is disregarded.
  • Tokens used for voting are not locked or transferred: they can be used for staking as well as for voting on any/all active proposals.
  • While the voting period is open, a public key can change their vote, but only the most recent vote will count at the proposal's close.

How a proposal's outcome is calculated

  • The network compares the weight of all valid votes cast as a percentage of the total weight that could vote, to the minimum participation requirement - participation_rate = SUM (weightings of ALL valid votes cast) / max total weighting possible
  • The network compares the weight of all 'for' votes, as a percentage of the weight of all votes cast, to the required majority - for_rate = SUM (weightings of votes cast for) / SUM (weightings of all votes cast)
  • If the minimum for both is reached, the proposal is enacted. If at least one is not reached, the proposal fails.

Proposal outcome: Update market

For proposals to update a market, there are additional requirements. The market's liquidity providers can vote with their equity-like share without requiring tokenholder participation. However, if tokenholders vote and participation and majority requirements for this vote are met, then the tokenholders' votes can overrule the liquidity providers' votes.

The network will also calculate:

  • The LP participation rate, which is the sum of the equity-like share of all LPs who cast a vote - LP participation rate = SUM (equity-like share of all LPs who cast a vote)
  • The rate of 'for' votes cast by liquidity providers, calculated as the sum of all who voted 'for', divided by the LP participation rate - LP for rate = SUM (all who voted for) / LP participation rate

The proposal will pass if one of the two scenarios occur:

  1. The tokenholder vote meets or exceeds the minimum set by 🔗governance.proposal.updateMarketParam.requiredParticipation, and the votes in favour are greater than the amount set by 🔗governance.proposal.updateMarketParam.requiredMajority. In this case the market's liquidity providers were overridden by governance token holders.
  2. The governance tokenholder vote does not reach participation threshold, but the liquidity providers' votes do, and there are enough votes in favour. The participation rate must be greater than/equal to 🔗governance.proposal.updateMarketParam.requiredParticipation, and the liquidity providers' participation rate must be greater than/equal to 🔗governance.proposal.updateMarketParam.requiredParticipationLP, and the liquidity providers' votes in favour is greater than/equal to 🔗governance.proposal.updateMarketParam.requiredMajorityLP

Proposal outcome: Successor market

For proposals adding a new successor market, the outcome of the proposal can change even after it's been approved.

If a parent market is still in its proposed state, its successor market cannot be enacted, even if it passes the vote.

Two proposals that name the same parent can be submitted and pass a governance vote. Whichever market clears its opening auction first gets the share of the insurance pool, and the liquidity providers' equity-like share is moved to that market. The second market will then be rejected.

Try it out

Vote on active proposals on the Vega governance dApp ↗.

Lifecycle of a governance proposal

Proposing an addition or change to the network requires community support. It's worth considering what it contributes to the network, and if it would have enough support to pass a governance vote. You'll have a better chance of positively contributing to the network if you confirm there is support off-chain before submitting a proposal.

1. Sense checking proposal idea (off-chain)

Before submitting a proposal, it's recommended that you share an outline of your proposed action informally in a new topic on the community forum ↗ Governance Proposals section, with a "sense-check" tag. You can find out if there is sufficient interest in making a change.

Proposals can be submitted for creating a new market, amending an existing market, changing network parameters, adding an external asset to Vega and making a freeform proposal (for changes that will not change network behaviour).

2. Formalising proposal (off-chain)

Once the proposal details are refined, share the detailed proposal in the same topic you created for your sense check, and change the tag to "formalise".

Including as much detail as possible gives other community members the opportunity to fully understand your proposal. Include the rationale for the proposal (and IPFS hash for more details), the specifics of the proposed addition/change, and the data (JSON or similar) that would be submitted on-chain. Invite debate and discussion to amend the proposal until it reaches a final state, ready to submit.

When formalising the proposal, it is worth ensuring that any fields that are dependent on a range set by network parameters are correctly defined. See the network parameters and their values on the Vega block explorer ↗.

3. Submitting proposal and telling the community (on-chain and off-chain)

Tokenholders can submit a governance proposal to the network using the command line or via a script.

The Vega public key of the proposer must have enough VEGA staked to submit a proposal. For a 'market parameter change' proposal, the proposer must also have enough equity-like share in the market from their liquidity commitment, which is defined in the network parameter 🔗governance.proposal.updateMarket.minProposerEquityLikeShare: 0.

Proposals are first checked by the wallet, then verified by the nodes before entering into the voting period you set. A proposal must have all of the relevant information, in the correct format, and in some cases within the accepted range - otherwise it will be rejected immediately.

A proposal cannot be changed once entered.

Once a proposal is submitted and accepted, rally the community to vote on the proposal by announcing it on the forum ↗, Discord ↗, and through your own networks to vote on the proposal.

Try it out

Read the proposals guides to see what information needs to be in a proposal, and how to submit them using the command line.

Validating a proposal

  • The governance proposal is checked and then accepted by the wallet as a transaction.
  • The validator nodes then check and validate the proposal. This is when the proposal data that defines the minimum duration, minimum time to enactment, minimum participation rate, and required majority are evaluated against the network's requirements, defined by network parameters ↗, which are different depending the type of proposal.
  • If not specified on the proposal, the required participation rate and majority for success are defined and copied to the proposal. You can find them under the network parameters ↗, and they are specific to each proposal type.
  • If the above conditions are not met, the proposal will be rejected and will not be available for a vote. You'll need to fix and re-submit the proposal.

4. Voting (on-chain)

VEGA tokenholders - including those who submitted a proposal - can vote for or against any active proposals, with the full weight of the tokens associated with each public key.

Read more about voting.

5. Enacting changes (on-chain)

If a proposal receives enough token weight in favour within the enactment period, the change/addition is accepted (except for a freeform proposal), and will be enacted on the enactment date defined in the proposal.

Note the enactment date must be at least the minimum enactment period for the proposal type/subtype (specified by a network parameter for each proposal type) after voting closes. See the network parameters and their values on the Vega block explorer ↗.

Thresholds set by network parameters

Certain governance parameters need to be within a defined range, but offer some flexibility.

When a submitted governance proposal is validated, the values chosen will be checked to ensure they fit within the thresholds, which themselves are defined by network parameters.

Each type of governance proposal can have different thresholds, though they fit into broader categories. Those categories include:

  • minProposerBalance: Minimum amount of VEGA that a proposer needs to have associated with their Vega key to have the proposal accepted for a tokenholder vote
  • minClose: Minimum amount of time before a proposal can be closed for voting
  • maxClose: Maximum amount of time a proposal can be open for voting
  • minEnactment: Minimum time allowed between vote closing on a proposal and the proposal's change being enacted on the network
  • maxEnactment: Maximum time allowed between vote closing on a proposal and the proposal's change being enacted on the network
  • requiredParticipation: Minimum number of tokens that must vote for a proposal to pass
  • requiredMajority: Minimum majority that a proposal's 'yes' votes must reach for it to be enacted

As these thresholds are network parameters, their values can be changed through governance.

Query for data

See the current values (in some cases, different per network) on the block explorer ↗.

Otherwise, use REST to see the network parameters and their values.


Consider a network parameter that specifies the proportion of fees that goes to validators (🔗transfer.fee.factor: 0.001). Each of the following thresholds would need to be met:

Asset governance

Assets need to be proposed and pass a governance vote before they can be used on the Vega network.

The protocol currently supports adding ERC-20 assets. Those ERC-20 assets that are successfully validated and pass a governance vote are can be enabled via the Vega bridge. In practice, that means that assets on Vega are deposited from and withdrawn to Ethereum.

After a new asset vote passes, the change has to be submitted to the asset bridge on Ethereum. Until it has been submitted, no one can start depositing that asset.

Certain asset details can also be changed through a governance proposal. While the contract-level details are immutable, the protocol-level details can be changed.

Learn more

ERC-20 asset validation

When adding an ERC-20 asset to the bridge, the key details are compared to the smart contract on Ethereum.


  • The contract must be an ERC-20 asset
  • The name and symbol must match the contract
  • There cannot be multiple assets on a Vega network for the same ERC-20 asset

Market governance

Markets are proposed and voted into existence by Vega tokenholders. The parameters for a market all need to be defined in the proposal.

Some market parameters can also be changed. They can only be proposed by a liquidity provider with enough equity-like share in the market, and need to be voted for by a sufficient number of tokenholders and/or liquidity providers.

When creating a market governance proposal, whether it is for a new market, a new successor market, or to change parameters for an existing market, it's recommended that you sense check the proposal and share the final details with the tokenholder community before proposing, so that you can garner support and make any necessary amends.

Read more:

Propose a new market

Tokenholders can propose new markets, which then need to be voted on by other tokenholders. The proposer will need to have at least 🔗20000000000000000000000 tokens, associated with the public key you're using to propose the market, and staked to a validator. Note, this amount is set through the network parameter 🔗

If the market proposal gets a 🔗66% majority of tokenholder support, then it will be enacted. The required majority is defined by the network parameter 🔗

To propose a market, you'll need to provide the details required for the market to begin trading right away. While some of the fields are free-text, others are constrained by a range set through network parameters, to ensure that the values provided are fit for purpose.

Required fields include:

  • Instrument details, including a human-readable name, an understandable shortcode for the market, the type of product (futures)
  • Risk model parameters
  • Product specifics including the settlement asset and quote name
  • Decimal places for the market and positions. (Note: A market cannot specify more decimal places than its settlement asset supports)
  • Oracle details, including the oracle's public key, specifications for the settlement price and trading termination, and data filters
  • Liquidity monitoring parameters, including the target stake parameters, triggering ratio and auction extension

Optional fields include:

  • Metadata so that people can easily interpret the market's details - while this is optional, it's highly recommended that you include metadata for the market
  • Liquidity commitment: the amount committed, proposed fee level, and the buy and sell order shapes. Note: Once a market is proposed, it can accept liquidity commitments from any party
  • Price monitoring parameters, including the triggers covering the horizon, probability and auction extension time. If left blank these parameters will default to the values set in the network parameters

Risk models and parameters

When proposing a market, the market proposer will need to choose the risk parameters associated with the risk model that's appropriate for the instrument. The acceptable amount of volatility on a market is driven by its risk model. The risk model is essential for calculating margins on the market.

The log-normal risk model is the only one currently supported. While the model is pre-defined, you'll need to choose the individual parameters.

You should choose parameters that ensure the risk model adequately represents the dynamics of the underlying instrument, and that the resulting margins strike the right balance between prudence and capital efficiency.

Below are the risk parameters, the accepted values for each parameter and suggested values for some. When suggested values are provided, these should be used as a reference point and to aid in deciding on what's appropriate for the market, not in place of rigorous analysis and calibration.

Model-independent parameters used in margin calculation are:

  • Risk aversion lambda - probability confidence level used in expected shortfall ↗ calculation when obtaining the maintenance margin level. This enters the margin calculation as follows. First, the value at risk, defined by confidence lambda is calculated. This is the cash amount that one would need to add to the position to make the probability of the value of the position and cash going negative after time tau to be less than lambda. The margin is then the expected loss of the position given that it incurred a loss bigger than the value at risk.
    • accepted values: strictly greater than 0 and strictly smaller than 1
    • suggested value: 0.00001
  • Tau - projection horizon measured as a year fraction used in the expected shortfall calculation to obtain the maintenance margin:
    • accepted values: any strictly non-negative real number,
    • suggested value: 0.000114077116130504 - corresponds to one hour expressed as year fraction
  • Risk free rate - annualised growth rate of the risk-free asset, it's used for discounting of future cash flows:
    • accepted values: any real number,
    • suggested value: 0.

The remaining, model specific parameters are covered below.

Go deeper

Margins and Credit Risk on Vega ↗ - Note, a position size of 1 is assumed throughout the research paper.

Log-normal risk model

The log-normal model assumes that the logarithm of the price increments are normally distributed. The main model parameter is

  • Volatility (Sigma) - annualised historical volatility of the underlying asset:
    • accepted values: any strictly non-negative real number,
    • suggested value: asset dependent, should be derived from the historical time-series of prices, and a typical value would be 0.8 = 80%

Another parameter is

  • Mu - annualised growth rate of the underlying asset:
    • accepted values: any real number,
    • suggested value: in almost all situations 0 is the value to use

Propose a successor market

A successor market is a market that will carry on after the original market, or parent, that it is based on has settled - though a parent and successor market can be active simultaneously. Proposing a new successor market that follows from an existing market offers liquidity providers the option to keep their equity-like share on the new market, even when the original market expires. Creating an entirely new market with no parent doesn't offer the same benefit.

Each market can have only one active successor. A successor market can also be a parent market.

In terms of the proposal format, there are only two differences between a succesor market proposal and that for a regular market, and one field that ties the successor to the parent market.

  • Parent market ID: Required to define the proposal as for a successor market
  • Insurance pool percentage: Required percentage of the parent market's insurance pool, up to 100%, can be earmarked for transfer to the successor market. It is submitted as a number between and including 0 and 1, which represents the factor for the percentage.
  • Settlement asset validation: The settlement asset needs to match that of the parent market

For a successor market to be enacted, the parent market must be in one of the following states: proposed, pending, active, suspended or trading terminated.

The parent market can be settled or cancelled when the successor market reaches enactment time, as long as the time it's been settled/cancelled is equal to or less than the parent market's settlement time plus the market.liquidity.successorLaunchWindowLength - determined by a network parameter. This parameter specifies for how long after a market has settled, the liquidity provider's equity-like share data are retained and the insurance pool is left undistributed to allow a successor to be defined. If the successor is proposed after that time, then it's rejected and any assets committed to the market are returned.

Propose updates to a market

Most details about a market can be changed through governance. Those includes risk models, monitoring triggers, and the settlement and termination data sources.

However, there are a few that cannot be edited, and will be the same for the duration of the market's life.

  • Name: Market name, which should be a short, descriptive and relevant name
  • Settlement asset: Asset used for margin, liquidity, and to settle positions
  • Decimal places/precision for:
    • Market - Sets the smallest price increment on the book. A market cannot specify more decimal places than its settlement asset supports
    • Position - Precision of the position size

Network parameter governance

There are certain parameters within Vega that influence the behaviour of the system and can be changed by on-chain governance. Vega tokenholders can define the optimal network configuration by creating and voting on network parameter proposals to change the values of existing network parameters.

Network parameters can only be added and removed with Vega core software releases.

Suggested ranges for parameters

Some network parameters have minimum/maximum boundaries to ensure they aren't supplied with nonsensical values. The table below contains those parameters, to be used as guidance when proposing changes to any of those parameters.

Parameter nameMinimum/Maximum
reward.staking.delegation.competitionLevelMinimum value 1 (inclusive), no maximum.
governance.proposal.(TYPE).minEnactMust be greater than / equal to the corresponding minClose, proposal can't be enacted before voting on it has closed.
governance.proposal.(TYPE).requiredMajorityMinimum 0.0, maximum 1.0. Is multiplied by 100 to get percentage.
governance.proposal.(TYPE).requiredParticipationMinimum 0.0, maximum 1.0. Is multiplied by 100 to get percentage.