General FAQ

All you need to know about Algorand's operations.

The Foundation

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What is the Borderless Economy?

Algorand and the Algorand Foundation have a vision for the borderless economy. At its most basic level, this is a digital economy where anything of value can be traded between two or more parties without the friction of current financial networks.

What is the relationship between Algorand Foundation and Algorand Inc?

The Algorand Foundation operates independently from Algorand Inc. The Algorand Foundation is a not-for-profit, community organisation focused on protocol governance, token dynamics and supporting grassroots, open-source development on the Algorand ecosystem. Algorand Inc is focused on layer-1 development of the Algorand Protocol and enabling Enterprise adoption of Algorand blockchain technology.

The Foundation and Inc. collaborate on exciting projects and initiatives to customize the value that we can bring towards the great Algorand community.

What do I need to do to earn participation rewards?

Participation rewards are now fully distributed per May 14th, 2022, and completely replaced by Governance Rewards moving forward. To participate in Algorand Community Governance and earn Governance rewards please see Algorand Community Governance.

Wallets

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Are there other wallets which support the Algo? Do you have a list of all the genuine/approved wallets available?

Algorand does not have an approval policy for wallet support, and each wallet operator makes its own determination to support a cryptocurrency. A partial list of wallets supporting Algo and information related to wallets is available on Algo Page. The security of these wallets should be checked with the vendor directly. Algorand makes no representations regarding the functioning or security of third party wallets, and disclaims any liability therefor.

For information related to wallet security please read our Guide to Wallet Security and Best Practices.

Algo Supply

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What is the max supply cap for Algorand?

The Max Supply for Algo is the 10 billion Algo minted at genesis.

Even though the entirety of the supply was minted at the launch of the network, thus giving Algorand a fixed outstanding supply, the liquid supply will increase as pre-minted tokens unlock and are distributed.  

The Foundation recently proposed a revised, long term Algo Dynamics model. Designed to run for a greater than 10-year period- that is up to 2030 and beyond - this new model will focus on programs around ecosystem support, community incentives, and the decentralization of decision making and governance on the Algorand blockchain - a long-held goal of the Algorand community. For more information on Algo supply and distribution see Tokenomics.

Does the Foundation own tokens?

The Foundation’s stake is 500M Algos (and the participation and governance rewards). This stake participates in the consensus protocol contributing to the protocol’s integrity.

What is the current circulating supply?

You can see the current circulating supply on AlgoExplorer and PureStake’s GoalSeeker.

Is there someplace where I can see a good description of how the initial Algo token distribution occurred, and how much stake the Algorand Foundation has in the network?

A good description is available on our Tokenomics page.

Is there a burning process for Algos?

The Algorand Foundation burnt the tokens from the initial auction that were refunded. For further information see:

June 2019: Burn of Early Redemption Auction Tokens

July 2020: Auction Redemption Complete: Redeemed tokens permanently removed from supply

Relay Nodes

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What nodes comprise the Algorand network?

The Algorand network is comprised of two distinct types of nodes: relay and participation nodes.

Relay nodes are primarily used for communication over the network.

Participation nodes can participate in the Algorand consensus protocol, and they communicate with each other (and with the blockchain) via the relay-node layer.

For more information, see the Algorand developer documentation.

Are there rewards for running nodes on Algorand?

Currently, the Algorand protocol does not include rewards for running nodes on the network.

As described below, the Algorand Foundation announces programs from time to time where it provides support for partners to run relay nodes.

Who is running relay nodes on the Algorand network?

While in principle anyone can run a relay node, the default behavior of an Algorand node is to only connect to relay nodes from a list that the Algorand Foundation maintains.

The relay nodes on that list are operated by Algorand Inc., Algorand Foundation, and participants in a few relay-node-running programs of the Foundation:

  • Until 2021, the Algorand Foundation issued token grants to Early Backers for running relay nodes. That program is now over, but some of the participants are still running relay nodes (with no support from the Foundation).
  • The Algorand Foundation also issued token grants to ten universities who are running relay nodes. This program is scheduled to run through Q2 2024.
  • In Q4 2021, the Foundation launched a Pilot Relay Node Program where it selected about 20 companies and individuals and provided support for them to run relay nodes in different configurations.
  • In Q2 2022, the Foundation launched a Community Relay Node Program where participants had to stake Algos in addition to running relay nodes. Eight companies were selected to this program, running additional 19 relay nodes.

How many relay nodes are there?

As of Q2 2022, there are just under 120 relay nodes on the Algorand network.

Who manages the list of relay nodes? What about decentralization?

Currently, the Algorand Foundation manages the official list of relay nodes, to bootstrap a scalable and reliable initial infrastructure backbone.

It is important to stress, however, that anybody with an Algorand account can run a non-relay node and participate in the Algorand consensus protocol (i.e., be a validator).

Moreover, the integrity of the blockchain does not depend on the relay nodes: as long as sufficiently many participation nodes (in terms of stake) behave honestly, the blockchain cannot fork.

Even if all the relays misbehave, the worst that can happen is that the blockchain will slow down or stall.

The Algorand Foundation is researching options for making the decisions on relay nodes in a more decentralized way.

Participation Nodes

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How can I participate in the Algorand consensus protocol?

Instructions for setting up participation nodes on Algorand and participating in the consensus protocol can be found off of the Algorand developer site.

See in particular https://developer.algorand.org/docs/run-a-node/setup/types/#start-node and https://developer.algorand.org/docs/run-a-node/participate/.

How many Algos do I need to run a participation node?

A participation node can be run for any Algorand account, whatever its balance is.

*Note however that any Algorand account must have a minimum balance of 0.1 Algo.

Algorand Foundation Ecosystem Funding Mechanism

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Fees

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Do sending and transacting with an Algorand Standard Asset (ASA) have higher fees than regular Algos?

No, sending and transacting with an ASA costs no more than sending and transacting with Algos.

There is some indirect cost as the minimum balance required in the account must be higher if it also holds ASAs.  If the account only holds Algos then the minimum balance is 0.1 Algos.  If there are ASAs then the required minimum is: 0.1 Algos times the number of ASA it holds plus one. For example, an Algorand account holding USDT must have a minimum balance of 0.2 Algos.

See https://developer.algorand.org/docs/features/asa/#assets-overview for further information.

What happens with the money that ends up in the fee sink? Who controls it?

At the moment, the Algo wallet receiving Algorand blockchain transaction fees is held by the Algorand Foundation. For the near term, the amount of Algo accumulating in this wallet is and will continue to be modest, based on the 0.001 Algo/transaction fee. Once the daily transaction level reaches a threshold, where the amount of Algo held in the wallet is material, the Foundation will engage with the community on how best these accumulating fees can be leveraged to support the ecosystem. As it currently stands, Algos in a fee sink can only be sent as participation rewards. A consensus upgrade has the possibility to change this should the community elect to do so.

How will you keep transaction fees low and stable in the long term?

The Algorand Foundation has no plans to review the transaction fee levels of the Algorand blockchain currently. As the steward of the Algorand ecosystem, the role of the Foundation would be to facilitate the wider Algorand community and ecosystem making that decision, if there is a proposal to examine that from within the community at any point in the future.

Governance FAQ

All you need to know about Algorand Community Governance

* Sign-up to Algorand Community Governance is done through a Zero Algo transaction ONLY. Please do not send Algo to the Governance escrow account as this will not sign you up as a Governor.  Algo sent in error to the Governance escrow account will be returned after the end of the Governance period.

Requirements

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Who can participate in Community Governance

All Algo holders are invited to become Governors and vote on important decisions regarding ecosystem development.Their votes will depend on the amount of Algos they will commit to governance for a 3 month period.

What is a Governor?

As currently defined, Governors are Algo holders who commit a governance stake for a 3 month governance period and vote as required during the governance period.

Is there a minimum or maximum Algo commitment amount for Community Governance?

There are no thresholds for a minimum or maximum commitment of Algo to Governance. We recommend you please only commit what you are able to commit and what you can comfortably maintain throughout each Governance period.

Is there a minimum/maximum number of governors?

There is no minimum/maximum number of governors. This is an open program. Anyone willing to commit and vote can become governors.

How can I participate in Community Governance?

The Governors will have to commit an amount of Algo for a minimum of 3 months (length of a governing period). Please see our Governors guide for instructions on how to participate in the Community Governance.

Do I need to provide any identification (KYC) to participate in Community Governance?

No, there are no requirements to do so.

Are there any penalties if I withdraw committed Algo from my governing account before the end of the governance period?

Governors who withdraw Algo causing the number of Algo to drop below the committed amount of Algo at any point of time of the relevant governance period will not be entitled to claim the rewards of that governance period.

Will the account be eligible for rewards if I deposit more Algo into the participating account during the governing period?

Yes, it will. Please ensure you maintain your committed balance and ensure you vote during the voting window. Algo deposited after the beginning of a governing period, however, will not provide additional votes nor any additional rewards.

Do I need to setup a node in order to participate in Governance?

No, you do not need to run a node in order to participate in governance.

Mechanics and Wallets

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Does the MyAlgo hack affect my governance status?

If you did not use MyAlgo wallet for governance, there are no actions required.

If you did use MyAlgo, the MyAlgo team has advised all users to either move their funds or rekey their accounts. Whereas moving your funds will make your governance status ineligible, if you rekey your account that will not affect your governance status. It is important to make sure that any transaction cost of the rekey doesn't put the account below the committed amount. 

Please find below a few tutorials to rekey on other wallets:

1) Rekey your wallet to a new wallet on @PeraAlgoWallet app:

https://twitter.com/PeraAlgoWallet/status/1630991666814353410

2) Rekey your wallet on @PeraAlgoWallet web app:

https://twitter.com/PeraAlgoWallet/status/1630284001561681920

3) Rekey your wallet on @deflyapp app:

https://twitter.com/deflyapp/status/1630576504424783872

When is the sign-up period for Community Governance?

Community Governance features quarterly entry points, allowing participants to join the program on a voluntary basis. Please see https://governance.algorand.foundation/ for current and upcoming governance periods.

Will Governors receive email communications related to updates and required actions during the Governance Period?

No, the Algorand Foundation does not know who the governors are and does not have their contact information, so one-to-one email communications is not a viable option.

Updates and actions which need to be taken within each Governance Period will be clearly communicated through the Algorand Foundation website, our community newsletter and on our official social media channels.

Please note integrated wallets (such as AlgoSigner, Pera Wallet, Defly wallet) should provide notifications related to Community Governance and the web portal will also facilitate notifications.

Is everyone who holds Algo tokens automatically signed up to Community Governance?

No, Algo holders are not automatically signed up to Community Governance. Algo holders will need to go to the Governance web portal and declare how many Algo tokens they will commit to each period during the sign up window. To participate, governors will have to sign a transaction to signify their commitment. The Governance web portal can be used to generate a transaction of the right format. A signed transaction to this effect will be required to participate, which you can create via the Governance web portal.

Will rolling over be automatically done for a Governor from the previous period?

No. A Governor will have to explicitly commit to becoming a Governor for each period of governance.

Will I require a new wallet address to participate in Governance?

A Governor can use their existing wallet address to participate in governance, or they can establish a new wallet address specifically for this purpose. It may be the easiest option to create a wallet specifically to manage your governance commitment.

Will participation in governance be available using a Ledger Nano device? Will I be able to stake using my Ledger device?

You can use your Ledger device to participate in Community Governance with any wallet that has Ledger integration with support of a transaction notes field. If using Ledger Live, you will not be able to participate as Ledger Live does not support a transaction notes field.

I have an account with an exchange. Will major exchanges facilitate participation in Community Governance?

With exchanges you do not have your own wallet address. Exchanges will have different policies on how to participate and you will have to check the respective exchange policies for more information.

Can you use a multisig wallet to participate in Governance?

You can use a multisig wallet to participate in Community Governance as long as you maintain your staked balance throughout the period.

I have Exodus tokens, will I be able to participate or do I have to move my Algo?

If you have an Algorand wallet that you control exclusively (Algorand address) you will be able to participate in voting. With an Algorand address you will be able to vote with your Algo balance, you cannot vote with any other asset on the Algorand network.

Do Exchanges receive a vote?

All Algo holders who commit will have a vote. This will include exchanges that hold Algo and participate.

As different exchanges operate differently, it will depend on the respective interactions exchanges have with their Algo holders. We have worked with exchanges and communicated instructions on how to provision governance participation for their customers. Consult your exchange to get more information about how they handle Algorand Community Governance.

Do you recommend a Governors commit all their Algo tokens to Community Governance?

No, we would not recommend committing every Algo token you have to Community Governance. We recommend that you leave at least 1 uncommitted Algo in your wallet. You need to maintain the committed Algo throughout the governance period and ensure you have sufficient Algo tokens in reserve in the participating wallet to cover transaction fees that will be required during the period.

Voting

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How long will the voting period be open for during a Governance period?

Voting periods are generally open for two weeks to give Governors time to review the voting measures and cast their vote. Exact voting window dates will be shared for each period.

Will there be a platform where we can closely evaluate the list of tasks before we vote?

The Algorand Foundation will submit the list of tasks to the Governors every quarter, providing in advance all the available background needed to allow informed decision-making. This will be available on our website and on the Governance web portal.

Is it required or recommended that a person have any specific knowledge or skills to serve as a Governor? I would like to participate, but I'm concerned that issues I would be asked to vote upon will be way over my head.

The type of topics will be wide ranging and we are not looking for all Governors to be familiar with all topics. This is why the delegation of votes is beneficial especially on topics where you are not as familiar.

Will Algorand Foundation itself vote in Community Governance?

The Algorand Foundation will not vote or earn rewards in Community Governance. Its only role will be to set up the voting options and indicate its favorite option. Governors that want to do so will be allowed to opt to endorse automatically the Foundation’s preferred choice, but no Algo controlled by the Foundation will be committed to governance.

Can we choose to take the voting advice of the Foundation?

Yes. Governors can choose if they wish to follow the Foundation’s advice and vote accordingly.

Will the voting options be “Yes”, “No”, “Abstain” or how will the voting options be presented for Community Governance?

We are committed to making Governance as easy and straightforward a process as possible. We expect voting options to be simple such as:

  • Options Yes, No, or Vote with Foundation
  • Option A, Option B, or Vote with Foundation.

There will not be an option to abstain from voting. To maintain eligibility and to claim Governance rewards, each Governor must vote and maintain their committed Algo balance throughout each period.

Please note the web portal will facilitate a checkbox to vote with the Foundation’s recommendations.  

What is the threshold for yes to pass, 51%?

Yes, this is the expectation for simple 2 answer questions. For >2 answer questions, we may examine allowing the highest vote choice to prevail. This is an example of a governance decision that will be first put to the community to decide.

How many votes will be required within a Governance Period?

This can vary by period. The number of voting measures will be shared in advance of the voting window opening in the respective governance period.

Rewards

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What are the requirements to be eligible for Governance Rewards?

Governors MUST maintain their committed Algo balance throughout each full 3-month period. In other words, Governors cannot move the amount of Algo committed in the designated wallet for the entire period. In addition, they must participate in all the votes during that period.

In order to commit Algo as a Governor does one simply need to maintain a certain balance in the Algo Wallet? What is the minimum amount of Algo to be delegated as a Governor?

In terms of a minimum commitment, 1 committed Algo equals 1 vote. Regarding the balance, you need to maintain the balance amount of Algo you committed to the governance period. For example, if you commit 100 Algo to Governance you must maintain at least 100 Algo throughout the Governance period. It is NOT advisable to commit 100% of your Algo balance in the wallet to the governance program, since you will need to use a little of it as transaction fees for the voting transactions. It is recommended to leave at least one Algo uncommitted in the account

How are Community Governance Rewards managed/distributed each governance period?

Governing wallets that participate in the vote and maintain their committed number of Algo for the full governance period will receive their distributed rewards at the end of the relevant governance period. Governors who miss a vote, or fail to maintain their committed number of Algo during any point of time in the relevant governance period, will not be entitled to their rewards for that governance period. Governance reward distribution will be distributed automatically within a week of the period ending.

At the end of the Governance period can I spend/use the rewards earned?

Yes, earned rewards can be utilised as you wish.

Are the rewards you receive at the end of each governance quarter based on the Algo you commit at the start of the quarter or is it subject to change if you add more to your commitment throughout the quarter? Which leads to the question, can you add to your commitment after your initial commitment?

Rewards received will be based on what you commit at the beginning of each Governance period. Your commitment at the beginning of the period is the measure of your commitment to Governance. You can add Algo to your governance account beyond the committed level, but they will not count as governing stake, and you will not receive rewards for them.

Do I need to recommit anew for every Governance period?

Yes.

What is the commitment period which is required to earn Community Governance Rewards?

Governors serve for a 3-month governance period at a time, committing a fixed amount of Algo for this said period. Governors must ensure they participate in all votes and maintain their committed number of Algo for the entire governance period in order to claim their rewards at the end of the governance period.

Why do I need to commit Algo to participate?

Governors have to commit Algo to show they are willing to put skin in the game and align their incentives to those of the community. Additionally, Algorand is a proof-of-stake blockchain and the governance voting power will be proportional to the committed stake in governance. (1 Committed Algo = 1 Vote)

What is the Governance Rewards Rate for each governance period?

The rewards rate will vary per period. This will be determined by the number of committed Algo, and computed as the ratio of the total Algo being committed against the total reward pool for that period, which for now is the amount budgeted for rewards in the Long Term Algo Dynamics page. An overview of examples on how reward rates would be calculated is available here.

How much profit should I expect to make from Community Governance?

The rewards claimed will be proportional to the number of ALGO tokens committed to Community Governance and the rewards pool for each period. We have shared an overview of potential rewards based on levels of Algo commitment here.

During the governance period, are the Algo committed by the Governors locked?

No. However, Governors who fail to maintain the required balance '"committed Algo" at any point of time during the governance period will not be entitled to claim their rewards.

At the end of a quarter, can I choose to not receive the rewards yet?

No. The Governance Rewards due for each period will be automatically delivered into eligible wallets during each Governance rewards distribution period. The Governance Reward distribution will be within a week of the period ending.

Can Governance Rewards earned in a period be committed to the next Governance Period?

As a result of community feedback, we have adjusted the timing of the governance commitment periods to enable Governors to commit Algo inclusive of their governance rewards, distributed at the end of the current period, to the next period. This will be standard practice for all future periods.

xGovs

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Do I need to use GitHub to be able to be an xGov?

No, xGovs need not have a github account, but having one helps in participating in the public discussion on proposals. Proposals for xGov-controlled funding must be posted to github, where they are discussed by the community before being brought to the xGovs to vote on. These discussions are completely public, no github account is needed to view them. However, a github account is needed in order to actively participate in those discussions.

Are there any additional rewards for xGovs?

There are no additional reward amounts added to the xGov Reward Pool beyond what xGovs opt-in themselves. This may change in the future as the programme evolves.

What is the voting power of an xGov and how is it renewed?

The xGov Voting Power (xGVP) is the amount of ALGOs that an xGov has to vote with. If the governance rewards deposited in the xGov Term 1 Pool for Bob was equal to 100 ALGOs. Then, Bob’s xGVP is 100. Bob then needs to use all his voting power during each voting session. The xGVP renews at the start of each session. If Bob deposits 50 more ALGOs in the xGov Term 2 pool (at the end of the next governance period), then his xGVP for subsequent voting sessions becomes 150. If Bob forgets to vote, he will become ineligible and forfeit its ALGOs to the relevant xGov pool(s), losing his xGov status and his xGVP.

Do DeFi xGovs have an advantage over non-DeFi xGovs?

No, xGovs use a strict 1 ALGO = 1 Vote rule, including ALGO from DeFi products. However, DeFi governors may earn extra rewards from regular governance, which can then be committed to xGov pools, giving them a higher xGPV.

What happens to an xGov that has locked their rewards in an xGov pool, if they later become ineligible for general governance in a subsequent period?

If I opt-in as an xGov in GP7 and remain eligible as per xGov eligibility requirements, could I then in GP8, 9, 10, etc choose to not opt-in to the xGov program with further rewards and thus maintain xGov eligibility for GP7 rewards lockup period and also earn General Governance rewards if remaining eligible in those subsequent quarters?

Will xGov voting windows align with General Governance voting windows for UX purposes?

No, these are two separate systems with separate voting requirements and separate UX'es. Since xGov proposals could one day become governance measures, it may be good to create the habit of having xGov voting windows happen before the General Governance voting sessions.

Will xGovs from xGT1 need to abide by any changes in xGov requirements that are introduced after the end of registration? E.g. If it is decided during G7 that xGovs need to run a node besides committing the rewards, will such decisions apply to xGovs from xGT1 as well or just from xGT2 onwards?

Running a node would be an ENTRY requirement, once you are in the program for 12 months, you are there for the whole 12 months, the only thing that can change that is failing to vote on the sessions.

Similarly, if it is decided that more than 1 voting session per quarter is needed for the xGov program, will that apply for xGovs of xGT1 as well or not? In case of the latter, does it mean that for the first 12 months of xGov, there will be at most 4 voting sessions?

The xGov program is nascent, and changes will occur. This process evolution - and how changes are applied to it - will be discussed and voted on by the community, so the process itself remains fair.

Is it a requirement to be an xGov in order to make an ARC 34 proposal?

No. Anyone can make an xGov funding proposal by following the ARC 34 standard and using the template available on the xGov Proposals Repo. Only proposals using the official template are accepted.

What is the xGov proposal process step-by-step, or “life of an ARC 34 xGov proposal” if you will?

We are working on a “how-to” guide and demo video. Coming soon.

How does the xGov Terms (rewards lock-up) work exactly?

What are Term Pools and where do they come from?

A Term Pool is established at the start of each quarter when Governance Rewards are deposited on the Term Pool address and xGov receives their voting power (xGVP). Term pools last for 12 months and each has a different wallet address unique to that pool. Once 12 months have elapsed, all algos in that pool are paid out to the eligible xGov and the Term Pool will close.

How are xGov Term Pools to be separated or are they?

Each xGov Term Pool will have its own address.

Do xGov Term Pool rewards compound?

No. The only way to increase the xGov Voting Power locked is to successfully opt-in to subsequent xGov terms.

How will voting power stack from subsequent governance periods? If next periods receive smaller rewards (as has been the trend), will later xGovs automatically have lower voting power or will each period be weighted/normalized to have the same voting power?

1 ALGO in xGPT = 1 Vote, no weighting applied. To start with, early governors may have a little more voting power due to higher rewards levels, but this will even out over time when early Term Pools are closed and new ways to become an xGov are introduced. The maximum accumulation only lasts 4 quarters, which means the earlier xGVP will be shaved off every quarter after the first 12 months, when the earlier xGTPs start to close.

If I commit in GP7, am I in the same xGov Reward Pool as those that commit to xGov GP9?

Only if you also commit in GP9, otherwise no. Every xGov Term Pool (xGTP) is run separately, so the forfeited ALGOs can be distributed to the correct xGovs at the end of the Term. The xGTP is then closed. If you commit on both GP7 and GP9, only the overlapping GP9 xGVP will be in the same Term Pool (xGTP3).

If I have xGVP in more than one xGTP, do I use it all at once to vote or do I have to vote once per term pool?

You will always use your combined xGVP to vote at any given session. Unless you are using more than one wallet address.

What is an XGovernor?

An XGovernor is a governor that commits their Algo stake for a period of one year or more.

Can I be an xGov without being a governor?

You have to be a governor for the full governance period before you opt-in to become an xGov. Once you are an xGov, you don't have to participate in general governance, unless you want to vote in general governance measures and help decide how much ALGO is allocated to the xGov program, for example.

How will the community have influence over the issues that are voted on during each Governance period?

Yes. The xGov voting measure from the third period of Community Governance passed with 99% support from governors. We will be sharing more information in due course on how this will be facilitated.

I have opted in to become an xGov, can I change my mind?

If the sign-up period that you opted into is still open, you can opt out. Once the sign-up closes, you can't opt out and must carry out your duties in order to claim your rewards deposit at the end of the program.

What are the rights and obligations of XGovernors?

A governor is required to follow the rules of the community to prove its commitment to the Algorand ecosystem for the Governance term.

This gives a governor the right to vote on all proposed measures, and receive rewards at the end of the governance period if the governor has expressed valid votes for all measures, whatever the choice.

Will Governance control what DAO’s, DApp’s, and/or third parties get integrated into the Algoand ecosystem?

The Algorand network is a public, permissionless and decentralized blockchain network and is therefore available for anybody to build on without permission or restriction.

Proposals

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