1. Decision-making model : Indirect Voting

The Tokamak DAO can be defined as a decision-making body that determines the key specifications of Tokamak Network's smart contracts. Specifically, users holding Tokamak Network Tokens (TON) can delegate the tokens to trusted representatives, and these elected representatives form a committee. These committees can then approve or reject proposals for the Tokamak Network ecosystem.

This is a form of indirect voting method in which the voting rights of tokens are delegated to representatives. This process is similar to the methods used by EOS of selecting the top 21 nodes of validators, or representatives in a representative democratic system.

2**. Protocol Upgrades : Soft fork vs Hard fork**

Layer 2 can be seen as one of several decentralized applications (DApps) operating on top of Layer 1 (Ethereum). Specifically, it is the application processes and verifies transactions in a scalable manner. In this respect, the Tokamak network ecosystem can itself be viewed as one huge piece of software (DApp).

All software evolves as the needs of its users change and grow. These “evolutions'' are conducted through a process called an update / upgrade. Accordingly, the Tokamak Network (software)  should also be upgraded according to the timing and needs of its users. The DAO can be considered as the decision-making body for conducting upgrades.

The important point here is why we have chosen to use a complex decision governance mechanism, specifically a DAO, to implement feature updates. It is because unlike other software, it is built on a public blockchain based on consensus.

Unlike other software, blockchains must continually reach a state of consensus. If users don't fully agree, two different versions of the software may exist at the same time. This is called a fork. (Ethereum and Ethereum Classic; Bitcoin and Bitcoin Cash).

There are two types of forks. A Soft fork and a hard fork. Details about the conceptual differences between the two are not covered in this article (reference attached). The key point is that Tokamak Network will utilize a DAO as its governance model for software upgrades. As previously stated, this is a majority vote model, which is more of a soft fork.

As an upgrade method, neither soft forks or hard forks are perfect, each having its own pros and cons. However, the reasons for choosing soft forks as a method of improving the Tokamak protocol are the following:

• Even with a soft fork, a hard fork is not impossible (token snapshots, etc.).
• If ecosystem participants with minority opinions suffer due to the tyranny of the majority, they can leave the ecosystem at any time (Tokens can be sold on the market).
• The token economy design of Tokamak is initially designed for the development team to have a strong influence. Accordingly, the DAO will initially have some characteristics similar to that of a hard fork, but later changes will create a system more similar to that of a soft fork. This will allow Tokamak to take advantage of the benefits of both hard forks and soft forks.

3. Proposals open for decision making

Anyone can create a proposal. The committee then votes on the created proposals.

Proposals have two types, A and B. Type A are proposals related to staking, inflation, and the use of the DAO's tokens (17.5 million TON). Type B is a collection of engineering agendas related to upgrading Tokamak's smart contracts, such as the staking smart contract, and the setting of permissions between these contracts. Group A proposals mainly deal with economic issues, while Group B proposals mainly deal with smart contract systems.

Type A's proposals are expected to be created through the process of forming public opinion in the Tokamak community, and Type B's proposals are expected to be mainly created by the Tokamak development team.