What are Governance Tokens?

 governance tokens convey certain privileges, including: Rights to cash flow: Protocols may charge a fee to their users. These fees are collected, and a governance vote can decide to distribute a portion of fees to token holders, akin to dividends with equities.

What is snapshot?

Snapshot is a decentralized voting system. It provides flexibility on how voting power is calculated for a vote. Snapshot supports various voting types to cater to the needs of organizations. Creating proposals and voting on Snapshot is user-friendly and does not cost gas as the process is performed off-chain.

In short, Snapshot is an off-chain gasless multi-governance client with easy to verify and hard to contest results.

What are the main benafits of Snapshot?

• Free (gasless) to create proposals and vote on them
• Votes are signed messages easily verifiable online
• Multiple voting systems - Single choice, Approval voting, Quadratic voting, and more
• Flexible voting strategies to calculate voting results - vote with ERC20s, NFTs, other contracts, and more
• Spaces can have their branding with custom color schemes and domain name
• Fully open-source with MIT license

Methodology

We are looking to see how active snapshot is and how users are using the protocol. To understand this we will visualize the following metrics:

• Weekly Snapshot Votes, Voters, and Proposals
• Top Snapshot proposals
• Top smartcontracts used by Snapshot Voters
• Voters by activity cohorts
• Votes by vote type

Observations

• Overall, there has been 952K wallets voting 5.6 Million times on 52K governance proposals using Snapshot.
• In November 2021 there was a big spike in the use of the Snapshot protocol.
• Since the increases in activity In Novmer 2021 the increase has persisted and Snapshot has continued to have a lot of use.

Observations

• Only a small number of Governance votes on snapshot have over 20K Users interacting with the Vote.
• Starting in October 2021 the number of users interacting with Proposals increased and many proposals with over 5,000 Votters started appeaing.
• The Arbitrum Odyssey Proposals have been some of the most popular on Snapshot.

Observations

• Not many snapshot address are interacting with Ethereum Smart contracts, but the ones who are are mostly interacting with WETH and stablecoin contracts
• 88.8% of Snapshot voters have voted less than 5 times on Snashot
• less than 0.2% of snapshot users have voted over 100 times.

Observations

• The median and mode proposal on Snapshot last for 3 days
• there are about 100 proposals on Snapshot that have lasted for over 100 days.

Conclusion

Only a small number of Governance votes on snapshot have over 20K Users interacting with the Vote. Not many snapshot addresses are interacting with Ethereum Smart contracts, but the ones who are mostly interacting with WETH and stablecoin contracts. 88.8% of Snapshot voters have voted less than 5 times on Snapshot. When it comes to what votes, users, about 3/4 of them are affirmative of a proposal. Overall Snapshot has gained a large amount of Activity in November 2021 this activity has persisted to the current day and continues to increase despite the bear market.

Observations

• 77% of votes on Snapshow are votes in the affirmative
• There is a similar number of No and Abstain votes on Snapshot
• On the week of April 11th there was a spike in No and Abstain votes.