Governance and Treasury

A core principle of Play AI is decentralized governance – we want the community of token holders to have a meaningful say in the project’s direction, especially regarding the large token reserves in the treasury. This section outlines how the Treasury (which holds about 63% of total tokens) is managed, what governance structures we are implementing, and what lock-ups and restrictions we publicly commit to for transparency and trust.

Treasury Composition: As detailed in Tokenomics, the on-chain treasury in Play AI consists primarily of the Community pool (35% of total supply, 1 050 000 000 ZINO) and the Ecosystem pool (28%, 840 000 000 ZINO), together holding 63% of all ZINO. These tokens are not a team reserve; they are locked in multi-signature and DAO-controlled smart contracts and are released gradually according to predefined vesting schedules. Community tokens are streamed to users as rewards for training agents, providing data and liquidity, and participating in governance, while Ecosystem tokens are earmarked for partnerships, grants, liquidity support, and long-term product development. The goal of this structure is to keep the majority of the supply under transparent, programmatic control that can only be deployed for actions that demonstrably grow the network.

The Community Rewards pool will be emitted gradually as users earn them (likely via an automated contract that, say, releases X tokens per block or per day for rewards).

The Ecosystem pool will be locked in a multi-signature wallet or vesting contract where the team (or foundation) cannot unilaterally withdraw large amounts without triggering governance.

Governance Structure: We plan to establish a DAO (Decentralized Autonomous Organization) to govern key decisions. The DAO will be essentially the community of token holders using their tokens to vote. However, we recognize that in the very early phase of the project, fully on-chain governance might be premature (as concentration of tokens could be high among initial investors/team and community is still growing). So we envision a progressive decentralization approach:

Phase 1 (Launch to Beta): The core team and perhaps a small council of trusted advisors manage day-to-day decisions. The treasury tokens are mostly locked, and any spending is minimal and reported. During this phase, we set up the legal entity (likely a non-profit foundation or similar in a friendly jurisdiction like Switzerland, Singapore, or the BVI) that formally holds these tokens on behalf of the project. The foundation’s charter will state that these assets are to be used as per the whitepaper guidelines.

Phase 2 (Initial DAO – Semi-Decentralized): Within, say, 6-12 months of launch (once token distribution is wider), we will form an initial DAO. This could be done via a governance contract or off-chain voting (Snapshot) with on-chain execution via a multi-sig. For example, we might set a rule that any spending from the Ecosystem Fund above the monthly allowance requires a DAO proposal and 51% approval. The multi-sig controlling the funds could be say 5-of-9 signers, where some signers are team and some respected community-elected members. This ensures that neither the team alone nor any single entity can move funds without consensus.

Phase 3 (Full Decentralized Governance): As the project matures and the token is widely decentralized, we aim for a fully on-chain governance system. In this model, major changes or fund deployments are decided by token vote and executed automatically. We might introduce a Governance token separate from utility or simply use ZINO for both utility and voting (most likely the latter for simplicity, as AGIX or others do). A possible structure is:

Any token holder can make a proposal by staking a certain amount of tokens (to prevent spam).

There’s a discussion period (on forums) and then an on-chain vote.

If a proposal passes (we might require a quorum, e.g. at least 10% of tokens voted, and perhaps a supermajority for very critical changes), then the smart contract carrying the proposal’s action is executed. This could transfer tokens from treasury for a specific purpose or change a parameter in the protocol.

We will likely form specific working groups or sub-committees via governance – e.g., a “Grant Committee” that reviews developer grant applications and has a budget allocated by the DAO, or a “Risk Committee” that oversees any economic changes.

We’ll also incorporate Ethical AI guidelines into governance. As noted in our vision, we care about AI being used for good. So one governance aspect might be an Ethics Council or some mechanism to enforce that agents operate within agreed norms. This would be an innovative part of our governance where the community can vote on certain boundaries (for example, if someone wanted to train an agent for a violent or malicious purpose using our platform, the DAO could technically have a policy to disallow funding or support for that, ensuring alignment with human values ).

Treasury Management Policies: We publicly commit to the following restrictions and procedures for treasury management:

Transparency: All transactions from the treasury wallets will be made public (the wallets will be known addresses). We will regularly publish treasury reports summarizing how tokens have been allocated or spent (e.g., quarterly).

Lock-ups: The treasury tokens are vesting over 60 months as mentioned. We will not accelerate this vesting arbitrarily. If there’s ever a consideration to change the vesting (for example, to slow it down to be even longer), that would go through governance. But making it faster would break trust, so we’re effectively locked into a 5-year gradual release. This means the treasury couldn’t dump, say, 30% of tokens in year 1 even if it wanted to – it simply won’t have them unlocked.

Use Cases Only: Treasury tokens will only be used for legitimate ecosystem-building activities. We will outline acceptable categories like: liquidity provision, marketing campaigns (airdrop or partnership), development grants, exchange listings (sometimes exchanges require a token allocation or fee for listing – if so it’ll come from this pool), or emergency fund (like covering a hack or shortfall, hopefully never needed). The community will have visibility into these. Under no circumstances will treasury funds be used to enrich insiders beyond what’s allocated (i.e., we won’t suddenly pay a bonus to team from treasury; team allocation is separate and fixed).

Sell Discipline: If and when the foundation or DAO needs to convert tokens to operational funds (fiat) to pay salaries or expenses, we will do so carefully to avoid market shocks. This could mean selling small amounts on a schedule or OTC deals with partners who want tokens (so it doesn’t hit public markets). We’ll announce large moves ahead of time as well. Essentially, we don’t want the community to be surprised by treasury movements.

Voting Power of Treasury: One important note: the tokens in the treasury ideally do not vote in governance while they are in control of the foundation/team (to avoid the team using them to outvote the community). We will likely exclude treasury-held tokens from vote counting. Later, as they get allocated to actual community or partners, those new holders can vote with them. This ensures governance isn’t just dominated by what is technically a big chunk of tokens that are not circulating.

Emergency Safeguards: In early phases, we might have an emergency multi-sig that can pause certain operations if something goes wrong (like a bug causing tokens to release incorrectly). This would be a time-locked pause and would require community review. We mention this to be transparent – user funds and most tokens are safe by design, but having a kill-switch for a narrowly defined emergency can be wise. However, that itself will be governed (for example, an emergency action might require 7/9 multi-sig including at least some non-team members).

Decision-Making Procedures: For normal proposals (non-emergency), the process would be:

Proposal Creation: A forum (governance portal) where anyone can propose an idea. If it gains traction (through discussion and maybe informal signaling votes), it moves to formal proposal.

Voting: Voting could be done over, say, a 5-7 day window for each proposal. Longer if it’s a major change. We might start with off-chain voting (Snapshot) to make it easy (Snapshot can verify holdings at a certain block without gas fees).

Execution: If passed, either the multi-sig executes the approved action (in a transitional DAO) or the smart contract automatically does (in a fully on-chain DAO phase).

Quorum & Supermajority: We likely will require at least a minimal turnout to avoid a tiny group making decisions. For fundamental issues (like altering token economics or adding new token minting – which we currently don’t plan to allow at all – or contract upgrades), we might require maybe a supermajority (e.g., 60-70%) to agree and a higher quorum. Simpler issues (like approving a grant) might just need >50% yes and a reasonable quorum.

Off-Chain integration: Not every decision can be on-chain (for example, deciding to initiate a marketing campaign isn’t a blockchain action per se). For those, a passed proposal is essentially a directive to the team/foundation to carry it out. We commit to honoring governance decisions; over time as trust shifts fully to community, the team’s role transitions to just implementers of the community’s will.

Legal Structure for Governance: We are aware of regulatory considerations. Often projects set up a foundation or a DAO LLC to manage treasury legally. We will likely incorporate such an entity in a crypto-friendly jurisdiction with clear bylaws that the entity will act according to token holder votes. This gives a legal bridging – so when token holders vote to spend X tokens on Y initiative, the foundation’s board (which could initially be team members) is legally obliged (and willing) to execute it. This structure also helps with accountability and protecting team from liability (by having an entity). As part of our legal approach (next section covers jurisdiction etc.), we’ll ensure our governance doesn’t inadvertently make the token a security. By keeping it clearly a utility and governance token and not promising profits, we stay on safer side.

In conclusion, the treasury is in place to future-proof the project and empower the community. Our governance approach aims to gradually hand over the reins to the community in a sensible way. We commit to lock-ups and transparency that hold us accountable. Ultimately, as the project reaches a steady state, the community (via the DAO) will decide how to utilize that large treasury – be it to expand to new markets, to initiate a token burn, or to fund new research. We’re excited to see Play AI evolve into a truly decentralized organization, setting a standard for how AI projects can be governed in an open manner.