Question 1

What is GNO?

Accepted Answer

GNO is the governance and staking token of the Gnosis ecosystem: GNO holders can participate in GnosisDAO governance and use it in Gnosis Chain’s proof-of-stake security mechanism. It is not the asset used by default to pay gas fees for ordinary transfers and contract calls on Gnosis Chain. Therefore, when understanding GNO, “governance and network-security stake” must be separated from “on-chain operating costs”: GNO primarily serves the former, while xDai serves the latter. The two assets serve different parts of the same ecosystem, and holding GNO does not itself replace the xDai needed for on-chain transactions.

Question 2

What can holding GNO do?

Accepted Answer

GNO holders can influence protocol- and treasury-related decisions through GnosisDAO’s governance process. Voting power is weighted by the amount of GNO; holders may participate directly or delegate their voting power to another address, which represents the corresponding weight in the governance process. The significance of governance is not that the token automatically produces a fixed return, but that token weight can participate in proposals and voting. The effect of a vote depends on the rules of the specific GIP, the voting result, and subsequent execution, rather than every holder automatically receiving funds or services merely by holding the token.

Question 3

How is GNO staking related to network security?

Accepted Answer

GNO can be used for PoS staking on Gnosis Chain, thereby tying economic cost to the responsibility of validating network state. Validators participate in validating blocks and transactions; the network uses staked assets as a constraint, so malicious behavior or failure to fulfill responsibilities under the rules is not merely a technical issue and may also have staking-related consequences. Staking does not use GNO as transaction fuel. It serves consensus security: greater compliant validator participation helps the network maintain validation and block production, while stakers or users of delegated services must separately review rules on reward distribution, availability, exit, and possible slashing.

Question 4

Can GNO be used to pay Gnosis Chain fees?

Accepted Answer

No. Gnosis Chain uses a dual-token arrangement: xDai is used to pay transaction and gas fees, while GNO is used for staking, protocol security, and DAO governance. Whether an on-chain operation can be executed depends on whether the initiating address has sufficient xDai to pay the operation’s fee, not on whether it holds GNO. This distinction also affects asset preparation: focus on GNO when preparing to participate in governance or staking; when preparing to transfer on Gnosis Chain, call contracts, or use applications, also consider xDai and the actual fee consumed by the operation.

Question 5

How is GNO’s supply set?

Accepted Answer

GNO has a governance-defined target total supply of 3,000,000 tokens. This figure comes from GIP-35 and is a governance-defined target supply basis; it should not be directly understood as the freely tradable circulating supply at a given time. The supply basis must also be understood in conjunction with governance actions: GnosisDAO later authorized the burning of some tokens. Burning reduces the number of tokens represented by the burned portion, but the target total supply alone cannot be used to infer the real-time circulating supply, an individual’s holding share, or staking returns.

Question 6

What risks should be considered when using or staking GNO?

Accepted Answer

When using or staking GNO, first distinguish market risk, protocol-participation risk, and operational risk. GNO’s market price can be affected by buying and selling supply and demand as well as ecosystem and governance expectations; this is related to its validation and governance functions, but those functions do not automatically produce a price or return outcome. Staking also requires attention to the participation route. Running independently or participating directly entails corresponding operational and rule-compliance responsibilities; participating through a third party or by delegation adds differences involving the service provider, reward distribution, and asset-control arrangements. Regardless of the method used, confirm the network, address, and specific exit rules.

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