Union is built using the Cosmos SDK, a mature blockchain framework that comes with a well-established governance system. This governance model has been battle-tested across numerous blockchain networks and operates through an elegant delegation-based mechanism.
In the Cosmos governance model, any token holder can create proposals by posting a deposit, which serves as a spam prevention mechanism. Though the real power of the system lies in its delegation structure, where token holders stake their tokens to validators who then vote on proposals using their total delegated weight. This creates an interesting dynamic where validators accumulate voting power through community trust, but individual delegators retain the ability to override their validator's vote for their specific portion of the delegation.
The system also includes a special governance account with elevated privileges that can only act through successful governance proposals. This account has the power to execute chain upgrades, modify protocol parameters, manage treasury funds, and add new functionality to the network. All critical protocol decisions must flow through this governance process, ensuring decentralized control over the network's evolution.
Security is maintained through an unbonding period, typically 21 days, during which staked tokens remain subject to slashing if validators misbehave. This mechanism ensures that network security is preserved even as participants enter and exit staking positions.
Union is a systems chain focused on interoperability infrastructure rather than native DeFi applications. This choice reflects Union's strategy of not competing with its ecosystem partners but instead providing the foundational infrastructure that connects different blockchain networks. As a systems chain, Union's core value lies in facilitating seamless crosschain operations, and this philosophy extends to its approach to token distribution and governance participation. Rather than forcing users to operate solely within the Cosmos ecosystem for governance participation, Union's staking and governance model is deliberately adaptive, designed to leverage the strengths of the most suitable blockchain environments.
Union has therefore made the strategic decision to distribute its token as an ERC-20 token on Ethereum, capitalizing on Ethereum's unique advantages: a censorship-resistant foundation with unparalleled liquidity depth, sophisticated market-making infrastructure and a battle-tested economic security model that makes it the ideal environment for token distribution and management.
Furthermore, the Ethereum ecosystem offers a significantly more mature environment for token operations. Multisig solutions like Safe provide sophisticated transaction simulation and management capabilities that simply don't exist in the Cosmos ecosystem. Hardware wallet integration is seamless without requiring custom node configurations, and the smart contract infrastructure for vesting, airdrops, and token distribution is far more advanced and proven in production.
From an exchange perspective, ERC-20 tokens enjoy universal support across all major centralized exchanges, with streamlined listing processes and established custody solutions. This reduces friction for both retail and institutional adoption. The airdrop process itself becomes dramatically simpler when conducted on Ethereum, leveraging existing tooling that has been refined through years of use across hundreds of projects.
Perhaps most importantly, users benefit from familiar interfaces and workflows. Rather than forcing participants to learn Cosmos-specific tooling, they can leverage wallets and interfaces they already understand, reducing barriers to participation and enabling immediate integration with existing DeFi strategies.
This strategic decision creates a fundamental architectural challenge that goes to the heart of how blockchain governance systems work. The Cosmos SDK expects governance participants to hold native tokens on the Cosmos chain, staked through validator delegation. Meanwhile, Union's users hold ERC-20 tokens on Ethereum, operating in a completely different ecosystem with different wallets, interfaces, and infrastructure.
The traditional solution would force users through a cumbersome process: bridge their ERC-20 tokens back to the Union chain, learn Cosmos-specific wallets and interfaces, manually stake using unfamiliar tooling, and remain locked into the Cosmos ecosystem for the duration of their participation. This approach completely negates the benefits of ERC-20 distribution and creates exactly the kind of poor user experience that Union sought to avoid.
The problem runs deeper than mere inconvenience. When users manually bridge and stake on Cosmos, their staking position becomes tied to their specific wallet address on that chain. They lose access to Ethereum's sophisticated DeFi ecosystem, cannot leverage their staking position in other protocols, and must use less mature tooling for any institutional or multisig requirements. Every reward claim requires a manual transaction on the Cosmos chain, and users face a stark choice between governance participation and DeFi utilization.