Approval & Rejection Thresholds
Introduction
Section titled “Introduction”Every proposal in a Privacy Pump vault can end in one of two ways:
- Approved and executed
- Rejected and closed
Most users immediately understand approval thresholds.
For example:
- A 2-of-3 vault requires 2 approvals.
- A 3-of-5 vault requires 3 approvals.
- A 4-of-4 vault requires 4 approvals.
However, many users are surprised to see a separate Rejections column in the Proposals tab.
This page explains how rejection thresholds work and why they are important.
Why Rejections Exist
Section titled “Why Rejections Exist”A proposal should not remain open forever.
If enough members reject a proposal, it becomes mathematically impossible for that proposal to pass.
When this happens, Privacy Pump automatically considers the proposal rejected.
This prevents inactive or failed proposals from remaining open indefinitely.
How Rejection Thresholds Work
Section titled “How Rejection Thresholds Work”Privacy Pump calculates rejection thresholds automatically.
Users only choose the approval threshold when creating a vault.
The rejection threshold is derived from the vault configuration.
Formula:
Rejection Threshold =Total Members − Approval Threshold + 1Example: 2-of-3 Vault
Section titled “Example: 2-of-3 Vault”Configuration:
Members: 3Approval Threshold: 2Proposal Status:
Approvals: 0/2Rejections: 0/2Why 2 rejections?
If two members reject:
RejectedRejectedRemaining member = 1Only one approval is still possible.
The proposal can never reach two approvals.
Therefore the proposal is automatically rejected.
Example: 3-of-5 Vault
Section titled “Example: 3-of-5 Vault”Configuration:
Members: 5Approval Threshold: 3Proposal Status:
Approvals: 0/3Rejections: 0/3Why 3 rejections?
If three members reject:
RejectedRejectedRejectedRemaining members = 2Only two approvals remain possible.
The proposal can never reach three approvals.
Therefore the proposal is automatically rejected.
Example: 2-of-5 Vault
Section titled “Example: 2-of-5 Vault”Configuration:
Members: 5Approval Threshold: 2Proposal Status:
Approvals: 0/2Rejections: 0/4This configuration often surprises users.
Let’s examine it:
1 rejection = still possible2 rejections = still possible3 rejections = still possible4 rejections = proposal cannot passWith four rejections, only one member remains.
The proposal can no longer achieve two approvals.
Therefore:
Rejection Threshold = 4Example: 4-of-4 Vault
Section titled “Example: 4-of-4 Vault”Configuration:
Members: 4Approval Threshold: 4Proposal Status:
Approvals: 0/4Rejections: 0/1This is the strictest vault configuration.
If even one member rejects:
Maximum approvals possible = 3The proposal can never reach four approvals.
Therefore a single rejection permanently rejects the proposal.
Common Vault Configurations
Section titled “Common Vault Configurations”| Vault Type | Approval Threshold | Rejection Threshold |
|---|---|---|
| 1-of-1 | 1 | 1 |
| 2-of-3 | 2 | 2 |
| 2-of-5 | 2 | 4 |
| 3-of-5 | 3 | 3 |
| 4-of-4 | 4 | 1 |
| 5-of-7 | 5 | 3 |
Reading The Proposals Table
Section titled “Reading The Proposals Table”When viewing a proposal, you may see:
Approvals: 1/2Rejections: 0/2This means:
- One additional approval is required for execution.
- Two rejections would permanently reject the proposal.
Another example:
Approvals: 2/3Rejections: 1/3This means:
- One additional approval is required.
- Two more rejections would reject the proposal.
Key Takeaway
Section titled “Key Takeaway”Approval thresholds determine how many members must agree.
Rejection thresholds determine when agreement becomes impossible.
Together, they ensure that proposals are resolved efficiently and that vault governance remains predictable, transparent, and secure.