Once a Clan elects to start an Alliance, the Clan treasury is given 100 governance tokens that represent ownership in the Alliance DAO. These governance tokens represent what fraction of the prizes / bonuses each Clan receives as part of the Alliance events. For example:
Clan A with 60 tokens will receive 60% of the prize/bonus allocation, and Clan B with 40 tokens will receive 40%
Clans use these governance tokens to recruit other clans into their Alliance. These governance tokens are on-chain and can be transferred, bought, or sold. These Alliance Sub-DAOs are ephemeral, meaning that they can disband at any time.
There is no limit to the number of Clans that an Alliance can have. A Clan can also be in multiple Alliances, and receive prizes/bonuses based on their DAO ownership in multiple Alliances; however, a Clan can contribute event points only towards one Alliance that they select before the start of a World Event. For example:
If Clan B owns 50% of Alliance DAO tokens in Alliance 1, and 10% of the tokens in Alliance 2, that clan has to pick which of the two Alliances its points will count towards, even though it can receive its share of the final prizes/bonuses from both.