diff --git a/Gopkg.lock b/Gopkg.lock
index 1f84dd35c..c6090bf27 100644
--- a/Gopkg.lock
+++ b/Gopkg.lock
@@ -452,7 +452,7 @@
   version = "v0.12.0"
 
 [[projects]]
-  digest = "1:23c49a2a0f3f8a8258982bbb1567d60d74253c18a454dbe4189126f7e94834e6"
+  digest = "1:f94f468c7cd1fc3693ebc16011f26ec26538761cdcd182b3a28faa649a7d55e2"
   name = "github.com/tendermint/tendermint"
   packages = [
     "abci/client",
@@ -517,7 +517,7 @@
     "version",
   ]
   pruneopts = "UT"
-  revision = "v0.27.0"
+  revision = "v0.27.3"
 
 [[projects]]
   digest = "1:a7485b2a69f996923f9d3406a9a853fd8eb31818515e985a830d71f88f6a925b"
@@ -695,6 +695,7 @@
     "github.com/tendermint/tendermint/crypto/secp256k1",
     "github.com/tendermint/tendermint/crypto/tmhash",
     "github.com/tendermint/tendermint/crypto/xsalsa20symmetric",
+    "github.com/tendermint/tendermint/libs/autofile",
     "github.com/tendermint/tendermint/libs/bech32",
     "github.com/tendermint/tendermint/libs/cli",
     "github.com/tendermint/tendermint/libs/cli/flags",
diff --git a/Gopkg.toml b/Gopkg.toml
index 108238c4b..d730f62a1 100644
--- a/Gopkg.toml
+++ b/Gopkg.toml
@@ -40,7 +40,7 @@
 
 [[override]]
   name = "github.com/tendermint/tendermint"
-  revision = "v0.27.0"
+  revision = "v0.27.3"
 
 [[constraint]]
   name = "github.com/zondax/ledger-cosmos-go"
diff --git a/cmd/gaia/app/sim_test.go b/cmd/gaia/app/sim_test.go
index b4504bdf8..6b89fc16d 100644
--- a/cmd/gaia/app/sim_test.go
+++ b/cmd/gaia/app/sim_test.go
@@ -87,9 +87,8 @@ func appStateFn(r *rand.Rand, accs []simulation.Account) json.RawMessage {
 			VotingPeriod: vp,
 		},
 		TallyParams: gov.TallyParams{
-			Threshold:         sdk.NewDecWithPrec(5, 1),
-			Veto:              sdk.NewDecWithPrec(334, 3),
-			GovernancePenalty: sdk.NewDecWithPrec(1, 2),
+			Threshold: sdk.NewDecWithPrec(5, 1),
+			Veto:      sdk.NewDecWithPrec(334, 3),
 		},
 	}
 	fmt.Printf("Selected randomly generated governance parameters:\n\t%+v\n", govGenesis)
diff --git a/x/gov/genesis.go b/x/gov/genesis.go
index 7a8fab0b6..750d3a0d8 100644
--- a/x/gov/genesis.go
+++ b/x/gov/genesis.go
@@ -52,10 +52,9 @@ func DefaultGenesisState() GenesisState {
 			VotingPeriod: time.Duration(172800) * time.Second,
 		},
 		TallyParams: TallyParams{
-			Quorum:            sdk.NewDecWithPrec(334, 3),
-			Threshold:         sdk.NewDecWithPrec(5, 1),
-			Veto:              sdk.NewDecWithPrec(334, 3),
-			GovernancePenalty: sdk.NewDecWithPrec(1, 2),
+			Quorum:    sdk.NewDecWithPrec(334, 3),
+			Threshold: sdk.NewDecWithPrec(5, 1),
+			Veto:      sdk.NewDecWithPrec(334, 3),
 		},
 	}
 }
@@ -74,12 +73,6 @@ func ValidateGenesis(data GenesisState) error {
 			veto.String())
 	}
 
-	govPenalty := data.TallyParams.GovernancePenalty
-	if govPenalty.IsNegative() || govPenalty.GT(sdk.OneDec()) {
-		return fmt.Errorf("Governance vote veto threshold should be positive and less or equal to one, is %s",
-			govPenalty.String())
-	}
-
 	if data.DepositParams.MaxDepositPeriod > data.VotingParams.VotingPeriod {
 		return fmt.Errorf("Governance deposit period should be less than or equal to the voting period (%ds), is %ds",
 			data.VotingParams.VotingPeriod, data.DepositParams.MaxDepositPeriod)
diff --git a/x/gov/params.go b/x/gov/params.go
index 01da184d5..955fbd2c9 100644
--- a/x/gov/params.go
+++ b/x/gov/params.go
@@ -14,10 +14,9 @@ type DepositParams struct {
 
 // Param around Tallying votes in governance
 type TallyParams struct {
-	Quorum            sdk.Dec `json:"quorum"`             //  Minimum percentage of total stake needed to vote for a result to be considered valid
-	Threshold         sdk.Dec `json:"threshold"`          //  Minimum propotion of Yes votes for proposal to pass. Initial value: 0.5
-	Veto              sdk.Dec `json:"veto"`               //  Minimum value of Veto votes to Total votes ratio for proposal to be vetoed. Initial value: 1/3
-	GovernancePenalty sdk.Dec `json:"governance_penalty"` //  Penalty if validator does not vote
+	Quorum    sdk.Dec `json:"quorum"`    //  Minimum percentage of total stake needed to vote for a result to be considered valid
+	Threshold sdk.Dec `json:"threshold"` //  Minimum propotion of Yes votes for proposal to pass. Initial value: 0.5
+	Veto      sdk.Dec `json:"veto"`      //  Minimum value of Veto votes to Total votes ratio for proposal to be vetoed. Initial value: 1/3
 }
 
 // Param around Voting in governance