Asgard Game Theory

Many of you may have heard of movies Avengers, Thor, Marvel Ultimate Alliance 3, The Myth of Loki and the Deadly Mistletoe that mentioned Asgard, then you can understand that Asgard is the dwelling place of gods just like Greek Mount Olympus.

In Asgard, every important god had his own palace and the design of these mansions were similar to their own nobility. After this brief introduction, Let’s talk about (3,3) in our platform ‘Asgard DAO’.

(3,3) is the idea that, if everyone cooperates in Asgard DAO, it would generate the greatest gain for everyone.

Currently, there are three actions a user can take with a different effect on the protocol. Staking — most beneficial to the protocol (+2) Bonding — somehow beneficial to the protocol (+1) Selling — detrimental to the protocol (-2) Staking and selling will both cause a price move, while bonding does not (we consider buying ASGARD from the market as a prerequisite of staking, thus causing a price move).

If both actions are beneficial, then the main action that moves price also gets half benefit (+1).

If both actions are contradictory, the bad (selfish) action that moves price gets half benefit (+1), while the good action that moves price gets half of the downside (-1).

If both actions are detrimental, which implies both actions are selling, then both get half of the downside (-1).

Thus, above mentioned two actions, all scenarios of what they could do and the effect on the protocol are shown here:

● If we both stake (3, 3), it is the best thing for both of us and the protocol, both actions get 2+1 points, 3 + 3 = 6

● If one of us stakes and the other one bonds, staker is the good action who moves the price, hence gets 2+1, while bonder still gets 1, 3+1=4

● When one of us sells, the other one stakes, the seller is the bad action that moves the price gets half of the benefits, hence -2+1, while stakes is the good action that moves the price too gets half of the downside: +2–1, -1+1=0

● When one of us sells, the other one bonds, seller is the bad action that moves the price gets half of the benefits, hence -2+1, while bonder doesn’t move the price still gets 1, -1+1=0

● When we both sell, both move the prices and get the downside, creating the worst outcome for both of us and the protocol, (-3–3 = -6)

Don’t read too hard into the numbers. It simply means to demonstrate the framework created by cooperation. Actual dynamics will strengthen or weaken depending on many factors as well. But it doesn’t change the idea that the best strategies are all cooperative.

Power of Internal cooperation is amplified even more in digital economy.

In terms of materials economy, what is being produced is tangible, limited supply goods. Price coordination (supply/demand) determines the optimal distribution of these goods.

But in digital economy, supply and demand cannot determine the optimal distribution of what is being produced, because what is being produced are ideas, information, and infrastructures, which do not have limited supply in the same way.

Price is only one kind of idea, information, and infrastructure, and not necessarily the most predictive or determinate motivating factor. And therefore internal coordination is more important than price coordination in digital economy.

It is only when a certain threshold of team coordination is reached that the economic productivity of ideas is then externalized into price coordination of Asgard DAO.