(3,3) — a positive-sum game

We often hear people talking about “ponzi schemes”. What needs to be understood, however, is that a ponzi scheme is a type of negative-sum game. But, there are other types of games in traditional financial markets. So, what is a negative-sum game? Well, let’s say Holy buys a stock on an exchange that is not experiencing any new inflows of funds. So, what will happen? First, he most likely pays a transaction fee to his broker, and then pays a transaction fee to the exchange. If the trade loses money, then, at least he won’t have to also pay anything to the tax man. But, if he does turn a profit (but, in a market with no increasing volume, that is unlikely), then, after all of the fees, commissions, and taxes, it is likely that Holy will still end up with a loss, overall.

So, why does it work like this? Well, it’s because the rules are too rigid, and because the money coming in is the same as the money going out, or even less. Plus, there are so many blood suckers along the way sucking out your profits so that you’re basically guaranteed from the start that you will lose. The only winners in this type of game are the blood suckers along the way. Unfortunately, most people don’t even realize that they are playing in a negative-sum game because they have been told over and over that theses traditional markets are the path to riches and because they are too busy trying to edge out the guy next to them that they don’t notice all of the blood suckers slowly sucking them dry along the way. So, it’s not always easy to spot a negative-sum game, but we can definitely say that traditional financial markets are full of them. Luckily, more and more money is now flowing out of traditional financial markets and into crypto.

So, given all of that, a “zero-sum game” would seem to be an utopian idea, and it really is. A market where the inflows and outflows don’t change, and where everyone is just trying to pick the pockets of the guy next to him. So, who usually wins in a zero-sum game? Well, it’s the one with the best view of the market or the one who is able to move the fastest. But, you never know if you will make it in one piece to the end. So, this is where money managers try to come in. They can help you maneuver through the game, advising you when to make a move, when to buy or sell. But, they charge a fee for their services. So, we are back to a negative-sum game again. So, it’s not eutopia, after all. You’re just playing in someone’s backyard that has been dressed up to make you think you are in utopia.

So, how about a positive sum game? Well, the hardest part is just being able to find an actual positive-sum game. But, crypto is definitely one because of the constant new inflows of money. Unfortunately, most people just end up back inside zero-sum games or negative-sum games within the crypto world. A true positive-sum game shouldn’t require you to do anything. You just need to find them, and then stay in them…that should be enough.

You’re probably thinking to yourself that Bitcoin has already risen many fold, so we’ve already missed the boat on that one. That’s probably true. That’s because you were spending that time caught up in the zero-sum games and negative-sum games. Or, maybe you just discovered positive-sum games too late. But, that doesn’t matter now. Positive sum games are going to be more readily available and larger going forward. The key will be to maintain your proportional holdings within them and then you will come out a winner. Unfortunately, most people won’t actually do that.

Most people still try to play pricing wars, trying to buy low and sell high, but ending up buying high and selling low. Getting into that kind of game knocks you right back out of the positive-sum game again. That kind of gameplay doesn’t even make sense with a (3,3) model, because it’s already a positive-sum game. It is designed to maintain your portion of the pie over time. It allows the loyal people to grow their holdings as the whole system grows by inflation or grows in value. The platform has its own income streams, it has its own currency and bonds. It’s just like a small bank, right? And you are essentially one of its shareholders. All you need to do is sit back and wait as the assets rise in value and as the market cap inflates. That is how current economic models work, by inflation, right?

So, once you stake, not only is your proportion maintained within the whole, but, as a member of the DAO, you have management rights within the protocol. So, please join in with everyone in managing this bank we have, to make it bigger and better for everyone! And, this is not a zero-sum game where you are wasting your time, or a negative-sum game where everyone is getting hacked. Here we have a positive inflow of funds, and everyone here is profiting alongside you. All you need to do is to ensure that you maintain your proportion within the system. That’s the key to winning this game!

So, hopefully it is clear now that the best way to win is to actually find a positive-sum game, and then stay there!

Author: Holy, Freddy