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Forbes
23-07-2025
- Business
- Forbes
Game Theory In Blockchain: The Invisible Hand Of Decentralized Trust
Ali Faizan Rizvi | Chief Commercial Officer | Mint Gateway. Ever wonder how nodes are incentivized in a blockchain to ensure trust, consensus and cooperation in a system with no central authority? The answer lies in game theory, the mathematical study of strategic interactions among rational agents. In the decentralized blockchain world, where participants act independently and often from self-interest, game theory provides a structured framework for designing protocols that align individual incentives with collective goals. As a business development leader with two decades in fintech strategy and a strong advocate for blockchain's potential, I've been actively working toward building decentralized ancillary ecosystems and exploring token economics for digital banking platforms. My experience in M&A has shown how incentive alignment and behavioral economics often define outcomes. Whether in finance or any trust-driven industry, game-theoretic thinking has constantly proven its value. In this piece, I'll highlight how principles of game theory play an instrumental role in driving adoption, building trust, aligning incentives and scaling value across decentralized ecosystems. Introduction To Game Theory Game theory models how individuals or groups make decisions in a situation where the outcome is impacted not just by their own actions but by others' actions as well. It analyzes strategic interactions among decision makers, often referred to as "players," each of whom selects from a set of strategies to maximize their payoff. A key objective in game theory is to identify equilibrium outcomes, particularly the Nash equilibrium, where no player can benefit by unilaterally changing their strategy. The discipline was formalized by John von Neumann and Oskar Morgenstern in 1944 in their seminal work, Theory of Games and Economic Behavior, and has since been applied extensively in economics, military strategy and now, decentralized technologies such as blockchain. In blockchain, game theory underpins the logic of trustless interactions. Without centralized enforcement, protocols rely on economic incentives to promote honest behavior, making deviations either economically infeasible or less attractive. This aligns with the principles of mechanism design, a subfield of game theory that involves structuring systems such that rational participants naturally choose to behave desirably. Why Game Theory Matters In Blockchain Unlike traditional centralized systems, blockchain networks comprise numerous independent and often anonymous participants—miners, validators, developers, users and more. Each actor is expected to behave in a way that benefits the network, and game theory ensures that their incentives align with the system's integrity. Without a governing authority, the risk of fraud, manipulation or network failure is high. Game theory ensures cooperation is the most profitable strategy, making dishonest behavior suboptimal in most scenarios. Game Theory Applications In Blockchain • Proof-Of-Work (PoW): Introduced by Satoshi Nakamoto, Bitcoin's PoW mechanism rewards miners who solve complex cryptographic puzzles, thereby securing the network. Game theory ensures that it's more profitable to play by the rules than to attack the system. • Proof-Of-Stake (PoS): In Ethereum 2.0 and similar blockchains, validators stake tokens to earn the right to propose and validate blocks. If a validator behaves maliciously, their stake is slashed. Rational participants are thus economically deterred from misbehaving. • 51% Attack Defense: As of July 17, 2025, estimates that a one-hour 51% attack on Bitcoin (PoW) would cost approximately $2.6 million, up from earlier figures due to rising network hash rates and energy costs. For PoW-based chains like Ethereum Classic, the price cost is far lower (approximately $10,489 per hour), exposing them to greater vulnerability. Game theory explains why 51% of attacks are rare despite being technically possible. In PoW, rational miners avoid attacks as they would devalue their own holdings and future rewards, making honest mining the most profitable strategy. In PoS systems like Ethereum 2.0, the cost of an attack is not computational but capital-based. Validators risk losing their staked assets and reputation, making honesty the dominant strategy. • Bitcoin, Nash Equilibrium: Bitcoin's mining mechanism operates on a Nash equilibrium, where miners are incentivized to follow the rules since deviation reduces rewards and destabilizes the network. • Ethereum 2.0, Slashing As A Deterrent: Validators proposing conflicting blocks are penalized. Game-theoretic design ensures dishonest behavior leads to greater loss than potential gain. • Decentralized Autonomous Organizations (DAOs), Voting Behavior: DAOs use token-weighted voting, where rational participants align votes with financial interests. However, risks like collusion and voter apathy remain active areas of game-theoretic study. Challenges And Limitations Despite its power, game theory assumes rationality, which may not always hold. Actors may be influenced by emotion or misinformation, collude or form cartels, misunderstand incentives or lack information. Moreover, real-world scenarios often have too many variables to be modeled precisely, creating gaps between theoretical predictions and actual behavior. A March 2024 study, analyzing over 16,000 DAOs and 122,000 proposals across nine blockchains, revealed systemic vulnerabilities in DAO governance. Over 60% of proposals lacked consistency between code and explanation, undermining transparency and trust. These weaknesses underscore the importance of game theory in DAO design. Properly applied game-theoretic mechanisms, such as transparent proposal structures, slashing for dishonest actors and incentive-aligned voting, ensure integrity and prevent exploitation in DAO ecosystems. Future Outlook Game theory will remain central to blockchain's evolution, be it shaping AI-driven incentive models, cross-chain strategies or decentralized governance frameworks. As decentralized finance (DeFi), NFTs, DAOs and central bank digital currencies (CBDCs) expand, game theory will underpin the architecture of trust and cooperation across diverse digital ecosystems. In blockchain, code may be law, but game theory is the judge. It transforms trustless environments into robust ecosystems by designing incentives that reward honesty and punish misconduct. As we shape the future of decentralized finance, identity and infrastructure, understanding the games behind the code will be as critical as the technology itself. This isn't just technical theory for business development professionals—it's strategic intelligence. Whether you're launching a new product, navigating a strategic partnership, designing a pricing model or scaling a platform, understanding how incentives shape behavior can be the difference between short-lived interest and sustainable growth. Integrating game-theoretic thinking into your go-to-market, partnership and product strategies can help ensure you're not just building tech, but trust, adoption and defensible network effects. Forbes Business Development Council is an invitation-only community for sales and biz dev executives. Do I qualify?
Yahoo
23-07-2025
- Business
- Yahoo
U.S. Inflation Is at 2.7%. Is It Time to Invest in Cardano?
Key Points Cardano is a deflationary cryptocurrency with a maximum supply of 45 billion tokens. Cardano became popular for its energy-efficient proof-of-stake system, but that's no longer a big deal for a cryptocurrency. Despite lackluster development, Cardano has been making some interesting moves lately. 10 stocks we like better than Cardano › Inflation has come down quite a bit since 2022, when it reached 9.1%. The 12-month U.S. inflation rate sits at 2.7% as of June. During the two-decade period from January 2005 to June 2025, inflation was 2.6%, so the current rate is in line with the long-term average. But those rates are more than the Fed's target of 2%. And inflation, while normal in a healthy economy, cuts into your wealth unless you put your money in assets that generate a return. Cryptocurrency has become a popular hedge against inflation, and especially market leader Bitcoin (CRYPTO: BTC). The price of Bitcoin makes it a daunting investment, though -- it costs about $119,000 at the time of this writing (July 22). If you're looking for an inflation hedge that costs well under six figures, Cardano (CRYPTO: ADA) fits the bill, with a price of less than $1. It also has an important similarity to Bitcoin. Cardano's economic structure makes it a potential hedge against inflation Cryptocurrencies are either inflationary or deflationary depending on their tokenomics. An inflationary coin has a supply that increases over time, diluting the value. A deflationary coin has a fixed maximum supply. Because there's a firm limit on the number of coins, deflationary coins have a built-in scarcity that can increase their value over time. Bitcoin is the most famous example of a deflationary coin. It has a maximum supply of 21 million, and once all those coins are mined, there won't be any more released. Cardano is also deflationary, with a maximum supply of 45 billion ADA tokens. Even though it has a much larger supply, there's still a firm cap on how many tokens will ever be in circulation. Cardano currently has a market cap of about $30 billion, putting it in the top 10 cryptocurrencies by size. It's successful, with the potential for explosive growth. Now, let's look at whether that's likely to happen. A breath of fresh air -- in 2021 Cardano is a blockchain with smart contracts, and it originally stood out for using a proof-of-stake system to validate transactions. Bitcoin uses a proof-of-work system, and so did Cardano's main competitor, Ethereum (CRYPTO: ETH), at the time. Proof of stake is much more energy efficient and allows investors to earn rewards by staking their Cardano tokens. Cardano also uses peer-reviewed research as part of its development process. While many cryptocurrencies lean toward a hyper-fast development approach, Cardano's team opted for a more methodical style. Those differences from other cryptocurrencies made Cardano an exciting investment in 2021, when it gained a reputation as a "green cryptocurrency" for its energy efficiency. By Sept. 2, 2021, it was up 1,520% on the year and had hit an all-time high of $3.10. But Cardano quickly became one of many proof-of-stake cryptocurrencies, so that no was longer a competitive advantage. Ethereum switched to proof of stake, and now Solana, BNB, Tron, and plenty of other coins use this validation method. And as you can see in the chart below, those other major proof-of-stake coins have soundly outperformed Cardano during the past three years. Ethereum Price data by YCharts The peer-review process has turned out to be a disadvantage, as other blockchains have been able to build more and attract larger user bases than Cardano. The total value locked (TVL) on Cardano smart contracts is $388 million, according to DeFiLlama, which doesn't even place it in the top 20. Ethereum leads with $98 billion, and Solana is also well ahead of Cardano with $10 billion in TVL. Should you invest in Cardano right now? It's not all bad news for Cardano. The blockchain launched its Voltaire upgrade last September, introducing a voting system for network participants to help speed up the development process. Its Layer-2 scaling solution, Hydra, improves Cardano's performance by processing transactions off-chain. This November, Cardano plans to launch a side chain, Midnight, that's designed to protect commercial and personal data. There are still signs of life for Cardano. The fact that it's deflationary gives it some built-in scarcity that many of its competitors don't have (Ethereum and Solana have no maximum supply, although Tron does). And during the past year, Cardano is up 96%. That said, I consider Cardano a hold at the moment. (That's the approach I'm taking, as it's part of my crypto portfolio.) I think it still has some potential, but I wouldn't recommend buying until it can string together more positive developments and attract more users to its ecosystem. Should you buy stock in Cardano right now? Before you buy stock in Cardano, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Cardano wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $665,092!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,050,477!* Now, it's worth noting Stock Advisor's total average return is 1,055% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Lyle Daly has positions in BNB, Bitcoin, Cardano, Ethereum, and Solana. The Motley Fool has positions in and recommends Bitcoin, Ethereum, and Solana. The Motley Fool has a disclosure policy. U.S. Inflation Is at 2.7%. Is It Time to Invest in Cardano? was originally published by The Motley Fool
Associated Press
28-05-2025
- Business
- Associated Press
CROSS Sets New Benchmark with Transparent and Fair Token Launch
CROSS Public Sale Concludes - A Bold Experiment in Tokenomics Democracy. Opengame Foundation Completes Public Sale of CROSS Token, Burns Unsold Supply to Ensure Transparency and Value Stability ZUG, CH / ACCESS Newswire / May 28, 2025 / Opengame Foundation (OGF), the non-profit organization behind the open blockchain gaming platform CROSS, has officially concluded its public token sale for the CROSS utility token. The public sale, which ran for one week starting May 15, drew attention across the Web3 industry for its unique commitment to fairness and transparency. Tokens were offered at a fixed price of $0.10, the same as in the private sale, ensuring that all participants-whether early backers or new supporters-had access under identical conditions. In total, 96 million CROSS tokens, representing 9.6% of the platform's total supply of 1 billion, were made available during the public sale on a first-come, first-served basis. Approximately 92% of the allocation was sold by the end of the sale period. The remaining unsold tokens will be permanently burned-a move designed to reinforce both the integrity of the token's value and the foundation's long-term commitment to transparency. Henry Chang, CEO of NEXUS and key contributor to the CROSS ecosystem, described the initiative as 'an unprecedented experiment.' In a post on X (formerly Twitter), he wrote: 'Another dot, placed. We've now completed an unprecedented experiment-offering the same price to private and public investors, including the founder and team ourselves. I appreciate the support and investment from all who believed in us. Time will reveal how this unfolds. As we head toward the next milestone, TGE, we'll keep doing what we've always done: Build-so that one day, we can connect the dots backward.' The Opengame Foundation plans to distribute CROSS tokens to public sale participants in accordance with the TGE timeline. Together with NEXUS, it will accelerate the growth of the CROSS ecosystem, bringing more developers and players into the open blockchain gaming space. About Opengame Foundation Opengame Foundation (OGF) is a non-profit organization committed to building an open and inclusive blockchain gaming ecosystem. As the steward of the CROSS Protocol, OGF aims to empower both developers and players by providing transparent infrastructure, fair tokenomics, and interoperable tools that support the next generation of Web3 games. With a focus on long-term sustainability, openness, and community participation, the foundation works to democratize access to digital assets and reshape how value is created and shared in the gaming world. Media Contact Organization: Opengame Foundation Contact Person Name: Doyi Kim Website: Email: [email protected] Country: Switzerland SOURCE: Opengame Foundation press release
