The proposed mainnet poll has been detailed by Cardano Foundation.
Proposed poll text:
Which setup would you prefer to be put in place from Q3 2023 onwards?
- Keep k at 500 and minPoolCost at 340 ada.
- Keep k at 500 and halve minPoolCost to 170 ada.
- Increase k to 1000 and keep minPoolCost at 340 ada.
- Increase k to 1000 and halve minPoolCost to 170 ada.
- I would prefer to abstain.
- None of the above.
So what should I pick when I don’t think any of these options is ideal?
K
What is the point in changing K when this will have almost no effect on the real minimum attack value (MAV) (currently around 23)? In particular we are kidding ourselves if we think that the K value has any direct correlation with the minimum attack value. (Minimum attack value (or vector) is analogous to the Nakamoto coefficient which measures decentralization and represents the minimum number of actors required to disrupt the blockchain’s network.)
But, maybe there is an advantage in voting for an increase in K? My thinking here goes something like this: Increasing K will force multii-pool operators to split their pools and in turn cause delegators to re-think their delegation strategies. The mult-pool operators will have some difficulty managing this situation and hopefully they will lose some delegation, which will be beneficial for small pool operators.
So, in other words, I think I should vote for an increase in K, but not for increased decentralisation reasons, but rather to create disruption for multi-pool operators in the hope that they will bleed stake to small pool operators. Which I guess, in turn, you could argue might improve decentralisation, slightly.
minPoolCost
I personally believe minPoolCost should be drastically reduced to something around 30 Ada. A reduction to 170 is at least a step in the right direction and it is the only reduction option I have. So I guess I should vote for 170.
I don’t want to Abstain or vote “none of the above” as these seem like wasted votes.
Conclusion
So, in conclusion, I should vote for option 4: “Increase k to 1000 and halve minPoolCost to 170 ada”, even though my reasons are based on game theory rather than what I actually think is ideal.
This illustrates the problems with polls like this. The options presented, or even how they are worded, can greatly affect the outcome. Furthermore, the reasoning behind why participants voted a certain way comes back to the available options, and the wording used. This reasoning may not be immediately transparent when tallying the final votes.
Specific criticism of poll option of 170 Ada minPoolCost
@Colin_Edwards proposed the following in this post Minimum pool fees with a brief mention of k changes:
The proposal that best adheres the initial specification of the minimum fixed fee, in my opinion, is to move the fee from 340 Ada to 30 Ada. This would reset the relative sensitivity of the variable fees and fixed fees back to their original levels, and it also closely matches the original fiat values of the fee, which was originally set to around $5.25 / day. That will not fully compensate pools, the intent was that the variable fee would be useful in more situations than just when demand for staking far exceeded the available capacity of stake pools.
Why have the Cardano Foundation chosen a figure of 170 which seems to be not based on any quantitative logic? Does Cardano Foundation not agree with the reasoning of @Colin_Edwards who works as a quant?
Halving the minPoolCost only lowers the barrier to competitiveness for a small pool operator from requiring a stake of 10 million Ada to 5 million Ada. To make small pools competitive, we need to lower it to about 1/10th which coincidentally is the 30 Ada figure Colin suggested. Then the barrier for a small pool to be competitive would be lowered to only needing 1 million Ada in total stake.
For the record, this is what I say on my website as a caution for potential delegators to my pool:
I do not recommend you stake with Terminada pool yet because the protocol does not allow setting the fixed fee any lower than 340 Ada.
With a fixed fee of 340 Ada you will lose too much of your rewards to fees until the pool size is over 10 million Ada.