In Cardano, the optimal_pool_count (k) is a crucial parameter that defines the ideal minimum number of stake pools for a well-functioning network. Currently set to 500, k influences decentralization, security, and rewards distribution. A balance is needed between too few pools, which may lead to centralization, and too many pools, which could spread rewards too thin.
The parameter ensures that stake pools remain decentralized while offering competitive rewards for operators and delegators. When a pool surpasses its optimal size, it becomes “saturated,” resulting in diminishing rewards for delegators, encouraging them to spread stake across other pools.
Debate exists in the community over whether k should be increased to 750 or even 1000, with larger pools favoring the current value and smaller pools pushing for an increase. As of January 2025, Ada holders can now vote to change k through governance actions, and it’s expected that proposals to adjust k will surface in the future.
Read the full Article here: lidonation.com