On Risk Symmetry and Code is Law
▻https://hackernoon.com/on-risk-symmetry-and-code-is-law-c8823fd494ea?source=rss----3a8144eabfe3
Skin in the game is a foundational concept in the context of crypto networks. Stakeholders have skin in the game through owning tokens of monetary value, and are as a result financially incentivised to collectively work for a network. Its a powerful concept and a means to ensure risk symmetry, which is the notion that when people take on risk , they are directly exposed to both the potential upside and downside. That is, downside risk can’t be arbitrarily transferred to somebody else when it feels right. You own your risk.In a well-designed crypto network, token holders are held directly accountable for the actions they take. The reality is that programming incentives structures that function as intended and enforce risk symmetry is hard. Work tokens already offer an improved design to (...)
#blockchain #fintech #risk-symmetry #cryptocurrency #code-is-law