Game theory

Initially proposed by mathematician John von Neumann and economist Oskar Morgenstern in 1940s, it is theory that studies the interactions and decisions between individuals. It uses mathematical models and analytical methods to study the decisions of multiple individuals in a specific environment with the aim of achieving the maximum expected benefit.

In Game Theory, individuals are called "players," and the decision of each player affects the decisions of other players and the final outcome. In the game, players can adopt different strategies, each of which has corresponding benefits and risks. By analyzing the benefits and risks of each player under different strategies, the optimal strategy and optimal result can be determined. Crypto games often involve collaboration or competition among multiple participants, so Game Theory models can be used to describe and analyze decision-making and strategy choices in games, such as cooperative and competitive battles, individual mining and trading decisions, market expansion, token prices, token auctions, etc.

Some basic concepts in Game Theory include:

• Strategy: the action taken by a player in the game

• Payoff: the benefit obtained by a player in the game, which can be money, profit, social reputation, etc.

• Nash Equilibrium: the state in which all players in the game adopt the optimal strategy, and no player can obtain more benefits by changing their strategy

• Game matrix: a matrix formed by listing all strategies and payoffs in the game, used to analyze and calculate the optimal strategy and optimal result

• Cooperative games and non-cooperative games: cooperative games refer to games in which players have a cooperative relationship and can achieve the optimal result through negotiation; non-cooperative games refer to games in which players do not have a cooperative relationship, and each player only considers their own maximum benefit