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Game Theory

IndexPVP is not just a trading game — it's a multi-player iterated game with complex strategic dynamics. Understanding the game theory gives you a massive edge.

The Core Tension​

Every player faces a fundamental dilemma: cooperation vs. competition.

  • Cooperating with other players (e.g., all pumping the same index) creates a strong voting bloc that can protect its members
  • Competing against other players (e.g., buying undervalued indexes that might receive buyback ETH) can yield higher individual returns

The optimal strategy shifts as the game progresses and the number of surviving indexes shrinks.

Seats at the Roundtable Are Everything​

The single most important mechanic in the game is: only the top holder of each listed index gets a vote. One seat per index, weighted by market-cap rank.

This means:

  1. A seat at the roundtable is worth far more than a generic bag of tokens — you either have one or you don't
  2. The #1 index is the blue chip — immune from delisting AND holding the heaviest vote (weight = listedCount)
  3. A single #1 wallet in the last-place index still beats holding 10% of #1's supply — you still only own ONE seat per index

No Kingmaker — But Plenty of Power Players​

The ranked-seat model spreads voting power across one leader per listed index instead of concentrating it in whichever wallet happens to hold the most of a single index's tokens. Even so, power concentration still exists in two forms:

  • Multi-seat players: A wallet that's the top holder of several indexes at once can swing multiple weighted votes
  • High-rank seat: The #2 leader's vote alone is worth listedCount - 1. At full table that's almost the heaviest possible vote; a single high-rank seat can outvote a dozen low-rank seats

Counter-play: if a competitor overtakes your top-holder position in an index, your seat flips to them — track your margin, not just your balance.

Earning a Seat​

Smart players decide where to be #1 before the countdown expires. The ideal strategy:

  1. Identify indexes where the current top holder's lead is thin or where the total supply held is small
  2. Accumulate until you overtake — you don't need 50%, you just need to be the #1 wallet
  3. Aim higher in the market-cap ranking to grow your seat weight
  4. When the vote triggers, the keeper's snapshot locks in who's at the roundtable — be there before countdown expires

The Delisting Target Selection Problem​

Who should you delist? This is the deepest strategic question in the game.

Delist the Weakest (Default Strategy)​

Eliminating the index with the lowest market cap seems obvious — it's the least defended. But this is often suboptimal because:

  • Weak indexes have less ETH in their pools, generating smaller buyback rewards
  • Weak index holders may have diversified into your index, making them allies

Delist the Second Strongest (Power Play)​

Eliminating the #2 index keeps whoever currently sits at #1 safely immune next round too. Benefits:

  • Locks in the blue-chip seat's advantage another cycle (heaviest vote + delisting protection)
  • The second-strongest index's ETH is redistributed (often a large amount)
  • Removes the biggest threat to the blue-chip seat and the largest rival roundtable vote

Delist a Rival's Secondary Holdings (Meta Play)​

If you know a major player holds tokens in multiple indexes, delisting their secondary holdings reduces their total portfolio value. This is a targeted attack on a specific player, not a specific index.

Delist to Profit (Mercenary Play)​

If you hold tokens in an index likely to receive buyback ETH, you can vote to delist whichever index generates the largest redistribution. You don't care about politics — only profit.

Coalition Dynamics​

Early Game (117-100 Indexes)​

  • Coalitions are loose and informal
  • Regional blocs form naturally (European indexes cooperate, etc.)
  • Low-value indexes are easy delisting targets with minimal controversy
  • Diversification is optimal — spread holdings across many indexes

Mid Game (100-20 Indexes)​

  • Coalitions become critical for survival
  • Large blocs form around high-market-cap indexes
  • Betrayal becomes profitable as the stakes increase
  • The "vote leader" position becomes highly contested

Late Game (20-2 Indexes)​

  • Every vote is existential
  • Coalitions fracture as remaining indexes turn on former allies
  • Buyback rewards become enormous (concentrated among few survivors)
  • Holding the top-holder seat of any surviving index is nearly mandatory for influence
  • With fewer listed indexes, individual rank weights compress — at 5 indexes listed, the last-place seat is still worth 1 of 5 = 20% of total weight
  • The meta shifts from "who to delist" to "how to avoid being delisted" while staying the top holder of your index

The Buyback Lottery​

40% of delisting proceeds go to a random surviving index. This injects uncertainty into the game and has several strategic implications:

  • Luck factor: A random index can receive a massive pump, changing market cap rankings overnight
  • Portfolio diversification: Holding many indexes increases your chance of benefiting from random buybacks
  • Expected value: With N indexes listed, each has a 1/N chance of being the random recipient. As N shrinks, each buyback becomes more impactful.

Information Asymmetry​

On-chain data is public, but the vote itself is NOT — ciphertexts are posted during the window, decrypted only at reveal time. Until then, only the nullifier (which index voted, but not who they voted for) is visible.

  • Holder distribution: Check who holds the most tokens in each index. The top holder is the only player with a seat at that index's roundtable.
  • Recent trades: Watch for unusual buying patterns before vote triggers — someone might be trying to flip a top-holder position
  • Historical reveals: Once a round's votes are revealed on-chain, past voting patterns become public and reveal coalitions/rivalries — but only after the fact, never during the window
  • Nullifier leakage during window: You can tell which indexes have voted (each cast emits VoteCast(nullifier, weight) with a nullifier derived from the index's code) but not who they voted for. Use this to gauge turnout, not target.
  • Wallet analysis: Track which wallets hold top-holder positions across multiple indexes — those players have multiple seats

The activity feed and trade history in the app give you all the raw data. Your job is to synthesize it into actionable intelligence.

Nash Equilibria​

Coordination Games​

Coalitions can only be verified after reveal. Leaders can promise each other "I'll vote against X" — but secrecy means nobody can enforce the promise in the moment. Reputation across rounds becomes a hard currency: a leader who's broken coalitions in past reveals loses future coordination power.

The Free Rider Problem​

Players can benefit from an index's market-cap pump without ever earning the seat. Someone who buys a few blue-chip tokens late in the round gets price appreciation from the 40% winner buyback even though they never paid for the pump. But they don't get a vote unless they're the actual top-holder wallet.

Prisoner's Dilemma (Late Game)​

When two allied indexes remain, both leaders benefit from maintaining the coalition. But each has an incentive to defect — voting against the other to eliminate them. Secret ballots mean defection is undetectable until reveal, so trust is priced at a discount and cross-round reputation becomes the only binding force.

The Prize Pot Factor​

The Prize Pot changes the game's fundamental economics. 30% of every trading fee — across all 117 indexes — accumulates in a pot that only the winning index's holders can redeem.

How This Shifts Strategy​

  • Volume matters: Every trade in any index grows the pot. High-activity games have bigger prizes.
  • Late game holding: In the endgame, selling winning tokens at market price must be weighed against the RFV redemption. If the pot is large enough, holding to the end is always profitable.
  • Price floor: The RFV creates a guaranteed minimum value — a NAV — for the winning token. If the market price drops below RFV, buying and redeeming is a risk-free profit.
  • Kingmaker incentive: The kingmaker doesn't just control who gets delisted — they're fighting for the pot. Protecting your index to the end means securing the RFV for your coalition.

Expected Value Calculations​

Is It Worth Buying an Index?​

Consider:

  • Probability of survival: Based on market cap rank, coalition strength, and boardroom politics
  • Buyback upside: If your index receives a 40% buyback, what's the price impact?
  • Seat value: Can you realistically become the top holder of this index? If yes, a seat at the roundtable has concrete value — one vote weighted by rank, every round, until the index is delisted.
  • Delisting downside: If delisted, you lose everything (minus what you can sell before the delisting)
  • Prize pot upside: If this index wins, what's the RFV per token? Is the current price below the expected NAV?

When to Sell​

  • Before the trading halt: Avoid the 20% sell fee
  • After the circuit breaker decays: Wait 5 minutes after buybacks
  • When your index is at peak: After receiving a buyback pump, prices may decline as others take profit
  • Before a predictable delisting: If your index is the clear target, sell early
  • Never (if winning): If your index is the last ticker standing, don't sell — redeem at NAV instead. The guaranteed payout may exceed the market price