The Moloch DAO: Collapsing The Firm.

“referring to a person or thing demanding or requiring a very costly sacrifice.”

Making it beneficial for early defectors to defect not only rewards those defectors in believing their new opportunity is a better choice, it also strengthens the value of the focal point of the existing group (think: “All the non-believers left. Thus, I can believe in those that are still here, more”).

When no other options present themselves, humans are pretty good at assuaging themselves of their predicament. When no other doors are open, it’s easier to argue that the metaphorical room you are stuck in isn’t too bad after all.

When we have many options available on the other hand, exiting also becomes a stronger signal for those who actively does not. This is apparent in countries that are in decline. Over time as people emigrate, those that stay are actively signalling that they aren’t exiting. It thus reinforces the bonds of the groups who are staying. This is also apparent in relationships. Those who stay when they have options, is a strong signal to the partner of the commitment.

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