A Note on Metcalfe's Law, Externalities and Ecosystem Splits

An ecosystem split is not going away, and we may well see more of them in the crypto industry over the next decade. We model an “ecosystem split” as a game where to start off N_a = N and N_b = 0 and users are deciding for themselves whether or not to join the split, that is, to move from A to B. The difference between the first and second (and between the third and fourth) is the extent to which utility from a system’s intrinsic quality and utility from network effects are complementary.