Yes, I was not aware of this aspect of the election process (each KMD votes in each region). I had anticipated a node quota being 1/64 of 100M KMD, with this scheme a node quota will be 1/16 of KMD, which is 6.25% of the vote. Even with ~2.7% of the vote I am clearly well under half a quota now. I am considering whether to run now at all as I don't believe I would get elected now. My 'plan B' option of hiring a node operator myself to run a 'guaranteed' node looks to be dead in the water. Maybe 2-3 other individuals could combine votes with me into 6.25% of the total vote and then we run 4 guaranteed nodes, but that is more difficult. As I said above, I prefer a set-and-forget arrangement that gives me a nice income stream. Less is more for me if the arrangement is simple and easy to manage!
Others have mentioned the likelihood of 'voting pools' starting eventually, similar to mining pools in PoW coins, and forging pools in NXT. I will wait and see what happens there. I am not too keen on the idea of just selling my vote to the highest bidder, but 2.69% of the vote does have some value. I do want to see viable and stable node operators emerge, but where there are elections and money involved, there will always be coalitions, horse-trading, & deals made to get people elected. I will wait and see what happens. I will say I have no complaint on the election scheme. I was not aware of this detail, but it makes sense why it was chosen.
A lot of voting will be somewhat random and spread out across all candidates, so any node that gets a significant stake voting for it will get a very large chance to win.
It is like the swing states votes. A relatively small amount of voting power determines the winner.
I think it is good that a large stakeholder is actively campaigning and I would assume many others would too and so you should get votes from the rest of the voters.
Thanks James! I think it'll take a while to fully digest the situation with the node elections. I've faced some criticism of my actions in private, and maybe some people think big holders of KMD should just vote for good node candidates and not try and make any return for themselves. I understand this point of view, and it makes sense for the first few elections. But later on I think it's best to view things from a different perspective. Let me give an example that illustrates how I view the notary node economy.
In my city, as in many others, the government wants to insure a good taxi cab service is provided to the city residents. They set the number of taxi licences and auction them off periodically. Occasionally they will buy some licences back too. Their goal is to find the 'sweet' spot for taxi numbers - too many licences and competition is too great, and drivers can't make a decent living so drop out, or cherry pick the prime times and locations only, so overall service levels decline - but too few licences and while drivers can now make a good living, there aren't enough cabs to provide a reliable city wide service.
With Komodo nodes we have a similar situation to taxi cab numbers. We want a reliable global service - too many notary node numbers and competition will be too great and operators wont be able to earn a stable income, so overall notary service level will decline - too few nodes and operator income is stable, but there aren't enough nodes to provide a reliable global service.
In the taxi example the government sets the number of taxi licenses and auctions them off. Some drivers will start off in the industry as a wage earning driving for another licence holder, then they save up and buy their own licence and graduate to an owner/driver. Some will often buy up a second and third licence as they accumulate savings, and they will hire drivers for their other taxis (i.e. they share the guaranteed income from the licence they purchased with a driver who doesn't own a licence). So a taxi licence is a valuable asset, it can provide a stable income for the owner, from being a taxi driver OR from hiring a driver and sharing the guaranteed income.
With Komodo, jl777 could have auctioned off 64 notary node licences as an alternative method to the election system. It could achieve the same result, stable income for node operators and reliable notary service for the network. With the election system there aren't 64 explicit node licences as with the taxi example, but the 100M 'votes' of KMD holders perform the same function. If you want to drive a taxi and earn a stable income you either buy a licence for yourself and drive the cab, or you come to a profit sharing agreement with someone who owns a spare taxi licence. In a similar way, if you want to earn a stable income running a node you don't buy a notary node licence, but you need to 'acquire' sufficient votes for a notary quota in the election.
At the start when KMD price is low it does make sense to support existing testnet guys, at monero sized marketcap it becomes a little more like the taxi example. At ethereum marketcap running KMD nodes will be highly profitable, so it will definitely start feeling like the taxi example.
So if I own 2.7M KMD votes it means I own equivalent to ~40% of a node 'licence' in each region. If I use that to make some income it's the same as if I bought 40% of a taxi licence and hired a driver. The driver does the work, but I own 40% of what gives him the ability to do the work. That is what restricting the number of nodes to 64 means. The KMD votes have a value in the system, by design.
That's how I see things anyway.
Depending on the market price of KMD, a notary node is either a way to make a bit of money each month in exchange for a bit of time, or a money printing machine.
Based on the randomized round robin, each notary node (at 64) will get approx 2000 KMD per month. At 6 cents, this requires some BTC subsidy to cover the costs of the notary operators. At 25 cents, it is self-sufficient without any need for BTC subsidy. At $1, well it is a nice income in most parts of the world, etc.
So the election dynamics will definitely change as the KMD market price changes. However, KMD enabling people with money to make more money, well that is the golden rule and I dont see anything wrong with that. Especially as in order to protect their investment, they will need to ensure stable servers.