aaThe heart of the Cardano protocol is decentralization. To prevent existence of big pools, there is a limit to the size of rewards a pool can earn per epoch. The total stake of a pool consists of ADA coins of the pool operator (pledge) and delegated ADA coins. If the number of ADA coins in the pool exceeds what is considered the saturation point, the rewards for the pool operator and stakers begin to diminish. The saturation mechanism was designed to prevent centralization. The network encourages stakers to delegate to different stake pools and incentivize new operators to set up alternative pools.
Each pool operator must consider whether it is economically worthwhile to operate another pool after ADA coins fill the existing pool to the point of saturation. Stakers have free will in deciding whether to delegate their ADA coins to other pools of the same operator. Operators should earn the trust of stakers through some form of active work for the ecosystem. Stakers should consider whether a given pool operator deserves to operate multiple pools.
The Cardano protocol can be parameterized. The parameter K determines the number of existing pools, which is currently considered ideal. Maximum rewards for pool operators and stakers would be achieved if a few conditions were achieved. One of these conditions is that there are just the number of pools defined by parameter K, these pools are just before the saturation point, and all pools are 100% successful in producing blocks. You can calculate the saturation point by taking the number of ADA coins in circulation and dividing by K. Setting the K parameter to 500, this would be e.g: 34,000,000,000 / 500 = 68,000,000.