QUESTIONS BOUNTY

• How centralized or decentralized is NEAR, really?
• Choose at least two distinct measures of decentralization that can be explored with on-chain data; clearly define those metrics; and outline how NEAR performs based on those metrics.
• In your view, is NEAR becoming more centralized or decentralized over time?

INTRODUCTION

==What Is NEAR Protocol (NEAR)?==

NEAR Protocol is a layer-one blockchain that was designed as a community-run cloud computing platform and that eliminates some of the limitations that have been bogging competing blockchains, such as low transaction speeds, low throughput and poor interoperability. This provides the ideal environment for DApps and creates a developer and user-friendly platform. For instance, NEAR uses human-readable account names, unlike the cryptographic wallet addresses common to Ethereum. NEAR also introduces unique solutions to scaling problems and has its own consensus mechanism called “Doomslug.”

NEAR Protocol is being built by the NEAR Collective, its community that is updating the initial code and releasing updates to the ecosystem. Its declared goal is to build a platform that is “secure enough to manage high value assets like money or identity and performant enough to make them useful for everyday people.”

Flux, a protocol that allows developers to create markets based on assets, commodities, real-world events, and Mintbase, an NFT minting platform are examples of projects being built on NEAR Protocol.

In a decentralized blockchain network, no one has to know or trust anyone else. Each member in the network has a copy of the exact same data in the form of a distributed ledger. If a member's ledger is altered or corrupted in any way, it will be rejected by the majority of the members in the network.

• As part of the PoS consensus mechanism, validators are responsible for verifying new blocks and adding them to the chain to earn rewards. Most blockchains are designed to be decentralized. This means that there is no single centralized authority that the blockchain answers to.
• Stake pools are a key part of decentralized network, supporting the mechanisms that ensure the long-term health and liveness of the network. By running a stake pool, stake pool operators enable other users to participate in the protocol and gain rewards without needing to continuously run an online node.

Approach

In this dashboard I have observed two metrics in NEAR protocol and THOR chain which are Stake Pools and Validators. and as you will see total number of these metrics also daily, monthly and yearly charts of them will be drawn to see their performance totally and over these time frames.

Data of NEAR protocol extracted from near.core.dim_staking_actions table and data of THOR chain extracted from thorchain.core.fact_stake_events table.

• Stake pools
  • A stake pool is a reliable server node that focuses on maintenance and holds the combined stake of various stakeholders in a single entity. Stake pools are responsible for processing transactions and producing new blocks
• Validators
  • Validators, much like miners in a Proof-of-Work(PoW) network, are network nodes that operate in Proof of Stake (PoS) blockchains, also validating transaction blocks to the blockchain.

OBSERVATION

NEAR has created 255 distinct stake pools so far and this number for THOR chain is 61, this means NEAR is much more decentralized in terms of number of stake pools with having stake pools 4 times more than THOR chain.

OBSERVATION

NEAR has created 93.3K distinct validators so far and this number for THOR Chain is 18.87K, this means NEAR is much more decentralized in terms of number of validators with having validators 5 times more than THOR chain.

OBSERVATION

Stake pools

Daily number of distinct stake pools created on NEAR has started with values around 50 and rose up steadily to values around 70 recently and maxed out on January first with 107 created stake pools on a single day.

Daily number of distinct stake pools created on THOR chain has started with values around 5 then has volatile chart during April, May and June 2021 then since October 2021 that reaches to values around 20 decreases steadily to values around 15 on recent days.

Validators

Daily number of distinct validators created on NEAR has started with values around 200 and then roses up to it’s maximum which occurred on November 11th 20211 with 4,438 validators on a single day, after that we see a decreasing trend for rest of the time frame.

Daily number of distinct validators created on THOR chain has started with values around 90 then has volatile chart during April, May and June 2021 then since October 2021increases towards it’s maximum which occurred on April 4th of 2022 with 2,119 validators then decreased since that day.

OBSERVATION

Stake pools

Monthly number of distinct stake pools created on NEAR has started with 76 on September 2021 and increases on bullish trend until October 2022 with 147 stake pools, though it maxed out on January 2022 with 160 stake pools.

Monthly number of distinct stake pools created on THOR chain has started with 19 on September 2021 and increases on bullish trend until October 2022 with 29 stake pools, though it maxed out on April 2022 with 36 stake pools.

Validators

Monthly number of distinct validators created on NEAR has started with 5.5K on September 2021 and roses up next month to it’s maximum value which is ~26K then decreases until July 2022 and increases steadily since.

Monthly number of distinct validators created on THOR chain has started with 367 validators and increases until April 2022 with ~6.4K validators then decreases since.

OBSERVATION

Stake pools

Number of NEAR distinct stake pools created on 2022 is ~1.45 of 2021

Number of THOR chain distinct stake pools created on 2022 is ~1.21 of 2021

Validators

Number of NEAR distinct validators created on 2022 is ~1.17 of 2021

Number of THOR chain distinct validators created on 2022 is ~1.74 of 2021

CONCLUSIONS

As we saw on yearly charts validators and stake pools of both networks has been increased in 2022 compared to 2021 so we can say that both networks became more decentralized in 2022, and as we saw both daily and monthly charts of stake pools were increasing on both networks, but if we look into daily and monthly charts of validators on both networks we see decreasing trend but on NEAR this decreasing trend stops and increases for at least 4 past months so NEAR has been performed better in decentralization by numbers of validators in recent month than THOR chain.

SPECIAL THANKS

Finally, I wanted to thank my colleague bam78 for helping me to make this bounty and to get all this information.