Validator Relations covers a broad range of issues that face the Terra community. We uphold three primary pillars to guide the department:
- Immutability: The ability for the validator community to operate without concern of being disabled by external factors.
- Decentralization: The ability for the validator community to share workload and benefits equitably among members.
- Development: The ability of the validator community to onboard, retain, and improve validator capabilities.
Operational transparency will allow for augmented network security. To this end, a monthly review will be published here on Medium. We will also maintain a series of public reports. We are starting via Google Docs, accessible here.
This article will be the first of a series of monthly articles about the current landscape of Validators on the Terra network. As the date before July 13th was not cataloged, this article will not be as comprehensive as those that follow.
There may also be substantial changes in the process as the initiative progresses.
July Review:
Validator Relations in July focused on decentralization. A topic that will remain sharply in focus.
For the first time since the beginning of 2021, TFL examined its delegations via the Terra Delegation Program (TDP). Let’s review the effect this had on decentralization by the numbers.
Delta Hi-Lo:
This is the spread between the voting power of the largest validator vs. the voting power of the lowest validator.
- The July 13th spread was 7.95%.
- The July 31st spread was 7.01%.
This represents a flatter spread concomitant with the TDP initiative.
Average Voting power:
This is the ideal voting power if all validators had equal voting power.
- On July 13th, this threshold was 0.83%.
- On July 31st, this threshold was 0.77%.
Again, the decrease in average voting power represents a meaningful course towards better decentralization.
Count of Validators to majority voting power:
This is the minimum number of validators that would be required to reach over 50% voting power.
- On July 13th, this was 13 validators.
- On July 31st, this was 14 validators.
Count of validators below voting average:
This is the number of validators that are below the average ideal voting power.
- On July 13th, this was 87.
- On July 31st this was 95.
The jump was due to the 29 new validators joining the active validator set in July.
Gini Coefficient:
“A useful way to think about the decentralization of blockchains is by using an economics tool called the Gini coefficient. The Gini coefficient is a metric usually used to describe the level of income inequality in various countries. A Gini coefficient of 1 would indicate economic resources are completely centralized (i.e., perfect inequality) whereas a Gini coefficient of 0 would indicate economic resources are evenly distributed to all participants (i.e. perfect equality).”
Before the administration of the TDP, the Validator Network had a Gini Coefficient of 0.71. After the administration of the TDP, the Gini Coefficient dropped to 0.64. This is a significant difference.
Moving Forward
A similar, more in-depth overview of the network’s validator ecosystem status will be released monthly going forward. Follow here on Medium and on Twitter for further updates.
