Decentralization Measures

Decentralization is a multifaceted concept that encompasses various aspects of a cryptocurrency network, making it challenging to evaluate using a single metric. Different measures of decentralization capture distinct elements of the network, shedding light on its overall security and resilience. Here's how Chia stacks up against other popular cryptocurrencies on some of those measures to understand why Chia can be considered one of the most decentralized cryptocurrency in existence.

Did you know?
What are Full Nodes?

Full nodes contribute to network resilience, decentralization, increased security, and enhanced privacy. They store a complete copy of the blockchain, validate and relay transactions, and serve as essential network infrastructure.

Having many full nodes on a network ensures a robust and reliable cryptocurrency ecosystem by mitigating single points of failure, detecting and resisting malicious activities, and promoting a trustless, censorship-resistant environment.

Pro Tip
Unreachable Peers

Estimates of Bitcoin full node count can vary greatly online due to differences in peer discovery methodology, requiring more creative methods such as those used by luke.dashjr.org.

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Nakamoto Coefficient

The Nakamoto Coefficient (NC) is a metric used to evaluate the decentralization of a blockchain by measuring the minimum number of entities that control enough of a resource (mining power or staking power) to attack or shut down a network.

Named after Bitcoin's creator, Satoshi Nakamoto, a higher number is indicative of a network that is less susceptible to collusion or attacks.

Pro Tip
Bitcoin Pool Centralization

Bitcoin has a lot of individual miners but mining pools are a point of centralization because the pools form blocks -- unlike the Chia protocol where farmers maintain that power. Hopefully upgrades like StratumV2 get adopted that will re-empower the individual Bitcoin miner.

Geographic Decentralization - Full Nodes per Capita
Did you know?

Chia has more active full nodes in Ukraine during a war than most blockchains have full nodes globally.