Question

How centralized or decentralized is NEAR, really?

Choose at least two different 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

In this dashboard, we have analyzed the decentralization performance of NEAR in its network. In order to have a better view of the decentralization matter from the point of view of the NEAR developers, we will present the explanations given by the NEAR developers for the decentralization of the network. Then we define two criteria that can be obtained according to the flipside data.

Since its inception, NEAR Foundation has been committed to not only helping build a fast, secure and scalable blockchain but to facilitate the decentralization of the network to the community.

Not only are concrete steps being taken to fast-track the decentralization of NEAR’s underlying technology and infrastructure, but massive contributions are being made towards galvanizing the developer community, ensuring that power lies with the community upon which NEAR thrives.

• Decentralizing for a vibrant Web3 experience

  • In decentralization, control and decision-making are transferred from one centralized authority to a distributed network of community participants. At their core, decentralized networks work to improve the functionality, security, and success of the network by removing the ability of any individual party to exert control over another.
  • Decentralization provides a trustless environment, where overall data reconciliation is improved through validators, and every participant has access to a real-time, shared view of the data. Decentralization really shines through its ability to optimize resource distribution, resulting in an amazingly reliable and consistent experience for developers, validators, and end-users alike.

• Rooted in cutting-edge, scalable infrastructure

  • Most blockchains require every node (stakeholders maintaining the network) to store all of the chain’s information as well as process all of the network’s transactions for block production. While keeping the network secure, this can lead to extreme inefficiency and unbearable slowness, as it takes varying amounts of time for all nodes to keep themselves up to date. In turn, this can also make Web3 app building and scaling prohibitively expensive for some developers – a significant hurdle to mainstream adoption.

  • NEAR’s Nightshade Sharding alleviates inefficiency and bottlenecks by partitioning a database into smaller pieces (shards). ==Nodes are divided into small groups responsible for one part of the chain’s data== and are able to process transactions simultaneously. The inefficiency of one node verifying transactions in one block is ==supplanted by multiple nodes verifying transactions in multiple blocks.== The result is exceptional speed and throughput on the chain.

  • While many new blockchains are developing layer 2 scaling solutions and offer theoretical throughput of thousands of transactions-per-second (TPS), their underlying infrastructures hit upper limits that ultimately place a throttle on their capabilities. NEAR’s Nightshade Sharding allows for linear scaling of throughput corresponding to the number of shards, laying the foundation to scale to demand as more and more users onboard the platform. In essence, the network will create more shards when the network is in high demand, and scale them back when demand drops, saving energy and resources. Ultimately, ==Nightshade gives NEAR the capability to accommodate mass consumer adoption, up to billions of users.==

    NEAR is simultaneously working on a number of improvements on the protocol level that will build a secure, user-friendly, and scalable blockchain that can support mainstream usage and adoption.

• Accessible and inclusive blockchain validation

  • In December 2021, the NEAR Protocol team released the updated validator selection algorithm, paving the way for 100 validator nodes on Mainnet, which reduces the validators’ barrier to entry by bringing down the seat price from 3.6 million $NEAR to 67,000. This lowered seat price makes it easier for them to join the active validator set and maintain their seats. Working against exclusivity, NEAR is committed to making these seats accessible to all demographics, socio-economic classes, and geo-locations.
  • To further lower validators’ barrier to entry and make this role more accessible to all, NEAR is introducing Chunk-Only Producers in mid-2022. Soon, more individuals will be able to contribute to the participants in the block-producing process, which creates new opportunities to not only earn rewards but also enhance the NEAR ecosystem’s security

• Decentralization as a catalyst for community

  Source: 

Choose Measurements

In a decentralized network, the network's performance is essential in terms of security and speed of operation. In this dashboard, we examine the following two criteria.

1. Correct network operation
2. Network speed

For the performance of the network, we check how many transactions are successful and how many of them Fail. This examination is done at monthly intervals.

For network speed, we get the number of transactions recorded in each block and the number of transactions per second for daily intervals.

The data available in Flipside for NEAR transactions is from 2021-09-01, as a result, we check the amount obtained based on the months after this date.

Optimism

For comparison, we compare the performance of the NEAR network with the Optimism network.

The reason for choosing this network for comparison is the number of users and the size of the network, which is more similar to the NEAR network.

COMPARE

According to the data obtained for the Optimism network, we can see that the number of transactions performed in this network is much less than that of the NEAR network, so in order to compare the criteria, conditions must be considered.

The number of transactions performed in the Optimism network has grown upward and has increased every month, this number has reached more than 6 million transactions per month.

The percentage of failed transactions in this network has reached nearly ten percent in the worst case, where more than 3 million transactions were made in that month.

The number of transactions performed in the network it has reached 300 transactions per minute and 5.1 transactions per second in the best case.

In this network, only one transaction is recorded in each block.

meserments	Near	Optimsim
Max Transactions per month	25M	6.6M
Max Fail Ratio per month	40%	9.4%
Max Transaction per Minute	1386	310
Max Transacitons per block	33	1
Max TPS	19	5

Result

While checking the performance of the network, we can see that the number of transactions made in the network has increased over time, and the number of transactions that failed in the network has also increased. In August, with 13 million transactions, more than forty percent of transactions were unsuccessful.

To check the speed of the network, we have obtained the number of transactions per minute and per second, and we have also shown the number of transactions recorded in each block. According to this characteristic of a decentralized network, it is able to have a large number of transactions, from the transactions that have been handled, we can see that with the increase in the number of transactions, the NEAR network has the ability to handle more than a thousand transactions every second.

According to the diagrams obtained, it seems that the architecture of this network has the possibility of handling decentralization and the reason for the low number of transactions can be related to the number of users using this network.

According to the rates obtained for the number of delegations performed every day, we can see that the number of people who have done stakes in validators has decreased, and NEAR has moved from decentralization to centralization.

Conclusion

In this dashboard, we took a closer look at the performance of the NEAR network in terms of decentralization. To perform this investigation, we have used several measurements and have measured the performance of the network over time based on these criteria.

According to the explanations provided by the NEAR development group and also the available data in Flipside, we have used these defined criteria to check the network performance.

Finally, we have obtained the criteria for the Optimus network and compared it with the Neir network

According to the obtained results, the following can be mentioned:

1. Over time, the use of the NEAR network has increased.
2. Based on the network architecture, this network has the ability to perform more transactions per second and can handle a large volume of transactions.
3. NEAR network has been able to perform better than Optimism network.

Contact

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