Source/LongHash

Source/LongHash

In 2020, the public chain of PoS additional issuance has become one of the hottest topics in the market.

This article will combine the data on the chain to analyze and compare the three star PoS projects ETH2.0, Tezos (Tezos) and Cosmos, and analyze the currency holding addresses and currency holdings of these three major networks based on current data.

ETH2.0 is the update that ETH will start this year. It is divided into four parts in total. In the phase 0 to be launched, ETH will change from PoW mining mode to PoS mining mode, which will mean new output of ETH The issuance rate of ETH will be reduced from close to 10% to less than 2%, which means that it is lower than the inflation rate of traditional currencies, and the scarcity of ETH will be proved.

Tezos is a high-performance underlying public chain that benchmarks against Ethereum. The highlight is the self-healing function. Holders of XTZ tokens can mortgage their own tokens as nodes, or entrust tokens to "bakers" indirectly Participate in governance, and carry out technical upgrades and iterations to avoid forks to the greatest extent. The community also has a layout in the direction of DeFi and compliant finance.

Cosmos is a decentralized network that provides scalability and interoperability. It is constructed by the BFT consensus algorithm of the Tendermint consensus. Tendermint Core and the Inter-Blockchain Communication (IBC) protocol form a common architecture, allowing each cryptocurrency main chain to achieve interoperability .

With the emergence of several star public chains, the adoption of the PoS consensus mechanism has become an unstoppable trend of the new generation of public chains. Staking participates in network security management by pledging tokens to prevent the tokens in the hands of token holders from being diluted due to inflation. On the contrary, in the mining field of the PoW algorithm, the business logic behind the mining industry is the manufacturing logic separated from the token, and it is more in the field of computers and hardware and offline operations. The layout of several major manufacturers represented by F2Pool and Bitmain has considerable scale effect in the mining industry, and it is difficult to start from scratch and surpass the existing giants.

Of course, PoS is not perfect. On the one hand, some projects lock the existing tokens in the hands of users, and on the other hand, they take out a part of the additional tokens as rewards to loyal users. At first glance, this model looks good, but unfortunately, due to the poor overall market in the future, the intrinsic value of some PoS tokens cannot support the actual currency price. Users who hold such projects often make money and lose money.

Later, the market preference turned to a deflationary economic model, and PoS was rarely mentioned for a period of time. However, in the first half of this year, the emergence of ETH2.0 gave this track a new brilliance. Phase 0, which is expected to be launched in the third quarter, officially confirmed that it needs to mortgage 32 ETH for PoS mining, which means lowering the The threshold of ETH's expected additional issuance and node reward model has been raised, and the Staking model has once again been pushed to the forefront. The analysis in this article is based on data from the Amberdata API.

1. How many tokens are in the top 10, 100, 1000 addresses

In the world of public chains, there is no clear identity information, and we usually use addresses as the carrier of identity. Regardless of whether there is a person or a group of people behind this address, they act consistently on the chain as a community of interests.

ETH, Tezos, and ATOM all use the account model, that is, each address is an account. As of June 17, 2020, ETH had a total of 101,539,249 accounts (Etherscan data), and after January 2018, the number increased by at least tens of thousands per day. Unfortunately, most of them do not hold tokens.

As shown above, among these ETH addresses, we see 15.93% of tokens in the top ten addresses, 35.32% of tokens in the top 100 addresses, and 64.87% of tokens in the top 1000 addresses. ATOM has a total of 31,358 addresses, 125 validators, 88.82% of the tokens in the top ten addresses, 98.62% of the tokens in the top one hundred addresses, and 99.94% of the tokens in the top one thousand addresses. Tezos has a total of 546,382 addresses, 494 bakers (equivalent to validators), 20.71% of the tokens in the top ten addresses, 53.24% of the tokens in the top 100 addresses, and 53.24% of the tokens in the top 1,000 tokens. There are 81.23% of tokens.

Comparing the total number of accounts and the number of coins held by the three addresses, it can be clearly seen that ETH is the best in decentralization, and it should be the second public chain in terms of market value. The presentation of Tezos on the three data is surprising. As a relatively new blockchain, the performance of its top ten addresses and top one hundred address tokens is not much worse than that of ETH.

Limited by the total number of addresses, the number of tokens on the top 1,000 addresses is slightly less. The Tezos system uses "bakers", which are similar to miners (but do not require expensive hardware and a lot of electricity), and bakers will maintain the security of the Tezos network and verify transactions. Among the top 1,000 addresses, bakers use a large number of their own tokens to attract external pledges, so we can think that non-bakers (that is, ordinary users) on the Tezos public chain still have a large proportion of tokens. currency. This proves that the Tezos public chain has certain advantages in terms of decentralization compared to many PoS public chains. The degree of decentralization is a key indicator of a project's potential. More decentralization means greater community and developer potential and more democratic governance.

For these three public chains that also focus on smart contracts, the more total accounts, the more potential users, and the more dispersed the currency holding addresses, the easier it is to achieve decentralization.

In terms of the number of users and the degree of decentralization, there are very few public chains that can challenge Ethereum in the short term. However, there are also many people who are bad-mouthing Ethereum, and later public chains are calling for the death of Ethereum. It is worth noting that Ethereum is not a real PoS network yet, and will switch to PoS after the ETH2.0 upgrade starts. Therefore, according to the performance of on-chain data, Tezos is currently the most likely and surest to compete with Ethereum.

2. Comparison of the pledge rate and expected income of Tezos and Cosmos, and the predicted PoS situation of Ethereum

For the PoS public chain, users pledge tokens to obtain additional issuance income and share the income of the entire network expansion. This mechanism is more friendly to the underlying users than the PoW production method. This method will also lock the liquidity of the entire network. Through the data on the chain, investors can clearly see the market value of the circulation of these PoS public chain projects and the circulation disk to be unlocked in the short term, which also promotes the possibility of speculation sex.

But it is a pity that compared with the newly issued tokens of the PoW public chain being controlled by the upstream mining machine holders, it is easier for top players to generate a consensus on holding, and lock the newly issued tokens together to wait for the price to rise. The newly produced coins in PoS public chain projects that lower the threshold of pledge have become the wool of retail investors, and they are more inclined to sell than to hold. In the absence of actual value support for the public chain, this part of the selling became the last straw that overwhelmed the camel.

According to Messari data, as of June 18, 2020, the current dynamic pledge rate of ATOM is 93.88%, and the annualized rate of return is 9.26%. Unlike the pledge rate displayed by the browser, which uses the total supply of tokens to calculate the pledge rate, the dynamic pledge rate uses the number of circulating tokens, which is more realistic than the total number of tokens, so we use the dynamic pledge rate for calculation.

As of June 18, 2020, the total market value of ATOM was US$511,415,238, which means that the non-staked circulation market value was only US$31,298,612, which was close to that of Dragoncoin, which ranked 137th on Coinmarketcap. At present, the total number of circulating supply tokens (Circulating Supply) is 190,688,439. According to the current pledge rate and annualized rate of return, the number of additional issuances per year is 16,577,095.185. That is to say, the additional tokens issued by ATOM every year are 1.42 times the existing non-pledged circulation tokens.

The dynamic pledge rate of XTZ is 79.93%, the annualized rate of return is 6.94%, and the total market value is 1936917919 US dollars. The total number of tokens in circulation is 733364642. According to the current pledge rate and annualized rate of return, the number of additional tokens issued each year is 40680778.1, and the value of this part is 107397254 US dollars. That is to say, the tokens issued by XTZ each year are 27% of the non-pledged circulation tokens.

The annual increase rate of ATOM is 1.42 times that of the circulating tokens. Investors will worry that the additional currency issued by nodes will impact the market price. In other words, such a high increase rate will greatly reduce the cost of token holders. Participating users are unfair. Relatively speaking, the issuance rate of XTZ is much lower, which is obviously more reasonable.

3. Active status of currency holding addresses

According to the data monitored by LongHash, 38% of the addresses in ETH have been active in the past year, that is, transactions or transfers have occurred. From the perspective of the number of tokens, the number of active tokens within a year accounts for 76.01% of the total circulating tokens. The Tezos mainnet was successfully launched on September 18, 2018. Among Tezos token XTZ holders, 56.2% of the addresses had active records in the past year, and in the past year, the number of active XTZ tokens The proportion reached 95.17% of the circulating supply. From the active time of the addresses, it can be seen that the top 1000 addresses have a high proportion of transactions in the past 30 days, whether it is transactions or staking, they all show a high degree of activity.

Cosmos Hub launched the mainnet on March 13, 2019. In Cosmos, 44.25% of the addresses are currently active, that is, transactions have occurred in the past month. These addresses will be in 2020, that is, 1-5 95.5% of transactions occurred during the month. It can be seen from the comparison that the overall activity of Tezos and Cosmos addresses is relatively high. The proportion of Tezos addresses that were last active in May 2020 is higher, and more than 60% of the addresses have remained active in the past month. state.

Compared with the old public chain ETH, the two public chains of Tezos and Cosmos have a relatively short online time, which makes early supporters more willing to participate in the consensus directly or indirectly to maintain network security and avoid tokens in their hands being diluted by inflation . Although in the Staking economy, the market potential has not been fully realized, in the PoS token economy not only benefits, but participants also have to fulfill obligations and bear risks. However, with the gradual improvement of supporting facilities in the industry, many exchanges and wallets have now incorporated the Staking business into their own business territory.

For example, Coinbase and Binance support XTZ staking. Users can easily participate in transactions and commissions in wallets and exchanges that integrate staking functions. These supporting facilities meet the staking operation and security requirements of many ordinary currency holders. Early investment institutions provided professional technical solutions to participate in entrustment and governance, which indirectly promoted the activity of XTZ tokens.

In the future, the decentralized governance and ecological improvement of the public chain will be the key to whether the public chain can maintain its vitality for a long time. During the development process, many designs have created the underlying liquidity requirements of the public chain. For example, Tezos and Cosmos are both committed to providing interoperability to a certain extent. Assets on Tezos and the development of tzBTC integrate Bitcoin and Cosmos Other assets have been brought into the Ethereum ecosystem. In the expansion stage of the ecosystem, these measures are also attempts to apply different possibilities to the public chain. At this stage, it has played a positive role in the popularity of the project and the participation of users.

From the above data, we can see that, as the second largest public chain in terms of market capitalization, ETH has the lowest proportion among large currency holders, that is, the highest degree of decentralization. And Tezos' token XTZ also has a good performance in decentralization, at least better than the decentralization of Cosmos and Tezos, which are also rising stars. At present, the dynamic pledge rate of both Tezos and Cosmos is maintained at a relatively high level, but if the newly produced tokens do not have a better consensus value support, they will face greater selling pressure. The higher the ratio of newly issued tokens to the existing non-pledged circulating tokens, the more likely it will have an impact on market circulating tokens.

This article is part of the partnership between LongHash and the Tezos Foundation, but the views expressed in this article do not necessarily represent those of the Tezos Foundation.

This article is part of the partnership between LongHash and the Tezos Foundation, but the views expressed in this article do not necessarily represent those of the Tezos Foundation.

LongHash, Use data to understand the blockchain.