Summary
LUNA Classic (LUNC) Validator’s voting power is imbalanced. As of December 19, 2022, at 2:43pm CST the top 5 validators possess 47.44% of the blockchain voting power; The top 10 validators possess 70.74% of the voting power and the top 20 validators possess 86.46% of the voting power. LUNC Classic has 130 total validators.
Set the maximum voting power a LUNC Validator may reach to 10% of the total voting power.
Motivation
Increase the decentralization of LUNC Blockchain Validator’s voting power. Current voting imbalance has the potential to allow the passage of proposals not beneficial for the decentralization of the LUNC blockchain. In fact, it has the potential to enable the passage of proposals allowing the misappropriation of funds; improper centralization of the blockchain and the likes.
PROPOSAL
Purpose
Increase the decentralization of LUNC Validator’s voting power.
Problem
LUNC Validator’s voting power is imbalanced. This has the potential to allow the passage of proposals not beneficial for the decentralization of the LUNC blockchain. In fact, it has the potential to enable the passage of proposals allowing the misappropriation of funds; improper centralization of the blockchain and the likes.
As of December 19, 2022, at 2:43pm CST the top 5 validators possess 47.44% of the blockchain voting power; The top 10 validators possess 70.74% of the voting power and the top 20 validators possess 86.46% of the voting power. LUNC Classic has 130 total validators.
Solution
Set the maximum voting power a LUNC Validator may reach to 10% of the total voting power. Practically speaking, this decreases a small number of validators from solely deciding or controlling the passage of governance proposals. Thus, helping to spread the voting power over the many oppose to the few validators. This helps improve the LUNC Nakamoto Coefficient (see below). No validator will possess more than 10% of total voting power for the LUNC Blockchain.
Process
Any validator that reaches the maximum 10% of the total voting power, all remaining voting power over 10% will be then equally redistributed to the remaining active validators that possess less than 10% of the total LUNC validator voting power. No current or future non active validator will share the redistributed voting power. Any validator that becomes non active post redistribution will lose the redistributed voting power which will then be equally redistributed, as above, among all active validators.
CURRENT NAKAMOTO COEFFICIENTS
A high coefficient means that a blockchain is harder to disrupt, because it’s more decentralized.
- Luna Classic has a Nakamoto Coefficient of 9.
- Luna Nakamto Coefficient of 57.
- Bitcoin has had a Nakamoto Coefficient as high as 7,454 if not higher.
Source
Terra Classic Aura Stake. https://terra-classic.aurastake.com
APPENDIX
Nakamoto Coefficient: Indicator for Blockchain Decentralization
The Nakamoto coefficient measures decentralization and represents the minimum number of nodes required to disrupt the blockchain’s network. A high Nakamoto coefficient means that a blockchain is more decentralized.
Quantifying Decentralization