Comparison of Decentralization in DPoS and PoW Blockchains
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Decentralization is a key indicator for the evaluation of public blockchains. While existing works have evaluated the degree of decentralization in Proof-of-Work (PoW) blockchains represented by Bitcoin and Ethereum, there have been few studies on measuring the actual level of decentralization between PoW blockchains and blockchains powered by other decentralized consensus protocols. This paper presents a comparison study of the level of decentralization in Bitcoin and Steem, a leading Delegated-Proof-of-Stake (DPoS) blockchain. In Bitcoin, miners with higher computational power generate more blocks. In contrast, blocks in Steem are equally generated by witnesses while witnesses are periodically elected by stakeholders. Our study analyzes the process of stake-weighted election of witnesses in the DPoS consensus protocol and measures the actual stake invested by each stakeholder in Steem. We then quantify and compare the actual degree of decentralization in these two blockchains by computing the Shannon entropy of the distribution of computational power among miners in Bitcoin and the distribution of invested stake among stakeholders in Steem. Our measurements indicate that, compared with Steem, Bitcoin tends to be more decentralized among top miners but less decentralized in general. Our study is designed to provide insights into the current state of the degree of decentralization in representative DPoS and PoW blockchains. We believe that the methodologies and findings in this paper can facilitate future studies of decentralization in other blockchain systems employing different consensus protocols.
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