Using number of validators to measure a networks decentralization is a good place to start, however there is still far more than just the # which should be considered. I will give you an example. If Oasis were to increase the validator count from 120 to 200 validators, but Binance set up 80 new validators and delegated their current stake to all those validators with no one else delegating they would still be in the top 200 for all of the validators. The effect would be that the network has increased the number of validators by 66.6% but not gained any decentralization at all since there is still the same amount staked in the network and no new entities joined the validation pool. At the same time though we would have increased the number of redundancies that must be performed in each block which would hurt the ability of the network to scale. The end result would be the same decentralization and a less efficient network. Now obviously this is a contrived example, but I think it is a fair one which demonstrates that simply measuring the number of validators to evaluate decentralization is not enough. In ETH 1.0 for example there were countless validators, but a cartel of mining pools ran the majority of those validators. Just because they were running many validators did not necessarily mean they were increasing decentralization at all. There are decreasing marginal returns for increasing the validator pool size. After the last increase from 110 to 120 the newly established 10 validators accounted for less than 1% of the total stake in the network meaning they contributed very little decentralization. They have increased a good amount since then so perhaps it is worth submitting another governance proposal to increase from 120 to 130, but if we for example went to a committee size of 200 it is likely that the bottom half of those validators would have little to no effect on decentralization, but would definitely be wasteful and make the network less efficient.
Categories: Staking, Tokens