Is Hive decentralized and who governs it? Episode 2
Remember, one month ago, I published a post about Hive and how decentralized its governance could be. You can read it here.
In this post, it was clear that, compare to Steem, the dominance of the whales on Hive was already strongly weakened, leaving place to more potential influence from a middle class of dolphins and orcas.
What about delegation?
Quite judiciously, on one of my Hive Stats post about Hive, @blocktrades asked me the following question:
A question about the cumulative hive power per level graph: Is it looking at raw or effective MVESTS of an account when measuring active/inactive totals? I think it should account for delegated power. For example, if an account is inactive, but delegating to an active account, I think those VESTS should be considered active.
Indeed, in my stats post as in my previous post about governance, my analysis and the graphics presented did not take into account any delegation of Hive Power, given or received.
So let's first give a look a the actual stake distribution without delegations:
Dolphins and orcas still have combined Hive Power of 47.98%, which is more than the 36.93% of all whales.
Now, let's give a look at how Hive Power distribution with delegations change these numbers:
Oh oh, there is a big surprise here: the very middle class of Dolphins have now more power than Whales. And combined with Orcas, they have a full majority of 55,39%. What good to see is that redfishes also make a jump from 5.36% to 9.01%. To me, this means that the more powerful users are doing their job of helping newcomers properly by delegating Hive Power to them so they can be active on the blockchain.
So, is Hive really decentralized?
Not only did my previous post showed that Hive became more decentralized than Steem, but these new figures clearly reinforce that feeling, for the better.
We have a strong community of power users and investors who actively support other users who are also involved in the blockchain activity.
In my opinion, this is very good news
Share your thoughts!
So, is finally Hive decentralized enough to you?
I'm eager to read your comments!
Nice analysis.
First time I've seen figures taking into account the impact of delegations.
Of course delegations are not relevant for governance purposes.
True, but it has a significant impact on how the rewards pool is distributed, which, from an economic perspective, is part of the governance.
This is very good to see, indeed! Thank you for doing the math for us and presenting the info in such a clear and concise way! 🙌
Thank you for your feedback @thekittygirl
This is interesting, some whales that are sleeping are dolphins hahaha.
This makes me happy - we need even more decentralization !!!
This might be a candidate for a separate monthly report. It looks like a good measurement to see where we are going with respect to decentralization.
I'm saying monthly because I suspect weekly changes are not that drastic.
No need to wait each week or month, I have updated my daily stats with these new numbers/graphs. 😉
I feel like we are drowning in daily Hive stats talking about Hive things. It seems to me that for most data points weekly reports would be sufficient.
Holy shit!
Dolphin power! 🐬🐬🐬🐬🐬
thanks for sharing!
It is.
However, it is not over. Decentralization is a journey, and centralization incessantly waits in the wings even when it has not succeeded at capturing the economy. Steem reveals the ultimate fate of economies that fail to maintain decentralization, and that once centralized, it is difficult to even conceive of how to decentralize them.
While delegations reveal support for the middle and lower class, it is ownership of stake that informs governance, and that cannot be delegated.
I must remain liable to being labeled impossible to satisfy regarding decentralization as long as the very real threat of the hazards of centralization via governance remain. I do agree that the revealed delegation is good, but must continue to recommend more of the same, and mitigation of the hazard to governance of the Golden Rule.
If Hive is to succeed at enabling society to distribute wealth, actually being a tide that floats all boats, it must resist the unction of legacy financial economics, and continue the path of improved distribution revealed by the data you share today. I do not foresee being free of the threat of centralization becoming a certainty any time soon, and can but be glad we yet have not succumbed.
Let's keep doing that.
Thanks!
I mostly agree with all your points, although I think the risk of a centralized takover will not be high in the near term, once the delayed stake voting is deployed, which removes the highest risk of a centralization attack via rapid custodial stake voting.
On a related note, my original question wasn't meant to identify any "increased decentralization". I just thought the original data showed too much whale stake as "inactive" which seemed suspect to me, as it does provide a pretty reasonable rate of return versus other investments right now, so I thought it unlikely that it wasn't being used to curate. And my theory, which is now well supported by the data, is that whale stake is in fact largely active, it's just via delegations rather than direct voting.
It appears you were quite correct.
I still feel witness votes needs to be addressed before we are more decentralized then steem was.
How many per account (30 still, why not 5?)
Required refresh of witness votes (fall off after a certain time, inactive accounts)
But the HP being delegated around like that is really good to see, positive step forward.
We propose one witness vote per account. Also suggest that hive inflation should be contained to what is promised in white paper. Currently it is ~20-25%
Defining the best number of witnesses you can vote for (with full stake) is not an easy task. I invite you to read this interesting analysis from @raycoms.
One voting scheme he did not include in his analysis is "infinite witness votes with stake spread", i.e. you can vote for as many witnesses as you want but your voting power is spread among them. It would be interesting to see how it impact the current witness ranking.
Requiring votes refresh is cumbersome and would lead to witnesses permanently campaigning.
On the other hand, removing/decaying votes from inactive accounts is an idea I already talked about.
infinite witness votes with stake spread is the same as 1 vote per account assuming 1 account per 1HP. So it is practically the same as 1 account 1 vote (from an analytic point of view)
Nice analysis and very good post. Thanks for sharing
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Thank you @stefano.massari
It is good analysis but critical analysis about how whales still control the governance is missing. One account can vote for 30 witnesses and that is the biggest flaw in Hive/Steem governance model. It should be gradually diluted to one account -one witness vote.
Great info, you are helping me understand how things work here.
Much appreciated
Glad you found this post helpful to you @farm-mom
Yes, I think Hive is enough decentralized, I call it The New World 😇
Have a nice end of week.
Thank you @misschance
Interesting stats. There is no perfect system, but I think we are on a good path with Hive. Of course there are accounts like haejin who is powering down, but still has a big delegation from rancho (who appeared to post on another account saying he had lost control of the big one). I think the basis of the platform is sound and what we need is far more users with some of them investing in Hive. That will help spread the votes better. Any whales who choose to stick around will remain powerful for the duration and some will keep causing trouble just because they can.
On the witness front we need to encourage more people to use and review their votes. Some inactive witnesses still have lots of votes.
Hello @arcange,
Very interesting statistical analysis on the distribution of voting power. But in praxis I think that it is still far from decentralized governance. I see a kind of oligarchy, it is not necessarily good or bad, it will depend on the interests and commitment of everyone who participates in Hive.