Node Operators Over Time

    This dashboard looks at the number of unique THORChain node operators bonding RUNE for the first time and what factors could play into when new node operators decide to go live.

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    What are Node Operators?

    Node operators on the THORChain network are responsible for running the software that keeps the network going. They have to create vaults for storing assets, construct the blockchain, witness transactions, and sign outgoing transactions. To create a new node, a node operator must also bond at least 1,000,000 RUNE. In exchange for this investment and their services, nodes are rewarded in RUNE. The more nodes that are active, the less each receives, assuming all else stays equal.

    The weekly number of unique nodes bonding RUNE for the first time saw heavy volume from April 2021 to the beginning of July 2021, and sharply fell off after the network shutdown in the summer of 2021. This signifies a decreased interest as of late to become a node operator, which could be in part due to decreased faith in THORChain after the shutdown. Another factor to consider is that the more node operators there are, the higher a possibility of decreased rewards, so there may be a decrease in new node operators due to a decrease in percentage yield. I decided to look next at the rewards each node was receiving over time.

    Another factor that could affect the number of new operators is the price of RUNE, although there does not seem to be a significant correlation between the price of RUNE and new node operators. When the price of RUNE increased to its ATH on May 10th, 2021, there was actually an inverse correlation with the number of new node operators.

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    There does not seem to be a significant correlation between the weekly rewards per node and the number of new nodes created. The weekly rewards reached their peak on November 1st, 2021, where each validator received an average of $33,000, yet there was not a significant increase in new nodes around this time. The least weekly rewards were around April of 2021, and a relatively high number of new nodes were still created during this time.

    Conlusion

    There was a large number of unique nodes bonding RUNE for the first time from April 2021 to the beginning of July 2021, although this number has significantly decreased since the network shutdown in the summer of 2021. There does not seem to be significant correlation between new node creation and either the price of RUNE or node rewards, so the decrease in new node creation may be the result of diminished faith in the platform in the wake of the shutdown.