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The detailed analysis about validators and delegators of Terra blockchain is provided in this dashboard.
Introduction:
Terra's core network, Columbus-4, is a public blockchain based on proof of stock. This means that the magnitude of the impact of each affirmative vote depends on the amount of Luna tokens he has secured as collateral. These tokens can be tagged directly by the validators or represented by the Luna holders to the validators.
In the Terra Consensus model, Luna holders do not stake their tokens directly, but instead represent their tokens to the validators. So holders who want to use the staking bonus but do not want to run a full node can make money by being called a delegator.
The effect of each validator vote depends on the amount of tokens he has staked. These tokens either belong to him or to him through delegators. According to the consensus algorithm used in the Terra protocol, only the top 100 validators in terms of their token-staked volume will be placed in the final verifiers. Therefore, the main and important role of the delegators is to identify the right validator and leave their token to him to stake.
Being selected as a confirmer is a big responsibility in the Terra ecosystem. Because only the top 100 validators will be able to sign the blocks.
Outline of previous works:
In this section, a comprehensive summary is provided regarding the validators and the delegators. This conclusion has been made by examining all the questions validators and delegators in the previous bounties. In the following, we gathered the achievements related to each of the bounties.
1- Clustering validators by size of staked Luna: One of the important indicators to evaluate the performance of validators is to calculate the amount of tokens staked in them. Based on this index, the validators of the Terra collection are grouped according to the size of the stake. This is a very practical method for users of this ecosystem to get acquainted with each of the validators.
2- Reward analysis: The main purpose of Luna token is to secure the network by staking it and locking value in the ecosystem. However, those who hold the Luna currency for a long time are at risk of fluctuations in this asset. That's why Luna staking Rewards is the main incentive for holders who intend to have this currency in their portfolio for a long time.
Because validators provide the computing power of the Terra protocol, rewards are distributed among them first. After that, each Delegator receives his share. Staking rewards are determined by the volume of the staked Luna, and the structure is designed so that as the number of transactions on the network increases, so do the rewards. Therefore, with the growth of the Terra network in the long run, investing in this currency code will be profitable.
3- Distribution of Luna delegation among validators: In this metric, we want to talk about the distribution of Luna's delegation among validators. As we know, the delegators are the representatives who stake Luna in the creditors. Therefore, the choice related to the delegators is an essential parameter for the selection of the validator because those delegators have more comprehensive information on the intended validator.
4- Delegation, undelegation and redelegation: For each validator, the amount of delegated, undelegated and redelegated Luna are very sensitive and vital parameters, so the information related to this parameter in recent months can help users in choosing the proper validator.
5- Airdrops: Airdrop represents the essential part of the staking APY. Therefore, the number of airdrops claimed and the dollar value of them are very important parameter in selecting the appropriate validator. Because the efficiency of the desired validator is strongly dependent on this parameter.
6- Voting power: As mentioned, the voting power of each validator depends on the amount of staked Luna by it. Therefore, this old index is always considered by users, because the main component is the same amount of Luna tokens, and this is the first thing that new users look at.
Selected metrics:
According to the study related to the background work related to the validators, in this section, three important and vital indicators related to the selection of the validators are presented. These three indicators were selected based on previous experiences and greater efficiency and popularity among users.
2. Reward analysis
Reward-related analysis for each of the validators is provided in this section. As mentioned in the previous section, the distribution of rewards is one of the important criteria for choosing a validator, because powerful validators use these rewards simultaneously due to its distribution among the delegators and users.
3. Luna per delegator (Whales or normal users delegate to validator?)
In the third part, we have introduced an indicator called stake providers behavior. According to this index, we will say whether the users of the stake behave like a whale or a normal user. To obtain this criterion, the number of delegators as well as the stake volume of each is obtained and by dividing the volume obtained by the number of delegators, it is determined. By the use of this index, whether the delegator and the intended users behave like whales or are normal users. According to this criterion, new users in the Terra blockchain can make a good decision regarding the selection of the desired validator for the stake.
As shown in the first bar-chart, the bit-cat validator is mostly used by whales because staked Luna per delegator is near 40 Luna and this validator is in the first place.
The second chart demonstrates the validators which used by ordinary users. As shown in this chart, Protoss one has the lowest Luna per delegator with 0.001 Luna.
This metric could be used by newcomers on Terra blockchain to evaluate the application of each validator by characteristics of delegators.