Gavin Wood, the co-founder of Ethereum and founder of Polkadot, recently proposed five key criteria for evaluating the potential of blockchain. He claimed that Polkadot has the best resilience and decentralization, surpassing Ethereum and Solana, but it also has a tendency to boast.
(Previous summary: Polkadot founder Gavin Wood decides to become a DJ amid a 50% drop in Polkadot?)
(Background information: Burning $87 million in six months with no highlights! Polkadot’s latest financial report sparks controversy: ineffective governance and discrimination against Asians..)
Ethereum has been struggling in this market cycle and has not been able to surpass its all-time high of $4,891 in 2021. This week, it even fell below the $2,100 mark. On the other hand, Solana, which plunged into the abyss after the FTX crash in 2022, briefly surged to nearly $300 last month, setting a new all-time high.
Gavin Wood’s Five Criteria for Evaluating Blockchain
What factors determine the long-term success of a blockchain? Gavin Wood, the co-founder of Ethereum and founder of Polkadot, who first introduced the concept of Web3, recently discussed this in an interview with Forbes. He proposed five basic criteria for evaluating the potential of blockchain:
Resilience: As the cornerstone of Web3, resilience combines cryptography, decentralization, and game theory with the aim of protecting the blockchain from attacks and ensuring its long-term stability.
Performance: This measures not only scalability but also the efficiency of a network in processing and completing tasks.
Generality: The degree to which a blockchain supports diverse applications and programmability.
Accessibility: The ease of interaction between users, developers, applications, and robots with the network.
Consistency: The ability of a system to maintain rapid and consistent communication throughout the network.
Gavin Wood analyzed that although different blockchains emphasize different characteristics, the “resilience” criterion should never be overlooked. It is the most difficult to evaluate, the most long-term, and the most crucial. Blockchains that ignore decentralization and resilience should not be considered true Web3 platforms.
For example, L2 chains on Ethereum have a fixed list of validators operated by specific companies, which clearly does not align with the spirit of Web3.
He also mentioned more ambiguous concepts, such as whether there is a single entity that can dominate the narrative and “fundamentally cover the entire ecosystem, stifling other narratives.”
Is Polkadot more decentralized than Ethereum and Solana?
Gavin Wood stated that to assess the resilience of a blockchain, it is usually evaluated based on its degree of decentralization. Factors considered include who makes protocol decisions and whether governance has clear or lower entry barriers. The Nakamoto Coefficient is also taken into account. This coefficient measures the number of nodes that need to be controlled in order to disrupt a blockchain network. The smaller the number, the fewer entities need to be controlled to disrupt the network, indicating a higher degree of decentralization.
Gavin Wood is satisfied with the level of decentralization in Polkadot and cites the Nakamoto Coefficient as evidence. According to Nakaflow data, Polkadot currently has a Nakamoto Coefficient of 149, which means that at least 149 independent validators need to collude to disrupt the network.
In comparison, other major blockchains have much lower values. For example, Solana has a coefficient of 19, and Ethereum only has 2.
Is Ethereum really that insecure?
However, after conducting investigations, it was found that Nakaflow data did not analyze Ethereum. In a typical POS network, controlling over one-third (33.33%) of the stake is sufficient to disrupt the blockchain network. The 2 mentioned by Gavin Wood should be the percentage controlled by Lido and Coinbase, but both Lido and Coinbase provide convenient validation services for users, and the operation of the nodes behind them is more complex.
The official statement also indicates that it is difficult to calculate the Nakamoto Coefficient in practice because it is challenging to determine independent entities. Are seemingly separate entities actually related to each other? Can a seemingly independent entity be further divided into more entities? It is biased to judge the level of decentralization of Ethereum solely based on this.
Is Vitalik a greater risk?
The report also pointed out that if Gavin Wood’s resilience evaluation criteria are applied, Ethereum’s weaknesses become evident. Ethereum is often criticized for the excessive influence of co-founder Vitalik Buterin. In a recent tweet, he claimed, “I am the one who decides the leadership team of the new Ethereum Foundation,” which has sparked controversy.
However, compared to Ethereum, the performance of Polkadot’s mainnet token DOT is even less ideal. According to CoinMarketCap data, the price of DOT is currently $4.72, which is a decrease of over 91% from its all-time high of $55 in 2021. In comparison, Ethereum has experienced a decline of 43.66% from its peak in 2021.
