By Connor Smith

Note: This is the fifth installment of a series detailing different approaches that blockchain networks have taken to decentralize their network. Part 1 introduced the concept of decentralization and the inter-play it has with certain aspects of crypto networks like governance, incentives, and network architecture. If you missed that article I highly recommend going back and reading it here. The subsequent articles have been examinations of the decentralization on Bitcoin, Factom, & Cosmos. If you missed those and would like to go back and read them before we dive into Terra, you may do so, here, here, & here respectively.

Hey everybody, and welcome back! Last week, we dove into our first proof-of-stake network, Cosmos, and analyzed how it has approached decentralization in its quest to build the ‘Internet of Blockchains’. In addition to assessing how decentralization has worked thus far on Cosmos, we also got into the nuts and bolts of how the underlying technologies supporting its ecosystem of interconnected, application specific blockchains (Tendermint BFT, ABCI, & IBC) work, and the modular network design of Cosmos with hubs and zones. This week, I will be picking up right where we left off and analyzing one of the networks building on top of Cosmos that is seeing major real world use and adoption, Terra. 

Terra aims to provide a price stable cryptocurrency, built on top of the Cosmos SDK, that will function as the infrastructure layer for decentralized financial applications. The protocol utilizes an elastic monetary supply that allows for both a stable price and the censorship resistant capabilities of Bitcoin to be maintained, enabling it to be used in everyday transactions. Currently, Terra is the backend technology powering CHAI, a mobile payments application that allows users to link their bank accounts and participate in ecommerce using Terra’s currency and receiving discounts in exchange. 

Terra is currently backed by South Korean internet giant Kakao and integrated with over 10 e-commerce platforms in Southeast Asia. The platform has seen rapid growth since launching last April, having just reached over 1,000,000 users last week, and continues to grow. With so many cryptocurrencies struggling to break into the commercial sector and seemingly every new year being the year we will finally start to see adoption, this is certainly no trivial feet. So now, without further ado, let’s dive into Terra and see how this network has approached decentralization on their quest to become the largest payments platform in Asia!

So What is Terra and How Does it Work?

Before we dive into the technical underpinning of Terra, the problem it solves, and its approach to doing so, it will help to first have some context regarding the rather unconventional background of its founders and some of the history leading up to its launch. Work on the project commenced in April of 2018, led by co-founders Daniel Shin and Do Kwon. Kwon had previously worked as a software engineer at Apple and Microsoft, in addition to being founder and CEO of a startup called Anyfi that attempted to use peer-to-peer mesh networks to try and create a new, decentralized internet. Shin was a successful serial entrepreneur, having built and sold multiple e-commerce companies in East Asia, and, at the time, was CEO of his most recent startup, TicketMonster, the leading e-commerce platform in Korea. Leveraging their extensive backgrounds in e-commerce and distributed systems, the pair sought to create a modern financial system built on-top of a blockchain that could be used by people to make everyday payments. The two believed that the major roadblocks to adopting cryptocurrencies largely stemmed from the extreme price volatility and lack of a clear path to adoption that most networks exhibited. Thus, they designed Terra to be a price-stable, growth-driven cryptocurrency that was focused on real world adoption from day one. Leveraging Shin’s deep connections in e-commerce, they formed a consortium of e-commerce companies known as the Terra Alliance. Within a few months of launching, 15 Asian e-commerce platforms had joined that represented a total of $25 Billion in annual transaction volume and 40 million customers. This coincided with a $32 million seed round investment the team raised from some of the world’s largest crypto exchanges and top crypto investment firms. Having a war-chest of funding in place and real world partnerships aligned, the team was off to the races as they started building the project and integrating it with e-commerce platforms.

Seeing as Bitcoin launched over a decade ago as a peer-to-peer electronic cash system, you may be wondering why a protocol like Terra was still tackling the issue of digital payments. This is largely because Bitcoin and other cryptocurrencies exhibit significant price volatility, making consumers nervous whether it will maintain its value when they try to transact with it later. For perspective, Crypto markets can fluctuate 10% or more in either direction on any given day, and in late 2017 Bitcoin was trading at nearly $20,000/BTC and less than two months later was trading between $6000 – $9000 (at the time of writing this article Bitcoin is trading at $8415.65). Terra, was far from being the first or only project to realize that price volatility posed a significant barrier to crypto adoption. Attempts at creating a price-stable cryptocurrency, or stablecoin, date back as far 2014 with BitShares, and have proliferated at a momentous rate in the wake of the volatility exhibited in the last crypto bull market in late 2017. 

Stablecoins are exactly what their name suggests, a cryptocurrency designed to be highly price-stable in respect to some reference point or asset and maintain the following three functions of money: a store of value, a unit of account, and a medium of exchange. While this sounds fairly intuitive and straightforward, the engineering behind these instruments is quite difficult with no agreed upon approach. Cornell University attempted to codify the different approaches some networks are taking, and put forth a paper classifying the different design frameworks for stablecoins, which can be found here. The finer nuances and mechanics of each approach exceed the scope of this article, but the study revealed that most stablecoins maintain price using one of the following mechanisms: a reserve of pegged/collateralized coins or assets, a dual coin design, or algorithmically. 

Maintaining a reserve of a pegged or collateralized asset allows the organization controlling the stablecoin to maintain price by incentivizing users to expand or contract the supply until it returns to its pegged price. Users are able to earn money by expanding the supply when the price is high and redeeming when it is low through arbitrage until the opportunity disappears and the price has equilibrated. The dual coin approach is where a network implements a two token system in which one coin is designed to absorb the volatility of the first through a process known as seigniorage. This is where the secondary coin is auctioned in exchange for the stable coin if it dips below the peg and the proceeds are burned to contract the supply and stabilize the price. Conversely, if the price of the stablecoin is above that of the peg, new coins will be minted to those holding the secondary coin to expand the supply and level the price. Lastly, the algorithmic approach uses complex algorithms and quantitative financial techniques to adjust the currency price as needed without any backing of pegged or collateralized assets. Hence, it behaves analogously to a traditional cryptocurrency in the sense that a user’s balance and outstanding payments vary proportionately with changes in the market cap of the coin, but it provides a more stable unit of account. 

Terra utilizes a dual coin approach in which the transactional currency, Terra, represents an ecosystem of cryptocurrencies pegged to real currencies like USD, EUR, KRW and the IMF SDR, and Luna is the secondary coin that absorbs the volatility.  All of the Terra sub-currencies (TerraKRW, TerraUSD, etc.) can be swapped between one another instantly at the effective exchange rate for that currency pair, allowing the network to maintain high liquidity. Since the prices of these fiat currencies are unknown to the blockchain natively, a network of decentralized price oracles are used to approximate the true value of the exchange. Oracles, in this context, are essentially trusted data sources that broadcast pricing data generated from currency exchanges onto the network. They vote on what they believe the true price of the fiat currencies to be, and, so long as they are within one standard deviation of the true price, are rewarded in some amount of Terra for their service. Should the price of Terra deviate from its peg, the money supply is contracted or expanded as needed using a seigniorage method similar to that described above. Hence, oracles mining Terra transactions absorb the short Term costs of contracting the supply and gain from increased mining rewards in the mid to long term. 

Luna and the Critical Role is has in the Tokenomics & Governance of Terra

However, since Terra is a proof-of-stake network, oracles must have stake in the network in order to be able to mine Terra transactions. This is where the second token, Luna, comes in. Luna is the native currency of the protocol that represents the mining power of the network, and what miners stake in order to be elected to produce blocks. Luna also plays a critical role in defending against Terra price fluctuations by allowing the system to make the price for Terra by agreeing to be a counterparty for anyone looking to swap Terra and Luna at the exchange rate. In other words, if the price of TerraSDR << 1 SDR, arbitrageurs can send 1 TerraSDR to the system for 1 Luna and vice versa. Thus, miners can benefit financially from risk-free arbitrage opportunities and the network is able to maintain an equilibrium around the target exchange rate of Terra irrespective of market conditions. Luna is also minted to match offers for Terra, allowing for any volatility in the price of Terra to be absorbed from Terra into the Luna supply. In addition to the transaction fees validators collect from producing blocks, the network also will automatically scale seigniorage by burning Luna as demand for Terra increases. As Luna is burned, mining power becomes scarcer and the price of Luna should theoretically increase. This scales with the transaction volume and demand on the network, allowing miners to earn predictable rewards in all economic conditions.

In the most recent update for the protocol (Columbus-3) on December 13, 2019, Luna gained even more utility in the Terra ecosystem by allowing its holders to participate in on-chain governance. Luna holders can now submit proposals for parameter or monetary policy changes to the network as well as make general text proposals and request funds from the community pool (a portion of the seigniorage tokens available to fund community initiatives). If a proposal receives a super majority of supporting votes, the proposal will be ratified and changes made. Not only does this extend to the functionality of Luna, but it also opens up the user base of individuals who can actively participate in the network. Before the Columbus-3 update, Luna only added value to miners on the network, but now anyone can purchase Luna and use it to participate in governance. Moreover, Luna transactions are tax free so it is even easier for non-miners to acquire to participate on the network. 

Terra also has a governmental body known as the Treasury that is designed to allocate resources from seigniorage to decentralized applications (dApps) being built on top of the platform. After registering as an entity on the Terra Network, a dApp can make a proposal to the Treasury for funding, and Luna Validators may then then vote on whether to accept or reject the application based on its economic activity and use of funding. Should the application receive more than ⅓   of the of the total available Luna validating power, it will be accepted and the Treasury will allow the dApp to open an account and receive funding based on the proportional vote it received from Luna validators. The Treasury ultimately determines how funds are allocated to dApps, but, if the community feels the firm is not delivering results, validators can vote to blacklist the dApp. Ultimately, this tiered governance structure is designed to provide Luna holders with a way to determine what proposals and organizations receive funding based on the highest net impact it will have on the Terra economy.

So How Decentralized is Terra?

As of writing this article, there are currently 61 validators located around the world on the Terra Columbus 3 mainnet (We at Consensus Networks are on this list and have been active validators since Terra first launched this past April!). While only about ⅓ of the size of the number of validators on its parent network, Cosmos, this is still a fairly impressive degree of physical decentralization when considering Terra underwent a fully decentralized launch and has been concentrating on integrating with e-commerce platforms exclusively in Southeast Asia. However, as of the writing of this article, the top 9 validators control 62.8% of the voting power on the network. So, similar to what was observed last week with Cosmos, a very small handful of network participants control the majority of economic and governance resources.

However, what is less clear, is if this centralization of resources has as significant of consequences on a growth focused stablecoin network like Terra. For example, Seoul National University’s blockchain research group, Decipher, conducted an in depth study on Terra that concluded it exhibits much greater price stability than other popular stablecoins like USDC or USDT. Terra has also on-boarded 14 online e-commerce platforms and over 1,000,000 users onto its payments application, CHAI, resulting in over $130 million being processed by the network to date. They have also begun expanding outside of South Korea into areas like Mongolia and Singapore. Given that Terra’s mission was to be a price-stable cryptocurrency with a clear path to market, it objectively appears that they have been successful in their goal thus far (Especially when considering that the mainnet has been live for less than a year). With validators receiving rewards in two forms (transaction fees and Luna burn), Terra has created a rewards structure that is predictable under all economic conditions for validators, giving them little to gain from colluding in an attempt to undermine the network. 

Yet, the recent additions of on-chain governance in Columbus-3, Luna being listed on more exchanges, and Luna receiving a tax exempt status on transactions introduces new layers of complexity to the Terra ecosystem that could pose a threat to the decentralization of the network. Now, anyone can vote on proposals that affect Terra’s  future trajectory at both a governance and functional level. When considering that proposals on the network require a supermajority of votes to pass, the threat of collusion between a handful of parties controlling most of the resources now poses a much greater threat. For example, if the top 9 validators were to collude and try to pass a proposal that benefited them at the expense of the network, they would only need to acquire roughly 4% more of the voting power to reach the supermajority needed approve it and change the protocol at a functional level. Additionally, given Terra’s adoption-driven growth model, there are now a whole new range of stakeholders that must be factored into the ecosystem like e-commerce platforms and users of Terra-based applications. While still unclear how this will evolve over time, effectively anticipating and designing for these new dynamics is one of the primary focus areas of the team moving forward, as can be seen here

Given the major shifts in how the protocol operates and the massive influx of new stakeholders, it is far too early to speculate on how Terra’s approach to decentralization will proliferate into the future. Regardless, the fact remains that Terra’s adoption-driven approach to growth has made it one of the few cryptocurrencies that has started seeing demonstrable real world use to date. Having recently hired Uber’s former Head of Strategy, Rahul Abrol, to spearhead their international growth efforts, Terra and CHAI has a very realistic chance of achieving their goal of becoming the leading payments platform in Asia in the years to come. Thank you for reading, and I hope you enjoyed the article! Tune in next week as we explore the other massive project looking to create the internet of blockchains, Polkadot, and its Canary Network, Kusama! 

Note: This is the fourth installment of a series detailing the approaches that different blockchain networks have taken to decentralize their network. Part 1 introduced the concept of decentralization at a high level, the role it plays in crypto networks and some of the different factors inherent to a protocol that influence how decentralization will propagate at scale and influence participation. Parts 2 & 3 then provided in-depth looks at Bitcoin and the Factom Protocol in addition to their approaches to decentralization. If you missed any of these articles and would like a refresher before we dive into the decentralization of Cosmos, you may do so here, here, & here respectively.

Hello everyone and thanks for joining! Over the last few weeks, we have talked quite a bit about decentralization and the different mechanisms that blockchain networks use to influence participation and dispersion of their network participants. We took a nice trip down memory lane to examine Bitcoin’s approach over the last decade, followed by fellow veteran protocol Factom. In this week’s article, we’ll dive into Cosmos, the first Proof-of-Stake (POS) protocol in our series. While conceptualized as a white paper since 2016, Cosmos was just launched on March 13, 2019. The full history leading up to this event is too long to recount in this article, but I highly recommend checking it out here, as it involves some cool blockchain history. For example, one of the organizations behind the Cosmos Network, the Interchain Foundation (ICF), raised nearly $17 million in 30 minutes for the project via an ICO and it is regarded as one of the most successful fundraising events for a blockchain-related project ever. Cosmos may be slightly less than a year in age, but it is certainly one of the most ambitious blockchain projects to emerge thus far. Cosmos is creating what many have termed the ‘Internet of Blockchains’ or ‘Blockchain 3.0’, which is an ecosystem of interconnected blockchain protocols that are interoperable and can seamlessly communicate with one another. 

What is Cosmos and How Does it Work?

Beginning with Ethereum in 2014, developers started experimenting with ways to implement Bitcoin’s underlying blockchain technology into other applications outside of digital money. Specifically, many were interested in using blockchain for stateful applications that could handle more robust computer logic rather than a stateless ledger. This led to innovations like smart contracts and gave rise to the notion of decentralized applications (dApps). As developers started exploring new uses for blockchain technology an explosion of new, highly-specific crypto networks ensued. Consequently, people began to realize that one of two things was going to happen if the decentralized web was going to work: One school of thought was that everything would resolve to one or a handful of ‘fat protocols’ capable of handling all the compute needs of the different applications built on top of them with universally agreeable tokenomics. The opposing view was that there would be a myriad of different blockchains, some application-specific and others comprehensive, that would be interoperable with one another so people could transact across them as needed. 

Cosmos was birthed out of the latter ideology and is essentially applying a microservices architecture to create a base-layer network that connects an ecosystem of application-specific blockchains. To achieve this goal, the teams working on Cosmos decouple the different components of blockchain networks (consensus, networking, & the application) and provide them piecewise in a ‘plug-n-play’ fashion to the protocols building their blockchains on top of Cosmos. Hence, Cosmos, while a blockchain protocol in-itself, acts as a platform wherein other blockchains can be built using a suite of customizable, shared technologies and Cosmos handles properly managing state and transactions across the different sub-networks.

The first component that makes this possible is the Tendermint  BFT Consensus Engine. Tendermint BFT is an open-source technology that combines the networking and consensus layers of blockchains into a generic byzantine fault-tolerant ‘consensus engine’ that can easily be plugged into any application to create a proof-of-stake blockchain. Being byzantine fault tolerant means that up to ⅓  of the nodes in the network can arbitrarily fail or be overcome by a malicious actor, yet it will still operate as intended. If you would like more information regarding byzantine fault-tolerance or the byzantine generals problem, the original paper on the topic is available here. Proof-of-stake is an alternative consensus mechanism to proof-of-work that replaces mining with the notion of skin in the game via stake, or the amount of a network’s cryptocurrency a user owns and invests into the protocol. The larger a participant’s stake, the more likely that participant is to be elected to produce blocks and be rewarded. This is analogous to the relationship between a Bitcoin miner’s investment in computing power and his or her likelihood of mining a block, but requires significantly fewer computational resources and allows for faster transaction times. Tendermint founder Jae Kwon was actually the first person to prove and demonstrate that byzantine fault tolerance worked for proof-of-stake networks, so for more information, I invite you to check out the paper he released on the matter here.

Tendermint BFT allows developers to save time and effort setting up the networking and consensus components of their proof-of-stake networks so that they can instead focus almost singularly on the application layer. Moreover, Tendermint BFT is language agnostic and has clients in Golang, Javascript, Rust, & other popular programming languages, allowing developers to build their blockchain on top of Cosmos with ease. The engine then communicates with the application layer through a socket protocol known as the Application Blockchain Interface (ABCI) as may be viewed below.

Cosmos also provides blockchains building on top of it with a generalized application development framework (the Cosmos SDK), that makes building secure applications on top of Tendermint BFT using ABCI much easier and quicker. The SDK comes with a set of pre-built modules that allow developers to build applications without having to code everything from scratch with built-in security and separation of concerns. Hence, they simply use the components they need and can accelerate the time it takes for them to launch their blockchain. 

Once a developer has launched their application-specific blockchain, he or she can then communicate and transact with other blockchains in the Cosmos ecosystem via the Inter-Blockchain Communication Protocol (IBC). Each chain in the Cosmos ecosystem is heterogeneous, meaning that they all have fast-finality consensus provided by Tendermint BFT and their own set of Validators, differing only in how they implement these components. Validators are the node operators in Proof-of-Stake networks, like Cosmos, who are responsible for participating in consensus, producing blocks, and governing the network. Anyone can set up a validator and compete to be in the active set or subset, of validators selected to participate in consensus. Before launch, a proof-of-stake network will determine how large it wants its active set to be and then validators fill that set based on the magnitude of their stake after launch. Cosmos’s consensus mechanism then selects participants probabilistically based on the amount of stake they have relative to the other validators to solve blocks and be rewarded. Validators can also suggest and vote on governance proposals for the network. Users on the network who lack the funds or stake required to be in the active set may instead stake their funds with a validator in the active set and receive a share of the rewards that a validator receives proportional to the amount they have staked minus a fee cut from the validator.

Each application-specific blockchain represents a zone, which then connects to a hub (in this case Cosmos) via IBC connections. The Cosmos Hub is specifically designed to serve as the connection point for all of the applications, or zones, built within its ecosystem and carry out seamless transfers between them via the IBC, as seen below:

Cosmos has designed its ecosystem such that there can eventually be multiple hubs connected via IBC so that the network can continue to operate at thousands of transactions per second at scale. Additionally, they plan to incorporate Peg Zones, or blockchains, whose sole responsibility is to track the state of another chain. This Peg Zone will serve as a bridge to other non-Tendermint networks like Ethereum or Bitcoin and allow them to communicate with Cosmos via IBC. Hence, the end vision for Cosmos is an ecosystem of interconnected blockchains that looks as follows:

Governance on Cosmos

Cosmos was designed with a tiered governance structure that is open to the entire community but leaves ultimate voting responsibility within the hands of those supporting the network (i.e the validators). There is a constitution that states how Cosmos is governed and how proposals for network updates are to be made. Anyone holding the network’s native currency (the Atom) is eligible to make a governance proposal and submit it for voting. The proposals can range in focus and magnitude and cover everything from changing how governance occurs on the network to overhauling aspects of the networks codebase that modifies functionality.

The one caveat is that at least 512 Atoms must be deposited toward the proposal by either the member who submitted it or the community broadly. At the end of two weeks, the proposal is either dismissed if it does not receive sufficient backing or enters into a new two week voting period where the community discusses its implications and submit a vote of either “yes”, “no”, “no with a veto”, or choose to “abstain”. Only staked Atoms count towards governance and the relative weight of a participant’s vote is based on their stake in the network. Hence, Validators with larger stakes hold more voting power. Atom holders who choose not to run a validator can stake their Atoms to any validator they feel represents their interest and inherit their vote. A proposal will only be accepted if over 40% of staked Atoms participate in the vote, over 50% of the vote is in favor of the proposal, and less than a third elected to veto the proposal. If successful, the proposal is integrated into the software that runs the network by the core developer team and the validators must coordinate an update to reflect the changes.

More on the finer details of how the governance process works can be found in the Cosmos white paper here, or in this article written by fellow Cosmos Validator Chorus One. It is also important to note that each zone built on Cosmos has its own separate constitution and governance process. Therefore, governance decisions made on the Cosmos Hub do not necessarily dictate how other zones operate. However, if any changes are made to either Tendermint BFT or the Cosmos SDK as a result of the governance update, zones will likely need to update their own networks if they are using either of these technologies.

So How Decentralized is Cosmos?

Cosmos Hub 1 (version 1 of the mainnet)  launched on March 13, 2019, and was one of the first proof-of-stake networks to successfully carry out a fully decentralized launch. This is in contrast to other successful proof-of-stake network launches, like Tezos, which had a group of Foundation Validators who controlled the initial mainnet. The initial active set was capped at 100 possible validators, and 75 of these slots were filled at genesis. This meant that there were 75 different groups distributed around the world working together to coordinate the launch of the network and start actively validating transactions. However, while Cosmos may have had an impressive initial degree of decentralization based on the number of unique validators, the true magnitude of that decentralization was far more nuanced.

Within the first week after the launch of the Cosmos mainnet, the top 5 Validators controlled nearly 50% of the staked Atoms on the network. Moreover, many of these participants had been significant buyers in the Cosmos coin offering. This illustrated that, while Cosmos may have been decentralized in terms of the number of validators, the actual distribution of power and resources within the network told a far different, more centralized story. For the next three months, 15 or fewer validators controlled ⅔ of the staked atoms on the entire network at any given time (per https://twitter.com/cosmosdecentral). In October 2019, Gavin Birch, community analyst at Figment Networks, released a report detailing the negative repercussions that coupling governance with the validator role was having on Cosmos, which may be found here. In summary, the report revealed that validators were exploiting the Cosmos incentive structure to gain undue influence over network governance at the expense of other validators. Some validators were running with zero fees, meaning that 100% of the rewards they received would be distributed to those staking with them. Naturally, these zero-fee validators received a disproportionate amount of the stake as atom holders sought to maximize their returns. This forced some validators to shut down, due to their inability to continue competitively and earn rewards sufficient enough to offset the cost of their infrastructure.

Many community members grew concerned over what this meant for the future of Cosmos, as this behavior posed a major security vulnerability to the network. If validators continued to exploit the network in this fashion, it would drive away those that could no longer afford to run a validator and decrease the level of physical decentralization across the network. Thus, it would be easier for malicious actors to overtake the network. Thus, on December 11, Cosmos Hub 3 was launched based on a governance proposal that aimed to reconcile some of the alignment issues between network governance and incentives. The first major change was that the active set of validators was expanded from 100 to 125 validators, allowing for more participation in the network. The second major change was a redefining of the entire governance structure. Prior to the upgrade, voting was only a signaling mechanism. The result of a vote would have no immediate consequences other than telling the core development team what changes needed to be made to the network based on the proposal. The core developers would then release a software update, all of the validators would coordinate when to perform, and the new network would be restarted (a process known as a hard fork). With the release of Cosmos Hub 3, the network now features on-chain governance. This means that the result of a vote will automatically elicit changes to the codebase to the appropriate parameters and alter how the network behaves without having to perform a hard fork.

Instituting on-chain governance drastically shifts the incentives for network participants to vote and provides a mechanism by which delegators (those staking to other validators) can more actively participate in governance. While they still have the option to inherit the vote of the validator they are staked to, delegators can also elect to instead override that vote with their own if they disagree with how the network should proceed. This helps galvanize nominators to play a more active role in governance which helps balance the economic and governance incentives of the network while maintaining a relatively stable degree of physical decentralization. Additionally, there has been a proposal made to fund a governance working group to work alongside protocol development and help address emerging governance issues. There were several other major updates in Cosmos Hub 3, like the introduction of a rewards pool from which network participants can vote on proposals to fund projects that enhance the ecosystem. The full proposal may be found here.

It is still too early to say if expanding the active set of validators and introducing on-chain governance was the right answer to solving the centralization of power and economics on Cosmos. Figment Networks’ December Cosmos update revealed that the voting power of the bottom 90% of validators on the network had increased 3% from November. However, it also found that the top 10 validators on the network controlled 46% of the voting and consensus power. This analysis was only done between the top 100 validators in December to maintain consistency from November, so this month’s analysis will better reflect the impact that increasing the validator set to 125 had on the decentralization of the network. And who knows, with Cosmos slated to conduct Game of Zones in the coming months to refine their inter- blockchain communication module, a slew of major updates are likely to happen this year that will fundamentally change how the network operates. Thanks for reading and join me next week as we dissect the decentralization of one of the fastest growing networks in South Korea and a zone within the Cosmos ecosystem, Terra!