Osmosis, onwards to decentralisation
Osmosis went live in the end of June and we can safely say it has been a very successful start where the platform gained traction and the token has proven itself. Part of the supply is locked in liquidity pools and part of the supply is locked being delegated to validators to secure the network (not taking the dev funds, community pool and unclaimed coins into account).
Where the liquidity pools can’t be steered in terms of “decentralisation” we can do that for the coins delegated. The ideal situation is that every validator has exactly the same amount of voting power, but this will never be reached. However, the situation we have right now can be improved though. As we speak 6 validators represent almost 50% of the total voting power of the network. A stunning 78 validators have a voting power less than 1%.
As we seen have happening during the voting on proposal 22 this can greatly offset the governance principle on the Osmosis chain. If one of the biggest validators decides “Yes” or “No” the power swings to either side in the voting. And from there it is a struggle uphill for the remaining voting power to compensate that vote.
To achieve greater decentralisation, from Sunday 29–08–2021 onwards I will start a raffle. The goal is to have more OSMO delegated to smaller validators. In a lot of cases the validators nearer to the bottom of the list have exactly the same commission as the biggest, so in terms of personal rewards for delegating your coins it will not matter. However, the delegations to the smaller validators might yield a nice bonus if you are the lucky winner of the day.
At the start the raffle will be on a weekly basis. Every Sunday one of the delegators to the Little_Cryptomen validator (abbreviated LC) will win 25% of the OSMO commission earned that day.
The goal is to have more OSMO delegated to smaller validators. Every delegated OSMO counts as a ticket, so the more delegated, the more chance you have. When the voting power of my validator reaches the 100k I will start adding days where a raffle is being held. The scheme below is applicable:
As soon as the voting power of the Little_Cryptomen validator goes above 100k, other validators are randomly selected of which one happy delegator will win 10% of the commission of the indicated day. Also here, every OSMO delegated is 1 ticket.
For example; the voting power of LC is 110k. The second line of the schematic is applicable in that case. On Sunday a delegator to the Little_Cryptomen validator wins 25% of the commission of that day.
On Wednesday one random validator is selected with a voting power below 100k (at the time of writing this concerns 51 validators). From that validator one random delegator wins 10% of the commission of that day earned by LC (so the selected validator does not have to do anything).
As the voting power of LC might grow further, more days are selected for a raffle. Ultimately a raffle will be held 7 days a week; on Sunday for the delegators to the LC validator, the other 6 days for a random other validator with voting power below 100k and from that validator a random delegator wins.
Note: the more voting power delegated to the Little_Cryptomen validator, the higher the daily earned commission. The 10% and 25% prize will thus also grow over time.
EDIT: a change has been made on 08–09–2021. Read the details here https://little-cryptomen.medium.com/osmosis-onwards-to-decentralisation-continued-5291878897dc
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