The data on the chain show more than half of the Ethereum offer is owned by only 10 addresses. Here’s how other Eth -based tokens like Shiba Inu hide.
Shiba Inu, Uniswap and Ethereum are among the most centralized ethn toys
In a new article on X, the Santiment Chain Analysis Society explained how the various assets of the Ethereum ecosystem accumulate against each other in terms of quantity of supply which focuses on the 10 upper portfolios.
You will find below the graphic shared by Santiment which shows the trend of this metric for eight cryptocurrencies in recent months.
Looks like SHIB is at the top of the list at the moment | Source: Santiment on X
According to the graph, it is visible that 51% of the Ethereum supply belongs to the 10 largest portfolios in the network. It is more than most other ETH -based tokens on the list.
The two pieces that are to come in this metric are Shiba Inu (Shib) and Uniswap (UNI). The latter is only marginally in advance on ETH with a value of 52.2%, but the first is considerably in advance at 62.3%.
Generally, the supply of a cryptocurrency being strongly concentrated on a few hands does not tend to be a constructive signal, because this means that only a few players are necessary to move the market.
Beyond market dynamics, the centralization of supply has another drawback: it potentially weakens network security. Channels like Ethereum race on a consensus mechanism called proof of bet (POS). As part of this system, validators called stakers must lock a stake in order to receive a chance to add the following block to the chain.
The higher the stake of a validator, the more it is high from the possibility of being chosen. If a single staker crosses the 51%feeding threshold, it can, in theory, take a total check on the blockchain.
This type of attack does not exist on Bitcoin, where the evidence of work proof (POW) mechanism is used instead. In POW networks, minors compete against each other using the computing power. Here too, however, if a validator gains control of more than 51% of the IT resources of the network, he can model BTC to their will.
Since Ethereum has only 10 holders controlling 51% of the offer, an attack on the network is possible if these entities meet. The chances that this happens, however, are quite slim.
However, the tastes of ETH, SHIB and UNI are notably centralized on a few holders could be something to watch. On the other hand, some other chips of the ecosystem such as USDC (28.6%), DAI (31%) and ChainLink (31.5%) are in a healthier area in terms of this metric.
Ethn price
Ethereum has increased by almost 4% in the last 24 hours which has brought its price at the $ 4,380.
The price of the coin seems to have shot up over the past day | Source: ETHUSDT on TradingView
Dall-e star image, Santiment.net, TradingView.com graphic
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