Solana has seen a sharp decline in the number of validators securing the blockchain, a trend that industry players say is driven by rising costs for smaller operators.
Key points to remember:
- Solana lost 68% of its validators as rising costs drove out small nodes.
- Network concentration increases, with the Nakamoto coefficient falling to 20.
- On-chain activity continues to grow, driven by AI-related token launches.
Solanacompass data shows that the number of active Solana validators has fallen 68% over the past three years, from a peak of 2,560 nodes in March 2023 to just 795 this week.
Validators play a central role in the network, proposing and confirming blocks and ensuring transactions are processed correctly.
Increased costs, not just zombie nodes, but decline of disk validator
Part of the reduction reflects the cleanup of inactive or so-called “zombie” nodes, but operators say that alone does not explain the magnitude of the drop.
Instead, they point to increased operating expenses and fee competition that have made it difficult for independent validators to break even.
An independent validator who publishes under the name Moo told X that many small operators are considering closing their doors.
“Many small validators are actively considering going out of business (including us). Not because of lack of confidence in Solana, but because the economics no longer work,” Moo wrote.
According to the post, large validators offering fee-free services are reducing their margins and forcing smaller players out of the market.
The result, critics say, is a network increasingly secured by a small number of large operators.
“We have started to validate support for decentralization. But without economic viability, decentralization becomes charity,” Moo added.
This change raises the question of whether retail validators can continue to play a meaningful role in securing Solana in the long term.
Concentration of Nakamoto coefficient signals
The decline in the number of validators was reflected in a drop in Solana’s Nakamoto coefficient, a commonly used measure of decentralization.
Solanacompass data shows the coefficient fell 35%, from 31 in March 2023 to 20 this week.
The metric estimates the minimum number of independent entities needed to disrupt the network, with a lower number indicating greater concentration.
The slide suggests that stakes and influence are increasingly clustered among a small number of validators.
Rising costs appear to be a major factor. Excluding hardware and server expenses, operators must commit at least $49,000 worth of SOL tokens to cover their first year, largely due to the voting fees required to participate in consensus.
Validators must submit a voting transaction for each block they approve, a process that can cost up to 1.1 SOL per day, according to Solana’s validator client technical documentation.
Meanwhile, Solana has seen an uptick in on-chain activity even as SOL prices decline, driven by growing interest in AI-driven tokens across the network.
The post Solana Loses Two-Thirds of Validators as Small Nodes Leave, Raising Centralization Concerns appeared first on Cryptonews.
