Welcome to this weeks Just The Metrics

Hello & Happy Sunday,

here is Just The Metrics - your newsletter with the latest updates from the Cryptoverse, Crypto Metrics, L1 Comparisons, and all about Cardano.

We hope you are doing fine and managed to cope with the roller-coaster-like behavior with the latest market up-and-downswings.

Here's what we got this week:

1. Updates from Cardano

• Update from Cardano Vasil Hard Fork: Date Confirmed

2. Diving into Just the Metrics

• The L1-Assessment-Framework applied to Tezos

Ok, let's dig in!

Update from Cardano's Vasil Hard Fork: Roll-Out Date is Confirmed

On Friday, IOG confirmed the date for Cardano's Vasil Hard Fork Upgrade, the most significant upgrade so far.

It is on the 22nd of September!

The upgrade criteria determined by IOG and the Cardano Foundation are all well tracked against the target and ready for launch:

• 75% mainnet blocks being created by the final Vasil node candidate (1.35.3)

• Approx. 25 exchanges upgraded (ca. 80% of ada liquidity)

• Top 10 Decentralized Applications (DApps) by TVL confirming readiness

To follow along the progress of each and every metric here is a Website dedicated to the Vasil Upgrade providing transparency along the process: Ecosystem Readiness for Vasil Upgrade

L1 Assessment Framework applied to Tezos

Crypto is an emerging asset class of the 21st century. And when making investment decisions in this particular asset class, it is important not to base them on hype or ever-changing narratives.

Especially in the light of recent events, it becomes more & more evident that fundamental and metrics-based decision-making is key for a profound project assessment.

So here is the Blockchain Trilemma as Assessment Framework

Let's take a look at certain metrics of Tezos that determine its degree of

• Security

• Scalability &

• Decentralization

General Decentralization Metrics:

Initial Token Distribution:

• Tezos had a fair coin distribution from the very beginning. Moreover, this equitable initial token distribution has set the tone for the decentralization of Tezos from the beginning onwards, which is a rare feat when we look at the current public blockchain landscape.

The number of individual staked wallets & staking ratio

• Tezos has over 180,000 staked wallets with a staking ratio of 74,18%, which reflects a high degree of decentralization.

Permissioned vs Permissionless Node (Yes/No):

Tezos is a permissionless public blockchain

The total number of active validator nodes/relay nodes/stake pools

• As of 04.08.2022, Tezos has 404 validator nodes/bakers. Compared with Cardano, which has more than 3100 validator nodes, Tezos has a relatively low number of validators.

Factors Enabling Decentralization:

Size of a full node: 

Tezos has 3 history modes of a node:

• Archive mode: a node in archive mode stores the entire blockchain state. The details regarding the current size of the Tezos archival node are unavailable. However, as of early 2021, the whole blockchain takes about 145GB.

• Full mode (default mode): a node storing the entire blockchain without storing the ‘context’ (the blockchain state containing information such as: "Alice's account owns 5") below a certain level called savepoint. It is possible to rebuild an Archive Node from a full snapshot¹.

• Rolling Mode: the lightest existing node mode, which stores a fragment of the chain and removes anything before that fragment (blocks, operations, archived contexts)

Minimum hardware & connectivity requirements for running a validator node/relay nodes/stake pool:

• CPU: Running with at least 2 cores is recommended

• Memory: Recommended RAM for running a Tezos Node is 8GB

• Disk: 100 GB SSD (SSD is highly recommended over HDD)

• Monetary requirements: A validator on Tezos, a full node, stores the record of the chain and can inject transactions but requires a roll of Tezos (6,000 XTZ = USD 9060) staked to begin validating

General Security Metrics:

Cost of 51% attacks

• For an attacker to control 51% of the Tezos network, it will cost over USD 691 million, not factoring in the price appreciation that will occur with a buyer trying to purchase that much XTZ

Vulnerability to denial-of-service (DoS) and distributed denial-of-service (DDoS) attacks:

• Tezos has a low vulnerability to such attacks

Propagation network types (a peer-to-peer propagation network or a relay propagation)

• Tezos has a peer-to-peer propagation network

Factors Enabling Security:

Full Node/Partial Node Ratio:

• The three different history modes of a Tezos node allow for a high Full node/partial node ratio

Client Diversity:

• Currently, Tezos has no client diversity

General Scalability Metrics:

Transaction throughput:

With the activation of Octez v13, Tezos can now process up to 1000 transactions per second (TPS)

Transaction latency & finality time:

Around 1 minute

The Ithaca 2, the ninth Tezos protocol upgrade, was activated in Q2 2022.

The new Tenderbake consensus algorithm lowers block times and improves finality.

Tenderbake guarantees transaction finality after one confirmation and blocks finality after two confirmations. Tenderbake to add one block every 30 seconds.

Active Layer 2s (rollups/state channels):

On 28 June 2022, 23:31 CET, the Tezos blockchain was successfully upgraded by activating the Jakarta proposal (technically Jakarta 2). 

Jakarta 2 enables implementation of Transaction optimistic rollup (TORU) on Tezos. They can handle account-to-account transactions of assets but won’t be able to run smart contracts 

Factors Enabling Scalability:

Status of data availability that enables rollups:

Tezos enables the data availability required for Transaction Optimistic Rollups (TORUs) to function

The upgrade that enables Smart contract rollups is targeted for later this year (SCORUs).

So how does now the overall verdict look like:

Decentralization: moderate-high

Security: High

Scalability: High

Tezos network shows a relatively high degree of decentralization & security, which makes it a solid L1 Blockchain.

Tezos is a rapidly evolving blockchain that has undergone more than ten updates. With the recent upgrade, Tezos has implemented the capability to enable rollups and improved L1 scalability.

Tezos has an ambitious rollup-centric scaling approach with data sharding which enables rollups ranging from transaction rollups, and smart contract rollups to zk-rollups. Tezos is definitely a solid L1 with a clear scaling strategy.

💎 Gem of the Week 🧵

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.