Who will become the biggest opponent of ETH 2.0? Tezos or Cosmos?

In 2020, PoS issuance of additional public chains has become one of the hottest topics in the market.

This article will combine the data on the chain to analyze and compare the three star PoS projects ETH2.0, Tezos and Cosmos, and analyze the currency holding addresses and number of these three networks based on current data.

ETH2.0 is an update of ETH that will start this year. It is divided into four parts. In the 0 phase of the launch, ETH will switch from PoW mining mode to PoS mining mode, which will mean new output of ETH The issuance rate of ETH will be reduced from close to 10% to less than 2%, which means that it is lower than the inflation rate of traditional currencies, and the scarcity of ETH will be proven.

Tezos is a high-performance underlying public chain benchmarking Ethereum. The highlight is the self-repair function. XTZ token holders can mortgage their tokens as nodes, or indirectly by entrusting tokens to “bakers” Participate in governance, and carry out technological upgrades and iterations, to avoid forks to the greatest extent, and the community also has a layout in DeFi and compliant finance.

Cosmos is a decentralized network that provides scalability and interoperability. It is built by the Tendermint consensus BFT consensus algorithm. Tendermint Core and the inter-blockchain communication (IBC) protocol form a common architecture, allowing each cryptocurrency main chain to achieve interoperability .

With the emergence of several star public chains, the adoption of the PoS consensus mechanism has become an unstoppable trend in the new generation of public chains. Staking participates in the management of network security by staking tokens to prevent token holders from being diluted due to inflation. On the contrary, in the mining field of PoW algorithm, the business logic behind mining is the manufacturing logic that is separated from tokens, and more in the field of computers and hardware and offline operations. Several major companies such as Yuchi and Bitmain have already achieved scale in the mining industry, and it is difficult to start from scratch and surpass the existing giants.

Of course, PoS is not perfect. Some projects, on the one hand, lock in the tokens that users already have, and on the other hand, take out part of the additional tokens as rewards to loyal users. At first glance, this model looks good, but unfortunately, because the subsequent overall market is not good, the intrinsic value of some PoS tokens cannot support the actual currency price. Users who hold such projects often make money and lose money.

Later, the market preference turned to a deflationary economic model, and PoS was rarely mentioned for a period of time. However, in the first half of this year, the emergence of ETH2.0 gave this track a new brilliance. Phase 0, which is expected to go online in the third quarter, officially confirmed that it needs to mortgage 32 ETH for PoS mining, which means that it will be pulled down. The expected additional issuance of ETH and the threshold of the node reward model have also pushed the staking model to the forefront again. The analysis in this article is based on data from the Amberdata API.

1. How many tokens are in the top 10, 100, and 1000 addresses

In the world of public chains, there is no clear identity information. We usually use addresses as the carrier of identity. Regardless of whether there is a person or a group of people behind this address, they act as a community of interests on the chain to make consistent behaviors.

ETH, Tezos and ATOM all use the account model, that is, each address is an account. As of June 17, 2020, ETH has a total of 101539249 accounts (Etherscan data), which will increase by at least tens of thousands a day after January 2018. Unfortunately, most of them do not hold tokens.


As shown in the figure above, among these ETH addresses, we see 15.93% of the tokens in the top ten addresses, 35.32% of the tokens in the top 100 addresses, and 64.87% of the tokens in the top 1,000 addresses. ATOM has a total of 31358 addresses, 125 validators, 88.82% of tokens in the top ten addresses, 98.62% of tokens in the top 100 addresses, and 99.94% of tokens in the top 1,000 addresses. Tezos has a total of 546,382 addresses and 494 baker (equivalent to validators). The top ten addresses have 20.71% of the tokens, the top 100 addresses have 53.24% of the tokens, and the top one thousand tokens There are 81.23% of tokens.

Comparing the total number of accounts and the number of coins held by the three types of addresses, we can clearly see that ETH is the best in decentralization, and it should be the second public chain in market value. The presentation of Tezos on the three data is surprising. As a relatively new blockchain, the performance of its top ten addresses and top 100 address tokens is not much worse than that of ETH.

Limited by the total number of addresses, the number of tokens on the first thousand addresses is slightly inferior. The Tezos system uses a “baker”, which is similar to the existence of miners (but does not require expensive hardware and large amounts of electricity). The bakers will maintain Tezos network security and verify transactions. Among the top 1,000 addresses, there are cases where baker uses a large number of their own tokens to attract external pledges. Therefore, we can think that non-bakers (that is, ordinary users) on the Tezos public chain still have a not low percentage of codes. currency. This proves that the Tezos public chain has certain advantages over many PoS public chains in terms of decentralization. The degree of decentralization is a key indicator to measure the potential of a project. Higher decentralization means greater community and developer potential and more democratic governance.

These three public chains are the same as the main smart contract. The larger the total number of accounts, the greater the number of potential users, and the more dispersed the currency holding addresses mean that it is easier to achieve decentralization.

In terms of the number of users and the degree of decentralization, there are very few public chains that can challenge Ethereum in the short term. However, there are many people who slander Ethereum, and later public chains are shouting the fate of Ethereum. It is worth noting that Ethereum is not yet a real PoS network and will only switch to PoS after the ETH2.0 upgrade is launched. Therefore, based on the performance of the data on the chain, Tezos is currently the most likely and confident to compete with Ethereum.

2. The staking rate and expected return of Tezos and Cosmos, and the comparison of Ethereum’s predicted PoS situation

For the PoS public chain, users mortgage tokens to obtain additional issuance income and share the income of the entire network expansion. This mechanism is more friendly to the underlying users than the PoW method of producing coins. In the same way, the liquidity of the entire network will be locked. Through the data on the chain, investors can clearly see the circulating market value of these PoS public chain projects and the circulating disks to be unlocked in the short term, which also promotes the possibility of speculation. Sex.

However, it is a pity that compared to the newly issued tokens of the PoW public chain, which are controlled by the upstream mining machine holders, it is easier for the head players to have a consensus on holding and lock the additional tokens together and wait for the price to rise. The newly produced coins in PoS public chain projects that lower the threshold of pledge have become the wool of retail investors, and they are more inclined to sell rather than hold. In the absence of actual value support from the public chain, this part of the selling became the last straw to overwhelm the camel.


According to Messari data, as of June 18, 2020, ATOM’s current dynamic pledge rate is 93.88%, and the annualized rate of return is 9.26%. Unlike the pledge rate displayed by the browser, which uses the total supply of tokens to calculate the pledge rate, the dynamic pledge rate uses the number of circulating tokens, which is more realistic than the total number of tokens, so we use the dynamic pledge rate for calculation.

As of June 18, 2020, the total market value of ATOM is US$511,415,238, which means that the market value of non-pledged circulation is only US$31,298,612, which is close to Dragoncoin, which ranks 137th on Coinmarketcap. The current total circulating supply (Circulating Supply) is 190,688,439. According to the current pledge rate and annualized rate of return, the number of additional issuances per year is 16577095.185. That is to say, the additional tokens issued by ATOM each year are 1.42 times the existing non-pledged circulating tokens.


XTZ’s dynamic pledge rate is 79.93%, the annualized rate of return is 6.94%, and the total market value is 1936917919 US dollars. The total number of tokens in circulation is 733364642. According to the current pledge rate and annualized rate of return, the annual number of additional issuance is 40680778.1, and the value of this part is 107397254 US dollars. In other words, the tokens issued by XTZ each year are 27% of the non-collateralized circulation tokens.

The annual issuance rate of ATOM is 1.42 times that of circulating tokens. Investors will worry that the additional currency issued by the node will impact the market price. In other words, such a high rate of issuance will greatly reduce the cost of token holders. The participating users are unfair. Relatively speaking, the issuance rate of XTZ is much lower, which is obviously more reasonable.

3. Active currency holding addresses

According to the data monitored by LongHash, 38% of ETH addresses have been active in the past year, that is, transactions or transfers have occurred. From the perspective of the number of tokens, the number of active tokens in one year accounted for 76.01% of the total circulating tokens. Tezos’ mainnet was successfully launched on September 18, 2018. Among the Tezos token XTZ holders, 56.2% of the addresses have an active record in the past year. In the past year, the number of active XTZ tokens The proportion reached 95.17% of the circulating supply. From the active time of the addresses, it can be seen that the top 1000 addresses have a high proportion of transactions in the past 30 days. Both transactions and mortgages show high activity.



Cosmos Hub went live on the mainnet on March 13, 2019. In Cosmos, 44.25% of addresses are currently active, that is, transactions have occurred in the past month. These addresses are in 2020, which is 1-5 The percentage of transactions that took place during the month reached 95.5%. From the comparison, it can be seen that the overall activity of the currency holding addresses of Tezos and Cosmos is relatively high. The proportion of Tezos addresses that were last active in May 2020 is higher, and more than 60% of the addresses have remained active in the past month status.

Compared with the old public chain ETH, the two public chains of Tezos and Cosmos have a relatively short time to go online, which makes early supporters more willing to participate in consensus directly or indirectly to maintain network security and prevent their tokens from being diluted by inflation. . Although in the staking economy, the market potential has not been fully utilized, in the PoS token economy, not only are there benefits, but participants must also fulfill their obligations and bear risks. However, with the gradual improvement of supporting facilities in the industry, many exchanges and wallets have now incorporated the staking business into their commercial landscape.

For example, Coinbase and Binance’s staking support for XTZ allows users to easily participate in transactions and commissions in wallets and exchanges that integrate staking functions. These supporting facilities meet the staking operation and security needs of many ordinary currency holders. Early investment institutions provided professional technical solutions to participate in commission and governance, which indirectly promoted the activity of XTZ tokens.

In the future, the decentralized governance and ecological improvement of the public chain will be the key to whether the public chain can maintain its vitality for a long time. In the development process, many designs have created the liquidity requirements of the underlying public chain. For example, Tezos and Cosmos are committed to providing interoperability to a certain extent. Assets on the Tezos chain and the development of tzBTC combine Bitcoin and Other assets have been brought into the Ethereum ecology. In the expansion stage of the ecology, these measures are also attempts to apply different possibilities of the public chain. At this stage, they have played a positive role in the popularity of the project and the participation of users.

From the above data, we can see that, as the second-ranked public chain by market capitalization, ETH has the lowest concentration of large currency holders, which is the highest degree of decentralization. And Tezos’s token XTZ also has a good performance in decentralization, at least better than the same rising star Cosmos, Tezos decentralization. At present, the dynamic pledge rates of both Tezos and Cosmos are maintained at a high level, but if the newly produced tokens do not have a better consensus value support, they will face greater selling pressure. The higher the ratio of additional tokens to the existing non-pledged circulating tokens, the more likely it is to have an impact on the market circulating tokens.

From the perspective of token activity, Tezos and Cosmos have a relatively high proportion of addresses in the past six months. At this point, the support of supporting services and the active development of the project itself are indispensable. But from the current data, Cosmos is facing greater economic pressure. Therefore, as a rising star, Tezos is expected to become a group of dark horses on the PoS track, competing with ETH 2.0.

Establishing an increasingly powerful developer community, finding their own innovative development paths and differentiated advantages, and optimizing the governance structure are also the competitiveness of the future PoS public chain.

This article is part of the partnership between LongHash and the Tezos Foundation, but the views expressed in this article do not represent the Tezos Foundation.

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