Cargando…
The Structural Role of Smart Contracts and Exchanges in the Centralisation of Ethereum-Based Cryptoassets
In this paper, we use the methods of networks science to analyse the transaction networks of tokens running on the Ethereum blockchain. We start with a deep dive on four of them: Ampleforth (AMP), Basic Attention Token (BAT), Dai (DAI) and Uniswap (UNI). We study two types of blockchain addresses, s...
Autores principales: | , , , |
---|---|
Formato: | Online Artículo Texto |
Lenguaje: | English |
Publicado: |
MDPI
2022
|
Materias: | |
Acceso en línea: | https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9407335/ https://www.ncbi.nlm.nih.gov/pubmed/36010712 http://dx.doi.org/10.3390/e24081048 |
_version_ | 1784774339225190400 |
---|---|
author | De Collibus, Francesco Maria Piškorec, Matija Partida, Alberto Tessone, Claudio J. |
author_facet | De Collibus, Francesco Maria Piškorec, Matija Partida, Alberto Tessone, Claudio J. |
author_sort | De Collibus, Francesco Maria |
collection | PubMed |
description | In this paper, we use the methods of networks science to analyse the transaction networks of tokens running on the Ethereum blockchain. We start with a deep dive on four of them: Ampleforth (AMP), Basic Attention Token (BAT), Dai (DAI) and Uniswap (UNI). We study two types of blockchain addresses, smart contracts (SC), which run code, and externally owned accounts (EOA), run by human users, or off-chain code, with the corresponding private keys. We use preferential attachment and network dismantling strategies to evaluate their importance for the network structure. Subsequently, we expand our view to all ERC-20 tokens issued on the Ethereum network. We first study multilayered networks composed of Ether (ETH) and individual tokens using a dismantling approach to assess how the deconstruction starting from one network affects the other. Finally, we analyse the Ether network and Ethereum-based token networks to find similarities between sets of high-degree nodes. For this purpose, we use both the traditional Jaccard Index and a new metric that we introduce, the Ordered Jaccard Index (OJI), which considers the order of the elements in the two sets that are compared. Our findings suggest that smart contracts and exchange-related addresses play a structural role in transaction networks both in DeFi and Ethereum. The presence in the network of nodes associated to addresses of smart contracts and exchanges is positively correlated with the success of the token network measured in terms of network size and market capitalisation. These nodes play a fundamental role in the centralisation of the supposedly decentralised finance (DeFi) ecosystem: without them, their networks would quickly collapse. |
format | Online Article Text |
id | pubmed-9407335 |
institution | National Center for Biotechnology Information |
language | English |
publishDate | 2022 |
publisher | MDPI |
record_format | MEDLINE/PubMed |
spelling | pubmed-94073352022-08-26 The Structural Role of Smart Contracts and Exchanges in the Centralisation of Ethereum-Based Cryptoassets De Collibus, Francesco Maria Piškorec, Matija Partida, Alberto Tessone, Claudio J. Entropy (Basel) Article In this paper, we use the methods of networks science to analyse the transaction networks of tokens running on the Ethereum blockchain. We start with a deep dive on four of them: Ampleforth (AMP), Basic Attention Token (BAT), Dai (DAI) and Uniswap (UNI). We study two types of blockchain addresses, smart contracts (SC), which run code, and externally owned accounts (EOA), run by human users, or off-chain code, with the corresponding private keys. We use preferential attachment and network dismantling strategies to evaluate their importance for the network structure. Subsequently, we expand our view to all ERC-20 tokens issued on the Ethereum network. We first study multilayered networks composed of Ether (ETH) and individual tokens using a dismantling approach to assess how the deconstruction starting from one network affects the other. Finally, we analyse the Ether network and Ethereum-based token networks to find similarities between sets of high-degree nodes. For this purpose, we use both the traditional Jaccard Index and a new metric that we introduce, the Ordered Jaccard Index (OJI), which considers the order of the elements in the two sets that are compared. Our findings suggest that smart contracts and exchange-related addresses play a structural role in transaction networks both in DeFi and Ethereum. The presence in the network of nodes associated to addresses of smart contracts and exchanges is positively correlated with the success of the token network measured in terms of network size and market capitalisation. These nodes play a fundamental role in the centralisation of the supposedly decentralised finance (DeFi) ecosystem: without them, their networks would quickly collapse. MDPI 2022-07-30 /pmc/articles/PMC9407335/ /pubmed/36010712 http://dx.doi.org/10.3390/e24081048 Text en © 2022 by the authors. https://creativecommons.org/licenses/by/4.0/Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https://creativecommons.org/licenses/by/4.0/). |
spellingShingle | Article De Collibus, Francesco Maria Piškorec, Matija Partida, Alberto Tessone, Claudio J. The Structural Role of Smart Contracts and Exchanges in the Centralisation of Ethereum-Based Cryptoassets |
title | The Structural Role of Smart Contracts and Exchanges in the Centralisation of Ethereum-Based Cryptoassets |
title_full | The Structural Role of Smart Contracts and Exchanges in the Centralisation of Ethereum-Based Cryptoassets |
title_fullStr | The Structural Role of Smart Contracts and Exchanges in the Centralisation of Ethereum-Based Cryptoassets |
title_full_unstemmed | The Structural Role of Smart Contracts and Exchanges in the Centralisation of Ethereum-Based Cryptoassets |
title_short | The Structural Role of Smart Contracts and Exchanges in the Centralisation of Ethereum-Based Cryptoassets |
title_sort | structural role of smart contracts and exchanges in the centralisation of ethereum-based cryptoassets |
topic | Article |
url | https://www.ncbi.nlm.nih.gov/pmc/articles/PMC9407335/ https://www.ncbi.nlm.nih.gov/pubmed/36010712 http://dx.doi.org/10.3390/e24081048 |
work_keys_str_mv | AT decollibusfrancescomaria thestructuralroleofsmartcontractsandexchangesinthecentralisationofethereumbasedcryptoassets AT piskorecmatija thestructuralroleofsmartcontractsandexchangesinthecentralisationofethereumbasedcryptoassets AT partidaalberto thestructuralroleofsmartcontractsandexchangesinthecentralisationofethereumbasedcryptoassets AT tessoneclaudioj thestructuralroleofsmartcontractsandexchangesinthecentralisationofethereumbasedcryptoassets AT decollibusfrancescomaria structuralroleofsmartcontractsandexchangesinthecentralisationofethereumbasedcryptoassets AT piskorecmatija structuralroleofsmartcontractsandexchangesinthecentralisationofethereumbasedcryptoassets AT partidaalberto structuralroleofsmartcontractsandexchangesinthecentralisationofethereumbasedcryptoassets AT tessoneclaudioj structuralroleofsmartcontractsandexchangesinthecentralisationofethereumbasedcryptoassets |