Who Cares About Decentralization, Anyway?
Yes, decentralization is a buzzword. Yes, we talk about it all the time. But what does decentralization really mean and why is it important to Cardano’s success?
Think about Cardano as infrastructure, like a highway. At first it's just a lonely stretch of road. As time goes by, though, things are built along the highway. Traffic increases. Now a lot of people are using the highway. There are onramps, bridges, and stores along the way. In the Cardano ecosystem the road is our stake pools; they provide the highway. The stores along the highway are dApps and decentralized exchanges. The highway is getting pretty busy now. Our highway is secure when the flow of traffic is managed by many stake pools. Imagine if one person or pool had control of the traffic. They could stop everything, charge a toll, even hijack the whole process. This is why supporting individual stake pools is so very important. Decentralization is not just a buzzword. It is literally the foundation that everything is built on. It's not an exaggeration to say that the future of the network depends on it.
Of course there are a wide variety of strategies on promoting decentralization within the Cardano ecosystem. Part of this is complicated by the fact that Cardano will not reach full community governance until the Voltaire phase. So at this moment while the community has a vote in Catalyst, IOG is still in charge of system parameters. Growth, and the introduction of new products is also challenging the balance of the ecosystem. Some of the Multipools have stated publicly that they will happily continue to add additional pools without regard to decentralization. With all this in mind, Chef Theo and guests spent several hours Thursday evening discussing all things decentralization.
Clearly self promotion and adding value are key to the success of any stakepool in this environment. Even that is not enough, however, as we have watched some pools lose upwards of 75 percent of their stake to Sundae Swap and other ISOs. The reality is that this pressure is only going to increase as Cardano grows. Survival going forward is going to require creativity and some forward thinking friends, such as those at IAMX. Their representative dropped by the space to express their interest in helping the SPOs and contributing to the diversity of the ecosystem. He advised that they could be contacted on their discord and would be happy to help SPOs with concerns like: code checking, project ideas or other technical questions. IAMX isn’t the only interested party. Hosky Token has also recently arrived on the scene as a supporter of the SPOs. With a large social media following, the pooper scooper program and their own delegation, there is no doubt that Hosky is leading the pack when it comes to advocating for the small pools.
Chef Theo and company also discussed two CIPs (Cardano Improvement Proposals). CIP 163 correlates a pools total pledge to their saturation level and CIP 13 creates a link that can be used to facilitate delegation from an SPO’s website or other content they create. Additionally it was noted on the call that many of the wallets are working on the ability to add fiat directly which will help the problem of up to 30% of ADA freefloating on exchanges like Binance. Closer to home, Tim Harrison has committed to discussing some of these issues on the February SPO call and Daniel Ribar and the Catalyst team are working on some changes of their own to limit the ability of large holders to control the vote.
In summary, both challenges and new tools are headed our way. The one thing that everyone agreed upon was that education is key. Particularly education that is not from multipools who currently dominate the Youtube space. Educating newcomers about decentralization, pool options and Cardano’s security is the key to long term survival for the single stake pools.
And now for a bit of background on IAMX and the SPOs that were kind enough to join Chef Theo for his Twitter space:
IAMX
IAMX is a token based identity and authentication system that enables legally binding actions in 1 click. Think for one moment about how many forms you fill out in a lifetime: forms to vote, forms to travel, insurance forms, credit applications - it goes on and on. This occurs because you don’t own your identity. The state does. IAMX changes all of that and puts you in control of your identity. Basically there are two types of markets, each with their own problems. In developed markets you have an established identity but you spend up to 400 days of your life filling out forms. In emerging markets, the opposite problem occurs. Its hard to prove your identity. As a matter of a fact 1.4 billion people have no established identity and fifty percent of women in low income countries have no established identity. This means they can’t travel, get loans, or profit from legally binding contracts.
IAMX addresses these problems with a terminal that includes a scanner, a biometric camera, and touch display screen. It uses your face, iris and fingerprints. It creates a customer owned, customer verified identity and wallet. In short, you own your data and it goes where you want it to go, when you want it to go there. A project of this size requires partnerships. IAMX has many partners including MELD, Blockpit, Danube Tech WADA and many Telco partners.
IAMX is currently running multiple stake pools. While they feel this is necessary for their project, they are sensitive to the plight of the SPOs. As stated above they have technical expertise and are available to assist SPOs with project ideas or technical questions. SPOs should reach out on their discord.
Tails Pool
Talis is the story of Fred and MermAda, a husband and wife team from the Great Lakes Region who opened their pool just over a year ago. They have over thirty years experience in computers, IT, customer service and social media management. In addition to their performances and stake pool operations, the pair also runs an NFT minting service. They offer customizable services to meet a broad spectrum of needs. You can mint a single NFT, 10 NFTs, bulk batches or set up a mint on demand. They will work with you to create a customized package that meets your needs.
The Tails stake pool is a mission driven pool. They support charities that protect our oceans, including the Coral Restoration Foundation and Sea Shepherd. Sea Shepherd was founded in 1977 by one of the original members of Greenpeace. Basically there is a lot of open ocean and maritime conservation laws are hard to enforce. Sea Shepherd, though small in size, has been able to achieve real impact by using direct action. Instead of using posters and billboards, they have a fleet of 12 ships, largely manned by passionate volunteers, out in the sea - working with international organizations like INTERPOL to stop illegal poaching and fishing. You can find out more about Sea Shepherd and how you can help here
The Coral Restoration Foundation which is the largest reef restoration organization in the world. There is a barrier reef that runs all the way from Miami to down below Key West. It is, in fact, the third largest barrier reef in the world. It is also in crisis at the moment as it hosts just two percent of the dominant coral species from the 1970’s. The Coral Restoration Foundation is fighting that by literally planting and farming coral. To date they have restored more than 17,500 square meters of Florida's Coral Reef.
Maple Pool
Maple is a brand new pool out of Canada, operated by Daniel, his friend and their wives. They started the pool as an effort to promote decentralization within the Cardano Ecosystem and are members of the xSPO alliance. Additionally Daniel is running bare metal servers in two locations to assure 100 percent uptime. Daniel is an advocate of CIP 163 which ties a pool's pledge to its saturation level. They are working on increasing delegation and awareness of their pool.
Rabbit Hole Pool
Stefano is a data scientist by trade. His interest in blockchain was solidified by an article which looked at how blockchain could help peer reviewed scientific projects. This caused him to see the potential of Cardano to impact change far beyond the scope of traditional cryptocurrency. Stefano lives in eastern Australia, in Queensland. Stefano loves operating the pool because it is an ever evolving challenge - he is always learning something new. He is focused primarily on local causes as a great way to educate the community about the benefits of Cardano. He donates to a cycling club, The Cardano Riders, which is a local bicycling group. He also collects and contributes to a fascinating organization called Aussie Bread Tags for Wheelchairs These folks actually recycle the plastic clips from bread bags and use the proceeds to purchase wheelchairs for disadvantaged people. They have purchased 47 wheelchairs to date. Think about changing someone's life by recycling bread tags. It speaks to the power of simple, small acts of kindness. There is a video about their work here
Stefano is interested in promoting decentralization within the Cardano Ecosystem. He has created his own publicly available staking guide and is interested in promoting CIP 00013 which would create links that SPOs can put on their websites or on content that they create. This would allow people to delegate just by clicking the link and approving with their password.
By Traveler Jo | CardanoArmy.io
You can find Traveler Jo somewhere close to the sea. She loves Cardano, kayaking and food - not necessarily in that order. She's busy exploring the world, always in the company of her husband, tired dog and indignant felines.