The Nakamoto Coefficient is a measurement used to measure the degree of decentralization of a blockchain network. method. The minimum Nakamoto coefficient refers to the number of nodes that need to be controlled to control a blockchain network.

This concept was proposed by Balaji Srinivasan, the former CTO of Coinbase, in 2017. This method is inspired by the two theories of Gini coefficient and Lorenz curve. These two theories are used to measure the degree of centralization of wealth and power in a society. Srinivasan proposed to evaluate the degree of centralization of a network from six dimensions, namely: Mining, Client, Developer, Exchange, Node and Token Holding. There is a situation (Ownership). By calculating the minimum Nakamoto coefficients of these six dimensions respectively and taking the minimum value, the minimum Nakamoto coefficient of the network can be obtained.

The six dimensions specifically refer to:

• Mining: block rewards in the past 24 hours
• Client: different Number of client codes
• Developer: Distribution of the number of developer commits
• Exchange: Distribution of token trading volume on various exchanges
• Node: the distribution of nodes in various countries
• Ownership: the status of tokens held by each address

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