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Contribution Details

Type Master's Thesis
Scope Discipline-based scholarship
Title Terra Blockchain Potential Irregularities Analysis
Organization Unit
Authors
  • Shuyue Wang
Supervisors
  • Claudio Tessone
  • Sheng-Nan Li
Language
  • English
Institution University of Zurich
Faculty Faculty of Business, Economics and Informatics
Date 2022
Abstract Text Blockchain develops quickly in the past few years with lots of new consensus mechanisms and networks coming out. One of the most famous blockchains is Terra, utilizing Proof-of-Stake consensus model to realize the concept, stablecoin. Former studies concentrate more on the consensus mechanism and the success story. However, after May 2022, Terra got a severe attack and the whole network crashed afterward. Our research looks deeper into the irregularities and comprehensive measurement of the performance of the network, trying to reveal some key insights about Terra’s failure. The Gini index is used to analyze the past five-month network equality of validators rewards and delegators rewards respectively. Mining speed and rewards average distribution are also calculated for each month to show their equality. We also compare results between pre-attack and post-attack to see how the network changes after the huge crash. Through detailed and complete studies, we found some potential signals or reasons for the attack based on results that the network becomes more and more centralized and inflexbile, which may lead to unbalanced distribution and less motivation for users to participate. Therefore, we can reach the conclusion that Terra is becoming more unequal and bloated in the past five months before the attack.
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