XDC Network Assessment: Decentralization, Scalability and Security

TL;DR

This paper evaluates the XDC blockchain network's decentralization, scalability, and security, highlighting its high decentralization through Nakamoto coefficient analysis and discussing its consensus diversity and distribution aspects.

Contribution

It provides a comprehensive real-time assessment of XDC network's decentralization, security, and scalability, including Nakamoto coefficient estimation and analysis of network diversity.

Findings

XDC network exhibits high decentralization based on Nakamoto coefficient.

The network demonstrates diverse consensus and execution clients.

The assessment addresses geo-distribution and operational issues.

Abstract

XinFin, in 2019, unveiled the XDC network, an enterprise-ready hybrid blockchain platform that is open-source and specializes in tokenization for real-world decentralized finance. Overseeing the XDC network is currently the XDC Foundation, a non-profit organization established to encourage the growth, enhancement, and adoption of the XDC Network through community-driven projects such as GitHub. This whitepaper discusses the real-time assessment of the XDC network's decentralization, scalability, and security aspects as well as the Nakamoto coefficient estimation that follows, which is a measure of a decentralized system's decentralization nature that quantifies the minimal number of nodes or entities needed to compromise the system. A high coefficient denotes greater decentralization, while a low number denotes increased disruption risk. The XDC network's real-time computation of the high Nakamoto coefficient demonstrates its highly decentralized character. The article also addresses the diversity of consensus and execution clients, the host distribution, the geo-distribution, and some of the outstanding issues and business considerations.