Cryptocurrency

On-chain metrics show peak Ethereum network performance post-Merge

Zegex

The Ethereum merge was completed on September 15th, marking an important milestone in the network’s transition to a Proof of Stake (PoS) chain and the journey to ETH 2.0, aka the “consensus layer.”

A month later, what do the on-chain metrics tell us about ETH’s network performance after the merge?

Ethereum participation rate

Reliability and uptime are key features of blockchain. One way to assess this is through participation rates. Participation rate refers to the percentage of validators online, effectively validating a transaction block. This is calculated as (Total Slots – Failed Slots) / Total Slots.

This metric can be viewed as a gauge of validator responsiveness and network efficiency. Higher participation rates are positively correlated with higher validator node uptime, fewer missed blocks, and block space efficiency.

The chart below shows that Ethereum has an average participation rate of over 99%. There have been several dips below this threshold since the merger. In these cases, however, participation rates quickly recovered to above average marks.

Ethereum participation rate
Source: Glassnode.com

number of attestations

Each Ethereum epoch occurs approximately every 6 minutes. During that time, validators are expected to create, sign, and broadcast certificates. Essentially, this is a vote in favor of the validator’s view of the chain.

Attestation Count refers to collating validator votes that the blockchain is correct and notifying the network that consensus has been reached. A higher Attestation Count means more agreement among validators.

After the merge, the attestation count increased, indicating more agreement between validators since the PoS chain went live.

Ethereum verification number
Source: Glassnode.com

total amount wagered

PoS is a consensus mechanism that randomly assigns the right to validate the next block. Becoming an Ethereum validator requires technical knowledge to set up a node, many of which use third-party cloud computing services.

Additionally, a minimum of 32 ETH is required to enable network participation. At current prices, the cost is over $42,000. Due to the barriers to entry, most laymen provide their tokens to validators.

Generally speaking, The probability of a validator being selected to write the next block is proportional to the number of tokens held.

Once a validator is selected, fees are collected and distributed among the owners who supported the winning validator. This way, a degree of decentralization is maintained without the need to solve hash puzzles, and token holders are able to participate and be rewarded for participating in securing the network.

When a validator misses a block or commits fraud, thrashing occurs, which involves the network forfeiting some or all of the ETH staked by the validator.

The total staking chart below shows that the amount of ETH staked has surpassed 14 million, an all-time high. After the merger, an additional 1.5 million ETH of him was staked into the network, suggesting growing confidence among token holders.

Ethereum Total Stake Amount
Source: Glassnode.com
Posted In: Ethereum, Research

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