Reliability and consistency through true decentralisation – which pool should I choose?
On 10 March there was a catastrophic fire at an OVH data centre in Strasbourg in the heart of Europe.
Despite great marketing promises with the highest quality claims, everything currently indicates that the building structure made of wood, metal poles and corrugated sheeting had no automatic fire protection. Usually, fire suppression in data centres is done by releasing fire-smothering gas. In the event of an alarm, people only have a short time to leave the rooms before the gas is forced into the server rooms at high pressure to quickly displace all combustible oxygen.
What impact such an incident has had on the Cardano network?
After only half a year, the Cardano network already consists of several thousand publicly accessible relay nodes. Only about 10-20 of them were operated in this now completely burnt down data centre in Strasbourg.
So there was no visible reduction in the density value, which is very close to 5 in ideal block production.
So you can see that there is a very good distribution and therefore decentralised deployment. This is very good for all those who want to build on the Cardano network in the future.
Nevertheless, the question arises
Which constellations can have a significant and negative impact on the network?
Here we can clearly say that it is highly recommended to all ADA holders to think about the right things and to make an educated decision with which they also support the resistance of the network.
After all, it is not only a matter of the nodes being geographically distributed worldwide in networks of various data centre and backbone providers. Each ADA-holding delegator can decide for itself whether to follow a herd instinct and support an already very large pool operator who may already be running several pools. In the vast majority of cases, these are all operated at the same location and by the same servers.
If these pool clusters become too large, they generate a lot of blocks. And if they fail – for whatever reason (fire, attack, error, carelessness …) – this has a noticeable impact on the stability and credibility of the Cardano network. Much more than a whole burned down datacenter.
Let’s take the very well-known and still growing 1PCT pool cluster as an example. All of its current 28 pools operate through only two publicly registered relay nodes. And if you break down the two hostnames, you can even see that they have the same IP address, so they run on only one server. One would think that the 500-900 ADA or 600-1000 $ in rewards that each of these 28 pools generates for the 1PCT operator every 5 days should allow a higher investment in his infrastructure.
Considering that the 1PCT pools currently account for slightly more than 5% of all delegations, and thus generate blocks at this rate, it is strange that only one of the currently 2500 active and public registered relays of the Cardano network are provided by 1PCT. Once IOHK no longer runs hundreds of relay servers for all Daedalus wallets after full decentralisation is achieved (d=0), it is we stake-pool operators who will have to make this infrastructure and resources available to all users.
So as I said before, each delegator should consider very carefully which pool operator they support. I recommend considering only those operators who consciously and transparently operate one single pool. In good conscience for a central, fair and resilient Cardano network.
Please read more here about how to choose a stake pool wisely.