What Are the Key Metrics Used to Measure a Project’s Level of Decentralization?

Key metrics for measuring decentralization include the Gini coefficient or Nakamoto coefficient of token distribution, which quantify the concentration of wealth. Other metrics are the number of active validators/nodes, the diversity of clients used, the number of distinct governance voters, and the number of entities controlling critical infrastructure like oracles or multi-sig keys.

A higher number of independent entities and a flatter token distribution indicate greater decentralization.