A slow but steady decrease in Cardano Stake Pools
Here I will take a close look at block production in Cardano since the advent of Shelley (epoch 209) in terms of Stake Pools participating in the protocol. These analyses were conducted independently and cover epochs 209 through to 539, spanning a total of 6,939,060 blocks. Over the total period analysed, 3229 unique Pools participated in the Cardano protocol (minted at least 1 block).
Shelley was launched in epoch 209, after which d was progressively decreased to 0 (reached in epoch 257). This parameter was eventually removed in 2022. When d reached 0, block production moved fully to Community Stake Pools (no more federated block production) (Figure 1).
Figure 1. The effects of the progressive decrease of d can be seen here, helping us identify the cutoff of epoch 257, which will be useful throughout the rest of this analysis.
Having identified this cutoff, let’s look at the trend in the number of Stake Pools participating in the Cardano protocol. Between epochs 209 and 257 the “Shelley Effect” is clearly visible (Figure 2). As d decreases, more and more Community Pools participate in block production, up to 951 Pools in epoch 257.
The maximum number of Pools contributing blocks in any given epoch was reached in epoch 301 (1151 Pools) (Figure 2). The minimum number since d=0 (so after epoch 257, included) was 944 Pools in epoch 342 (Figure 2). To clarify: epochs prior to 257 are not included in the minimum calculation because there was still a contribution of federated blocks, so block production had not fully been delegated to Community Pools yet (Figure 1).
Figure 2. Number of Community Pools contributing blocks to the Cardano blockchain over epochs since the launch of Shelley. The lines of best fit correspond to two separate linear regressions, with a cutoff at epoch 301, when the maximum number of Pools per epoch was reached.
Overall, the number of Pools regularly participating in the Cardano protocol (i.e., producing a block in at least 10% of epochs) was 1849. In the epochs following 257 (when d=0) the average number of Stake Pools contributing blocks in any given epoch was 1089, and in the same period 2919 unique Pools contributed to the blockchain.
Our models, no_pools ~ epoch, capture a good portion of the variability in number of Stake Pools contributing to Cardano (Figure 2). This means that the passing of time (epochs) has an influence over the number of Stake Pools participating in the protocol.
Before epoch 257 we see a quick and steady increase in participating Pools, with our model explaining over 90% of the data distribution (R-squared 0.9037, p<0.001). This is expected, as more and more Pools came online and got to participate thanks to the decrease of d.
Our second model analysed data from epoch 302 onwards (immediately following the peak in contributing Pools seen in epoch 301) (Figure 2). Here, we captured over 26% of the data variability and observed a slow but steady decline in number of participating Pools (R-squared 0.2634, p<0.001).
This latter trend indicates that the system is losing diversity of participating Pools since its peak in epoch 301. The retirement of Stake Pools through time is surely responsible for this trend, at least in part. So, let’s look at retirement of Pools next.
Since Shelley, 5956 Pools have registered. As we have seen in our previous analysis, approximately 54% of these (3229) have, at least once, contributed a block to Cardano. In the same period, 1733 Pools have retired (Figure 3). Retirement of Pools has not been linear: it appears to have peaked in rate around 2021 and to be now plateauing (Figure 3).
Figure 3. Cumulative number of Cardano Stake Pools retiring over time.
The epoch that saw most retirements was 442, with 29 Pools retiring. 287 Pools retired in 2020, 737 in 2021, 347 in 2022, 226 in 2023, 123 in 2024 and 13 so far in 2025 (up to epoch 539).
Overall, the number of retired Pools constitutes 29.1% of those that have ever registered. Of the 1733 retired Pools, 632 have minted at least one block (36.4%). The latter 632 retired Pools have minted in total 372,941 blocks (5.3% of the blocks since Shelley). Further, they represent 19.6% of the Pools with at least one lifetime block. These numbers are quite large and, together with the significant decline in contributing Pools over time, indicate that Pools are being “weeded out”.
Although the number of Stake Pools contributing to the Cardano blockchain seems to be stabilising (around 1000 in each given epoch) (Figure 2), there is a potentially worrisome declining trend. There are surely factors, other than Pool retirement, contributing to this trend: these could include the consolidation of stake into large Pools, as well as an increased influence of known Pool groups. These, and other factors influencing decentralisation of block production in Cardano will be examined in future analyses.
All Koios queries and R scripts for analyses presented here, can be found on GitHub at this link:
https://github.com/adrem1/block_data_analyses (01_blocks_by_pools)
CHANGELOG:
2025.02.28 posted analysis
2025.02.28 edited figure 2 caption for clarity
to Decentralisation Matters. In this topic I will regularly present the results of analyses that I conduct independently on Cardano blockchain data.
Cheers and happy Cardano analyses!
