On-Chain Analysis of Network Decentralization in Cardano Post-k Adjustment

Abstract

Cardano, a major Proof-of-Stake (PoS) blockchain, aims to achieve decentralization through its reward distribution mechanism governed by the protocol parameter k, which defines the ideal number of reward-receiving stake pools. While k plays a critical role in shaping network dynamics, its current value is statically determined and lacks a formal theoretical basis.In this study, we conduct an empirical analysis of Cardano’s on-chain data to evaluate the effects of changing k on decentralization metrics such as the number of active pools, stake distribution, and the Nakamoto coefficient. Our findings show that while increasing k initially enhances decentralization, the long-term effects are limited due to dynamic shifts in pool performance and stake concentration.Based on these insights, we propose the foundation for a dynamic optimization framework that determines the appropriate value of k by integrating decentralization, operational cost, and behavioral factors. This work contributes to the development of sustainable and fair PoS governance through data-driven parameter tuning.