  Decentralization is a key indicator for the evaluation of public blockchains.
In the past, there have been very few studies on measuring and comparing the
actual level of decentralization between Proof-of-Work (PoW) blockchains and
blockchains with other consensus protocols. This paper presents a new
comparison study of the level of decentralization in Bitcoin and Steem, a
prominent Delegated-Proof-of-Stake (DPoS) blockchain. Our study particularly
focuses on analysing the power that decides the creators of blocks in the
blockchain. In Bitcoin, miners with higher computational power generate more
blocks. In contrast, blocks in Steem are equally generated by witnesses while
witnesses are periodically elected by stakeholders with different voting power
weighted by invested stake. We analyze the process of stake-weighted election
of witnesses in DPoS and measure the actual stake invested by each stakeholder
in Steem. We then compute the Shannon entropy of the distribution of
computational power among miners in Bitcoin and the distribution of invested
stake among stakeholders in Steem. Our analyses reveal that neither Bitcoin nor
Steem is dominantly better than the other with respect to decentralization.
Compared with Steem, Bitcoin tends to be more decentralized among top miners
but less decentralized in general. Our study is designed to provide insights
into the current state of the degree of decentralization in DPoS and PoW
blockchains. We believe that the methodologies and findings in this paper can
facilitate future studies of decentralization in other blockchain systems
employing different consensus protocols.
