Exploring and Analyzing the Token Ecosystem: A Complex Network Analysis Perspective

Abstract

The birth of Bitcoin created the era of cryptocurrency. At present, thousands of tokens are being published on blockchains, led by the popularity of Initial Coin Offerings (ICOs), launched by startups. Many have studied the token ecosystem from the perspective of economics. However, little is known about the characteristics of participants and tokens in the ecosystem. In order to fill this gap, and considering that more than 80% of ICOs are launched based on Ethereum, this article conducts a systematic survey of the Ethereum ERC20 and ERC721 token ecosystem to characterize the creators and holders of the tokens and transfer activities. By downloading the entire blockchain, and analyzing transaction records and event logs, we constructed three complex network graphs, a token creator graph, a token holder graph, and a token transfer graph. By analyzing these graphs, we are able to obtain many observations including token activeness distribution, token holder distribution, token relationship, and characteristics of token creation and decentralized exchanges. In addition, we propose an algorithm to reveal potential relationships between tokens and other addresses on Ethereum. The example shows that the proposed algorithm can effectively discover complex relationships between many accounts and find entities of addresses.