Gini Index Analysis

Definition ∞ Gini Index analysis is a statistical method used to measure the distribution of wealth or income within a population, or, in the context of digital assets, the distribution of tokens or voting power. A Gini coefficient closer to zero indicates a more equitable distribution, while a value closer to one suggests high inequality. This analytical tool provides a quantitative measure of concentration within a given set of assets or influence. It helps assess the decentralization of economic power.
Context ∞ In the cryptocurrency space, Gini Index analysis is frequently applied to assess the distribution of native tokens, stablecoins, or governance rights among network participants. News articles and research often cite Gini coefficients to discuss concerns about centralization of wealth or voting power in various protocols. This analysis helps inform debates on protocol design, economic models, and the overall health of a decentralized ecosystem.