Decentralization

Written by Steve Miller

Introduction

Decentralization is the dispersion of authority away from centralized control. Blockchains are viewed as vehicles for implementing decentralized systems because they empower individual users and are able to operate absent centralized authority.

Consensus is achieved on the state of the network by coordinated agreement among nodes rather than a trusted authority, such as the U.S. Government dictating the value of a $1, or Facebook recording and storing your personal data.

Decentralization is a critical factor in securing distributed systems like blockchains. Relying on a network of nodes for security makes them more robust and resilient to attacks than centralized security models with a single point of failure. This is an important element of building a sound cryptoeconomic foundation. Widely distributing fees to service providers providing the security needed for transactions to take place. So the loss of any one service provider does not compromise the security or functioning of the blockchain.

Peer to Peer communications to initiate and confirm transactions further decentralizes networks and makes them more resilient. Empowering network users to communicate directly with each other, as opposed to relying on the centralized routing of messages vulnerable to censorship and attack.

Making permissionless access to the network is an essential requirement for decentralization, with no centralized authority governing who can or cannot initiate communication with other users across the protocol.

Suggested Reading

Why Decentralization Matters by Chris Dixon

The Meaning of Decentralization by Vitalik Buterin

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