This is the second part of my Decentralization topic, started with http://igorartamonov.com/2019/02/on-decentralization-part-i/, based on my presentation about a role of decentralization for a public blockchain.
In my previous article I’ve written about factors that could possible affect decentralization of a public blockchain. And if you start applying them to existing blockchains, it becomes clear that most of blockchains are guilty of one or two of such factors.
It’s much easier to sell centralization disguised as decentralization, and is very profitable. It seems that nobody cares about decentralization anymore. Maybe decentralization doesn’t even matter?
What is the problem?
What is the problem with centralization? It’s obvious that a Central Point is a Point of Failure, but what kind of failure in this case?
Any central point can be used to get some advantage. Control of a public blockchain is a power, which governments, big corporations and criminals want to control. Humans are weak point, they are especially exposed if they are part of that central point. Not necessary to destroy, but force them to do what powerful actor wants.
Most people think it’s impossible to force any changes, “because it’s Open Source”. Unfortunately not every problem is easy to notice, otherwise we wouldn’t have software bugs. Some backdoors can intentionally be planted in a code and pass all verifications, only authors would know how to use them. There are many examples of that.…
Last week at the Financial Cryptography conference I made a presentation about a role of decentralization for a public blockchain. Now I want to describe better my thoughts and position. I’m going to make few blog posts about it, this one is the first in the series.
If we will come to a decentralization metric from 0 to 100%, where 100% is fully decentralized blockchain. I believe that the average value for the top 10 blockchains will be less than 50%, likely less than 25%.
Most in the top 10 don’t even try to be decentralized. A centralized blockchain is a current trend, it is more effective for the most of the use cases and easier to compete in marketing, so most of the current blockchains are fine with being centralized.
If we speak only about the protocol, a peer-to-peer network, in most of the cases we have a decentralized network. That’s where people usually stop thinking about decentralization.…