Decentralization in Blockchain: What it is, Advantages and Disadvantages

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Internet users have become very interested in breaking free from the restricting control of third-party internet providers and getting whatever service they want without intrusion of privacy. Little wonder why Web 3, Blockchain and Decentralization have gone on to be the biggest global buzzwords of this revolutionized era.

In this article, we will take a quick dive into the uniqueness of Decentralized Blockchain that has gotten the attention of every average internet user, and the advantages and disadvantages associated with it.

What is Decentralization?

Decentralization in blockchain is the transference of decision-making power and overseeing authority from a centralized governing body to a distributed network. It eliminates the control and meddling from any individual, group or government thus restoring fairness and equity to the participants of a network.

When Web 3 was launched, its biggest aim was to give users ownership and control of their data by eliminating the need for large tech companies that act as middle-men.

Regardless of the belief most people have, that there is no public leader or face representing their network, decentralization doesn’t necessarily mean the 100% absence of leadership.

Governance in the Blockchain space is managed in systems called Decentralized Autonomous Organizations (DAOs) where power is shared amongst users in the form of tokens. Though users with more of these tokens, known as Whales, wield more control over the system than those with less, every user still has a say.

Smart contracts, a set of programmable computer codes, carry out specific instructions that have been voted in the DAO. And because they are computers and not humans, the issue of trust– one of the biggest flaws in a centralized system– is addressed.

Advantages of Decentralization in the Blockchain

There are many advantages of decentralization but only a few will be considered in this article.

  • User Control: In decentralized networks, users are able to commence or end a transaction without needing authorization or permission from a centralized government (third-party).
  • Protection from external censorship: Unlike what happens in centralized systems, no government can meddle or impose restrictions, bans and conditions on the network.
  • Anonymity: Decentralized networks reduce the extent to which a trust is needed to transact. No one has to know or trust anyone for a transaction to occur. Users can decide to protect their identity and hide personal information from the public and still make transactions on the network.
  • Transparency: Every transaction record is stored in a digital ledger that every participant in the network has access to.
  • Security: The way decentralized networks handle data makes them more secure than centralized networks. Cryptographic encryptions are employed to ensure that the data ledgers are secure.
  • Open Development: Decentralized networks are open development platforms that give anyone the privilege to improve on it by building cool tools, services and products on it.
  • Immutable: The data stored in a decentralized blockchain is nearly hard to alter or even delete because each alteration must be validated by each node in the blockchain network.
  • No Single Point of Failure: In decentralized systems, the crash single node cannot make the entire network down. Unlike in centralized systems where for instance, it becomes hard to do a transfer once a bank’s website is shut for maintenance.

Disadvantages of Decentralization in Blockchain

One might wonder how such an incredibly helpful system would have disadvantages. Alas, here are some flaws decentralization has;

  • Crime: Due to the anonymity and privacy decentralized blockchains offer, they have become the most preferred tools for criminals. It has enabled the financing of illegal activities since culprits are not easy to detect.
  • Cost: Decentralization is one of the many features a blockchain offers but it is expensive to maintain, and most times, it is traded for functionality.
  • Volatility: Most cryptocurrencies that are operate on decentralized blockchains are very volatile and fluctuate a lot. This is partly because they are still new and a lot of people and groups are considering its adoption.

Decentralized blockchains will not necessarily fix all the present internet issues but they have promised a better approach. If the issue of crime can be looked into and managed properly, decentralization stands a chance for faster adoption.

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Nwosu Precious

@elite_audacity
Beauty|| Web 3 Writer📝. Content Volunteer @campusbcatHQ 🚀. I'm all about growth and building beautiful relationships💙
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