The Meaning of Decentralization

Decentralization can be thought of as a single design challenge that spans three different, but interrelated elements: technical, economic, and legal. Understanding the differences in these elements is key to designing web3 systems because design decisions with respect to one affects the others.

The point of decentralizing an organization is to remove control from a single entity or group. Decentralization—among other things—creates censorship resistance, a redundancy against corruption, and makes the organization more resilient against technical failures. However, as we will discuss later, some DAOs might appear to operate smoothly, but a... See more

To Satoshi, decentralization was valuable insofar as it mitigated some other fundamental risk: censorship, platform security, corruption, etc. It’s the properties decentralization gives us that we care about, not decentralization itself.

In this thought piece, Vitalik challenges the question of whether decentralized decision making is effective by looking at three scenarios in which it is important and needed:

What do we mean by “decentralization,” anyway? It’s a capacious term, and in the past few years it’s been tossed around more freely than ever. Flocks of birds, free-market economies, cities, peer-to-peer computer networks: these are all considered examples of decentralization. Yet so, too, in other contexts, are the American public-school system an

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With no centralized authority, the control of a blockchain system is distributed throughout a network. But is a blockchain completely “decentralized?” According to Schneider, summarizing Ethereum co-founder Vitalik Buterin, consensus protocols like Ethereum “are architecturally and politically decentralized, but logically centralized, since they ma... See more