What is Decentralization? Blockchain Ecosystem

Blockcain_Ecosystem

When bitcoin emerged, it created a new kind of social thought movement in the online space. We got the word “crypto’ space and it has reiterated the word decentralization perennially, in every bitcoin/blockchain conference and recently, has been mentioned by the US SEC’s commissioner.

What are the fundamentals of decentralization? We will briefly discuss highlights from political to the technological paradigms which has been overly-used in this space.

Based in Cambridge’s dictionary the definition of decentralization is “ to move the control of an
organization or government from a single place to single several smaller ones.”

Vitalik Buterin categorizes decentralization in 3 different ways (Source: Medium):

  1. Architectural (de)centralization — referring to the number of physical computer the system is
    made up of.
  2. Political (de)centralization — referring to the individuals and organizations that control the
    system.
  3. Logical (de)centralization— referring to the interface and data structures that the system
    maintains.

Recently, SEC Commissioner, Hester Pierce, recently tweeted:

“Government central planning and decentralized tech would be an odd combination. I agree
with @digitalchamber that the private sector is the place innovation happens.”

When she recently spoke at the University School of Law in Missouri about Innovation & Entrepreneurship, she emphasized decentralization as such:

“ Decentralization is nothing new; it is at the root of our economic system; free markets draw on the talents and knowledge of people all across society to produce what society needs. No person or group of persons can serve as central coordinator because such a master planner would be
inherently less smart and less plugged in than the market, composed as it is of diverse individuals communicating with one another in the brutally blunt language of prices.”

As entrepreneurs and innovators like visionary leaders from Buterin has largely influenced the space. We noticed that the gatekeepers of productivity the US SEC has recognized that the most important thing is to facilitate innovation and create possibilities for start up companies to flourish.

However, we have to take this with a grain of salt and see how we can harmoniously collaborate in a global scale between innovative technology innovators with the governing central institutions.




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