Is the decentralization of the blockchain a “false proposition”?

The original definition of blockchain is: blockchain is a decentralized distributed database with the characteristics of decentralization, tamper-proof, and traceability. Rather than treating the blockchain as a technological innovation, the blockchain is first of all a mechanism design innovation.

Since the birth of blockchain, decentralization has been regarded as one of the core attributes of blockchain in the industry. But some people deny this, and some even claim that the word decentralization is a major misleading translation of the blockchain industry, calling for translation to be “point-to-point”. The rule makers of any blockchain application are the fundamental center. This statement is too absolute, and there is no such non-black and white statement in the blockchain.

Absolute decentralization is not better than absolute centralization. This is similar to the relationship between democracy and centralization. Centralization has the advantages of centralization, and the disadvantages brought by democracy, decentralization has also declined. Basically, the concept of centralization and decentralization is extended to the social system, which is centralization and democracy.

Blockchain does not directly bring absolute decentralization, it is just a tool that can be used for decentralization. Just as the parliamentary system, elections, voting, and separation of powers can be used as tools of democracy, different blockchains, depending on the consensus mechanism adopted, are almost like absolute democracy and representative democracy, which provide different democratic systems. Different degrees of decentralization.

The reason why people try to deny the “decentralization” feature of the blockchain may be because they mistakenly believe that decentralization is to supervise.

This is not the case. Supervision and “decentralization” do not conflict. “Decentralization” goes to the central controller and the intermediary, not the supervisor.

Blockchain technology never excludes supervision, and supervisory nodes can easily access any block chain network.

Due to the openness and transparency of the blockchain, regulators can monitor the transaction data of the entire system more conveniently, and because of the anti-tampering feature of the blockchain, once a transaction occurs, it cannot be changed or deleted. That kind of data fraud will deceive supervision. The situation is unlikely to happen, and it is more conducive to the supervision of market behaviors by the regulatory agencies. This shows that the blockchain will become an important tool for RegTech.

Blockchain is a decentralized technology, and it is an open platform like the Internet. Therefore, another way to study blockchain economics is to focus on the economic principles of decentralized systems, and study the blockchain as a decentralized technology.

Simply put, system evolution starts with centralization, because this is the most efficient way to create, establish, and formulate rules. This minimizes duplication, establishes a clear hierarchy, and resolves disputes.

However, it is precisely these characteristics of centralization that also mean that when power is easily exploited illegally, the cost of the system also begins to rise. In the economic system, this manifests itself in inflation, corruption, and rent-seeking. The cost of centralization continues to rise along the path of exploitation, and the decentralization brought about by technological progress will reduce the cost.

Ultimately, adaptation and survival of the fittest will drive these systems toward decentralization. The order produced by centralization is often too fragile, while the system brought about by decentralization is more stable, flexible, safe and efficient.

The flexibility, security and timeliness brought about by the decentralization of blockchain technology are exactly similar to the system form of the market.

In summary, the blockchain is a tool, but it is different from what many people describe. It is just a decentralized tool.

It is not that the use of blockchain will bring absolute decentralization, but that in the current society where almost any service or application must be provided in a centralized way, it provides a centralized way. Yes, it can provide a certain degree of decentralized service options.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/is-the-decentralization-of-the-blockchain-a-false-proposition/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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