1.7 Decentralization of the Blockchain Network
In the blockchain, decentralization refers to the transfer of control and decision-making from a centralized entity (individual, organization, or group thereof) to a distributed network. Decentralized networks strive to reduce the level of trust that participants must place in one another and deter their ability to exert authority or control over one another in ways that degrade the functionality of the network.
Advancements in the digital domain are progressively molding people’s everyday life progressions, businesses, academic organizations, companies, and governmental associations. However, the hypothetical systems of administration that are being utilized concerning these have not progressed at a similar speed. To resolve this, the decentralized application of blockchain technology has emerged as one of the best technologies. It is generally seen as a tool that can give answers for numerous concerning points like digital identity, ownership of assets and data, security, and, surprisingly, future decentralized decision-making. Decentralization is not a newconcept.
When building a technology solution, three primary network architectures are typically considered: centralized, distributed, and decentralized. While blockchain technologies often make use of decentralized networks, a blockchain application itself cannot be categorized simply as being decentralized or not. Rather, decentralization is a sliding scale and should be applied to all aspects of a blockchain application. By decentralizing the management of and access to resources in an application, greater and fairer service can be achieved. Decentralization typically has some tradeoffs such as lower transaction throughput, but ideally, the tradeoffs are worth the improved 13 stability and service levels they produce. A decentralized blockchain network allows everyone using the network to have control over said network. This improves the functionality of the network and also strives to enhance people's trust in one another.
Benefits of decentralization:
- 1.Provides a trustless environment
- 2.Improves data reconciliation
- 3.Reduces points of weakness
- 4.Optimizes resource distribution