Define decentralization
Decentralization has to do with transferring power,control and decision-making from a centralized entity to a distributed network. This centralized entity might be in form of an individual, organization,group or government. The main focus of a decentralized network is to reduce the level of trust that participants place in one another, and prevent their ability to assert influence, authority or control over one another in such a way that will reduce the functionality of the network.
Decentralization is the direct opposite of centralization wherein a single authority is allowed to manage and control the system. For example financial institutions, government etc. Centralization is not the best in any system. This is because any failure, malfunction from one point(for instance, from the top of the hierarchy) affects the whole or entire system whether or not, the malfunction or failure was a delibrate one.
Notable example of a decentralized network is Bitcoin. Bitcoin was designed as a remedy against the governments and financial institutions possessing, controlling money as a single entity. Whereas, a decentralized network gives every user the opportunity to assert their own authority, power, control over their own monies or network.
The Cryptoacademy community values decentralization whereby professors in the community are allowed to prepare and give different lectures on cryptocurrency and thereafter, a homework is given to the students to answer questions based on what they learnt and understood. It will not be easy and efficient if one professor undertakes or is allowed to carry out these tasks alone.
Advantages of a decentralized system
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i. Better Management
For a work to be carried out effectively and efficiently, responsibility must be shared amongst the members of that system. By so doing, there will be less errors and even though, there is an error,it does not affect the entire system. However,if there is one person, managing, controlling the system,it will result to poor management.
ii. Fast decision-making
The process of waiting for approval from a government or having to fill documents in the banks, sign and wait to take the rigorous process before one can be attended to makes it difficult for decision to be made. However, with a decentralized network,a user can make a decision fast, without any interference from a third party.
iii. Reduces stress or much work
With the example cited above,if a professor in this community is allowed to prepare lectures weekly and verify homework tasks of everyone who writes his or her homework tasks, it will be stressful on that professor. But, with Cryptoacademy practicing decentralization, the burden is shared amongst the professors.
iv. Low risk
Lack of middle men in the system or network reduces the risk. This is because a middle man can take the money gotten from the proceeds of the transaction and run away. But in the absence of a middle man, such practices will not occur. Thus, no risk in decentralization.
Disadvantages of a decentralized system
i. Increases Costs
The cost in a decentralized network is too expensive. Running a decentralized network,it will require employing more hands or trained personnel who are experts in the job thereafter, they are paid for the services they rendered.
ii. Difficult Coordination and Control
Since Power and control are shared amongst constituent units, there will be difficulty in asserting control which may bring inconsistencies in the work place. There may not be uniform procedure in performing tasks in the sub-division. This makes coordination extremely difficult.
iii. Lack of Qualified Managers
Decentralization becomes difficult where there is no sufficient qualified number of staff to plan and function on the different units.
iv. Policies and instructions might not be followed
since there is no particular head, one person can't come out with an instruction and it is expected to be fully obeyed. since every person is the head in their sub-division, they may not easily adhere to instructions from the head.
In what areas of life can a decentralized blockchain be helpful? (write in own words)
Source
A decentralized blockchain system can be helpful in all areas of life in general. I will note the following areas.
a. Election
In every democratic state, there is always a periodic election carried out by majority of the populace. Now, to combat electoral fraud and transparency in an election,a decentralized system should be used. Blockchain will help release accurate results of the election and there will be no form of rigging in the election. With blockchain invoked, all vote cast can be counted correctly and it will be difficult transfer one's vote to another.
b. Health Sector
A decentralized system can improve the health sector. With the help of a blockchain, the records of patients who are undergoing treatments are to be kept properly for future use. Records of the kind of treatment given to the patient and the kind of ilment affecting the patient should be kept properly. With blockchain, there can be accurate data of patients as compared to when the data are kept properly.
c. Banking sector
With blockchain,a user can manage his or her account alone instead of allowing a third party to control and manage the account for the user. With blockchain invoked,it will encourage P2P kind of trading and not the kind of trading between bank or financial institutions and a person.
CONCLUSION
Decentralization is the transfer of power,control and decision-making from a centralized entity to a distributed network. The main focus of a decentralized network is to reduce the level of trust that participants place in one another, and prevent their ability to assert influence, authority or control over one another in such a way that will reduce the functionality of the network. Blockchain has come to stay to ease off workload that would have been controlled by an individual or group.