Ineluctably, I get asked about it in every AMA session I do. It’s withal a topic I contemplate often and have on more than one occasion, shared my views such as in this blog post from 2019. Three years on, my views remain assuredly the same but the integrated time has given me the opportunity to integrate incipient depth and dimension to my cogitating this consequential topic. In essence, I believe the first thing to understand is that decentralization is not binary, and not single-dimension. There are multiple aspects to decentralization. CZ On Centralization Vs Decentralization
Every aspect is a gradient scale, not simply ebony-and-white. It is withal paramount to recollect that decentralization is an expedient to the goal, not the goal itself. The goal is liberation, security, and facilitate of avail. Many people may not concur with the above verbalization. I will explicate for what purport.
What Is Decentralization?
You may aurally perceive people verbalize “not your keys, not your coins”. These people incline to define decentralization as holding your own private keys. In this regard, TrustWallet (a Binance portfolio company) is decentralized. Binance.com is centralized. This is a fine view.
You may aurally perceive people verbally express “there are too few nodes or validators, so you are centralized”. While it is veridical the lower the number, the more centralized a blockchain becomes, there is no absolute number as a benchmark that everyone accedes on. It’s a gradient scale. CZ On Centralization Vs Decentralization
You may aurally perceive people verbalize “bitcoin mining is too centralized because the top 2 or 3 mining pools control more than 51% of the hash power”. This is withal veridical and is often utilized as a counter-argument by people forfending POS blockchains.
You may aurally perceive people verbally express “Ethereum is centralized because Vitalik can heavily influence its direction.” This has veracity to it. Blockchains with limpidly associated founders have this drawback. Bitcoin is more decentralized in this regard.
In Ethereum’s Bulwark
Again, it’s not absolute, but a gradient scale. You may auricularly discern people verbally express “bitcoin is centralized because a few addresses hold an immensely colossal number of coins.” Again, this is veridical to an extent. Dogecoin is even worse in this regard. One top address holds 30% of the total supply, and the top 20 addresses hold more than 50%. Like the validators, there is not an absolute number as a benchmark that everyone concurs on. It’s a gradient scale.
I can go on perpetually. But I hope you optically discern that decentralization has many different aspects to it. It’s often contextual and nuanced and I hope you commence the look past the binary nature of the initial argument. CZ On Centralization Vs Decentralization
Why Decentralize?
Because we don’t want a few centralized entities to have illimitable power over us, charge us exorbitant fees, control how we spend our after-tax mazuma, etc. We optate to give puissance, control and liberation to the people.
People want the liberation to transact, securely, with facileness, and with low fees.
Decentralization is an expedient to achieve the above and it will take time, collaboration and the trust of different groups.
Withal, we belong to such an adolescent industry, we are building the future a day at a time and taking giant leaps forward may not always engender the best results. What we do has to be in step with the rest of the ecosystem.
As an example, with the implements available today, most people are not able to secure their own wallets. The details of this are beyond the scope of this article but needless to verbalize, there are multiple hurdles we must solve for that decentralized future to take shape. Visually perceive Keep Your Crypto #SAFU (CZ’s Tips). Between being decentralized and potentially losing your coins, or utilizing a centralized accommodation that keeps your coins, most people today still opt to utilize a centralized exchange. That’s why CEXs are more popular today. CZ On Centralization Vs Decentralization
Conclusion
Having verbally before expressed all that. I/We are an immensely colossal before proponent of decentralization. At Binance, we believe in taking incremental steps as well as providing users with options for all available implements. Binance invests heavily in the development of both CEX and DeFi solutions and we will perpetuate to be advocates for a future where liberation and security can go hand in hand.