Crypto Academy Season 3 Beginners' course - Homework Post for Task 2: for professor [@yousafharoonkhan] Blockchain, Decentralization, Block explorer
(2) Define decentralization. describe the advantages and the disadvantages of a decentralized system. In what areas of life can a decentralized blockchain be helpful? (write in own words)
DEFINE DECENTRALIZATION
Decentralisation can basically be defined as the dissemination or sharing of power, control, decision making of an organization or firm to the users or local offices other than leaving the authority in the hands of a particular person or office. For example in a decentralised social media it's user have the right to post what ever they want without getting their content removed or banned.
DECENTRALISATION IN BLOCK CHAIN
Decentralisation in a block chain can be defined as the transfer of power/authority, control and decision making in a network amongst it's members instead of leaving it to one particular member or entity in the network. In a decentralised block chain, there is almost no need for trust because every member in the network has his/her own copy of exactly the same data. The data is stored in the structure of a ledger, if in any case the ledger of any member is corrupted or changed, it will not be accepted by the majority of the other members in the network.
SOME DIFFERENCES BETWEEN A CENTRALIZED AND A DECENTRALISED BLOCK CHAIN
| CENTRALIZED | DECENTRALISED |
|---|---|
| The power/authority is totally in the hands of one office or person which is usually the owner of the network | The users have power or authority in their hands |
| Easily hijacked/hacked | Not easily hijacked/hacked |
| Safety of account is not guaranteed | Accounts are safe |
ADVANTAGES AND DISADVANTAGES OF DECENTRALISED SYSTEM
ADVANTAGES
•Fast in decision making:
Because of the absence of a third-party interference there is no one to consult before making decisions in a decentralised block chain. This makes both decision making and transactions fast and efficient.
•Accuracy:
In a decentralised block chain all the transactions made are being verified and approved by mostly all the members in the network. This being done by a whole lot of computers prompts everyone to put in their efforts and this creates a very low chance for mistakes or errors since they're not been done by one person or office.
•Reduction in weak point
Decentralisation help in reducing the weak points of a network because there is no dependent in one particular member or office and a break down in one office cannot results to a general failure.
•Low transaction charges
The transaction charges in a decentralised system is low because of the absence of a third-party interference. The absence helps in reducing the cost of transactions in a network.
DISADVANTAGES
•Lack of Coordination and Cooperation:
In a system where every user has the right and power to make decisions on their own there may be issues in coordination as some may choose to do as they like leading to incorporation.
•Cost of maintenance:
The cost of developing and maintaining a decentralised system is always very expensive.
•Incompetency:
Giving power to everyone may not be good, because not everyone have the required skills or experience to operate and this may not result well for the organization/company.
IN WHAT AREAS OF LIFE CAN A DECENTRALISED BLOCK CHAIN BE BE HELPFUL?
•Personal Data Storage:
Applying a decentralised block chain in our personal life can turn out to be very helpful. It is safer for a person to store his/her bio(personal information) and some under important documents on a block chain. In cases where a document containing important details is lost he/she could always refer to the block chain and easily get it back.
• Health Sector:
This is an important area of life where a decentralised block chain can be applied in storing patients data because it is both easy to retrieve and store the data. In a case where different doctors get to treat one patient at different time intervals which may be weeks or days, it is easier for the doctors to get the patients data from the block chain rather than searching through drawers of files.
•Educational Sector:
This is also another area of life where a decentralised block chain should be applied in storing students data. Using my country(Nigeria) as a casestudy, it is not new to here stories of hostels or admin building getting burnt, or cases where the admins can't find the students data on the school register. If schools can adopt a decentralised block chain in storing data,students will neither suffer faith of documents getting burnt nor missing data on the schools register.