Crypto Academy Season 3 Beginners' course - Task 2: Blockchain, Decentralization, Block explorer
Introduction
Greetings, hope you are good? I attended yet another fixed course, the 2nd task of fixed course, the lecture was about Blockchain, Decentralization, and Block explorer.
Q. Define decentralization. Describe the advantages and disadvantages of a decentralized system. In what areas of life can a decentralized blockchain be helpful? (write in own words).
What is Decentralization
Decentralization simple refers to a system that is not centralized, to put it in another way it simple the opposite of centralization.
Decentralization is the act of sharing power, control, and decision-making among all users within an organization or system rather than placing it in the hands of a single body. Centralized system has an authority that makes decision, users on this system doesn't have full control or full authority. Let's look at a centralized and decentralized social media for example. In a decentralized social media user have complete control and the ability to post whatever they want without fear of their contents or account being removed/suspended. This is totally different in centralized social media, here the central body can removed/suspended the user contents or account if he/she violate the platform terms and conditions.
Describe the advantages and disadvantages of a decentralized system.
The Advantages of Decentralized System.
Eliminate Central Authority: everyone has complete control over their account in a decentralized system, no boss or governor. Unlike the central system whereby the power and decision lies in one single body.
Accessable: Every activity carried out in a decentralized system is recorded on the public blockchain, which anyone can access anytime provided that there's an internet connection.
Transparency: since the activities carried out are recorded on the public blockchain which is visible to everyone, this implies that the system is transparent and help to eliminate unwanted practices such as fraud and funds mismanagement.
Cost effective: When compared to a centralized system, the cost of transacting on a decentralized system is quite cheap. This is due to the lack of third-party in processing a transaction, which helps to lower network transaction costs, resulting in comparatively cheap transaction costs when compared to a centralized system.
Immutability: this is one of the core feature of a decentralized system, data/information once recorded it stored on the system can never be edited, removed or altered.
Disadvantages of Decentralized System.
The cost of maintanance: decentralized system makes use of expensive technology, and the cost of operating and maintaining this technology is extremely high; maintaining this technology necessitates highly skilled people with extensive technological experience, all of which costs huge amount of money.
Non reversible: the Immutable nature of decentralized system means once data /information are stored it can never be removed or changed. In a scenario where a transaction was sent to a wrong address, with the Immutable feature this means the transaction cannot be reversed or changed, this means the funds is totally lost, this is one of the disadvantages of the system.
Lack of coordination: since everyone is free to work and make their own decisions, a coordination issue may occur. A centralized system, on the other hand, has a central authority that governs the system, and all members are obligated to follow all of the central body's laws and regulations.
In what areas of life can a decentralized blockchain be helpful? (write in own words).
Electoral Sector: Rigging of election is a bad practice common in the electoral sector today, with the aid of Transparency in a decentralized system election can take place in a free and fair manner. The decentralized system will make sure that elections performed are made public and everyone will have complete access to view the actual result. This can be used in a community or country election.
Health Sector: recording and maintaining patients data are sometimes difficult, with the aid of the decentralized system, the health department can use the storage facility to manage and store all the patients data and information, this information will be accessable to every doctor connected to the system.
Finance Sector: transaction on a decentralized system is very fast, and the fee is low this is because there are no middle man or intermediary involved, comparing this to the traditional system that take longer and charger higher fee to process a transaction since the transaction needs to be approved by the third-party before being processed. If the financial sector can adopt decentralized system, it will aid the financial sector to process transactions fast and also cost effective.
Conclusion
A decentralized system is a type of system that doesn't require any central body to govern it, implying that anyone have full control over it. This system offers numerous advantages that are essential in our daily lives. I believe If the system is fully implemented, it would undoubtedly alter and change our daily lives...
I'd like to express my gratitude to Professor @yousafharoonkhan for giving this special lecture.
Thank you all for reading!!
Hello @barh3line , I’m glad you participated in the 2nd task of the Beginner’s class at the Steemit Crypto Academy. Your grades in this task are as follows:
Recommendation / Feedback:
You have answered every question in detail. Thank you for performing this homework task.