^{Imagen by @joseangel1}

First of all, congratulations professor @yousafharoonkhan, it's a pleasure to have you here. Enjoy your reading, it was quite enriched

Let's get started

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Definition

Centralization: These are typical system models where all responsibility and decision-making power falls on a single element, in this case a server machine or an entity. Each client is connected to a centralized node which has the absolute power of all the transmitted information network. So there is a high risk possibility of being hacked, since the network depends on a central unit and if this node is adapted the rest would suffer the consequences, of course there are measures to mitigate these failures such as backups and servers in different places.

Decentralization: It is the counterpart of centralized systems, since it is based on the empowerment of its users, they do not depend on a single element or centralized node, but rather has a distributed or collective network for decision-making and system management. It has a higher fault tolerance and a low percentage with a tendency to zero, to be hacked.

Some of the main differences between decentralization and centralization system

The decentralized ones seek to mitigate hierarchical structures and decentralize decision-making processes. On the other hand, in the centralized, decision-making is carried out at the top of the pyramid by tying its users to the path taken by the directives, or simply accepting the course taken by the system authorities regardless of their participation or how they are affected. .

The control of the funds is a notable difference since the users in blockchain de-centralized are owners of their movements and instead in centralized systems the users must request permission from the exchanges to be able to move "their funds".

Additionally, anonymity is key in control systems that requires the user to provide information to identify themselves, while in decentralized blockchains it is possible to operate completely anonymously. This causes that many times there is mistrust in the veracity of the movements and facilitating illicit operations.

Centralized is easy to use while Decentralized is not easy to use. Centralized has high liquidity while Decentralized has low liquidity.

A fundamental aspect of decentralized blockchain systems is the immutability of your data, its storage is distributed in each block and server where it is stored, each block is nested and is immutable, no one can alter the record. Unlike what happens in centralized systems where this data with the proper permission can be altered or modified the records.

Advantages and Disadvantages of decentralized and centralized system.

Decentralized

Advantages	Disadvantages
Facilitates communication between users without the need to go through levels	The community is not always focused on a course to follow
It has high security so it is difficult to be hacked	A high percentage of illicit use
Users have greater confidence in themselves, having the power to make decisions and manipulate information.	Prices are not stable
It has a high tolerance to faults since the data is immutable and is not in the same place.	maintenance cost is high
Users have control of their funds	It is difficult to use

Centralized

Advantages	Disadvantages
Users try harder to receive more reward	Systems are weak so attacks are often successful
Funds Transfer Errors to the Wrong People Mitigated	Low levels are not taken into account in decision-making
Users follow the guidelines established by the top authorities	An explanation of the behavior of the systems is expected
Decisions made are made faster	Users are generally not treated equally
High level of settlement as prices are more stable	The data can be modified if the authority has the necessary permissions

Which one is better for Business/trading and why?

It depends entirely on the needs of the company, one must know the nature of the company very well and see if its objectives can be satisfied with one model or another. A lot of research is required before deciding which model to take into account, and it would be recommended to consider mixed use, or plan to make future changes between the models. The ideal is to adopt the best of each solution based on the characteristics of the company, complexity of the project and time required to implement.

^{Imagen by @joseangel1}

How do you know if a blockchain is decentralized or not?

Thanks to sites like Etherscan the Ethereum Blockchain explorer, a decentralized platform for smart contracts, it is possible to review certain aspects of Blockchain contracts making possible even an internal revision of source codes. Where certain metrics can be located in the writing that will tell us if it is a centralized blockchain system or not.

Conclusion

It is necessary to know the concepts well to decide which option to use in our company. As we see both options are viable according to our needs. And both models of systems have their advantages and disadvantages. We must also bear in mind that these models can be used by any information system. So it is ideal to assume a position ready to change at any time and thus adopt the best of each solution. It is necessary to note that Blockchain systems are the ones that have the greatest advantage today due to the security they provide and the powerful level of encryption they have, the interesting thing here would be to use these 'new' technologies.

Links of consulted sources to expand the concepts and research

^{https://academy.bit2me.com/tipos-redes-criptomonedas/#a758148628841f1a8}

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Cc: @yousafharoonkhan, @stream4u
_{Jose Angel Silva, Venezuela.}
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