Crypto academy season3 beginners’ course-homework post for Task2 by @yousafharoonkhan: Blockchain, Decentralization, Block explorer.

Greetings steemians, hope all is well with everyone. I would like to thank @yousafharoonkhan professor for taking us through this homework test and giving us an opportunity to pertake giving details on what we have understood about decentralization.

Home work Tasks

DEFINE DECENTRALIZATION. DESCRIBE THE ADVANTAGES AND DISADVANTAGES OF A DECENTRALIZED SYSTEM.? IN WHAT AREAS OF LIFE CAN A DECENTRALIZED BLOCKCHAIN BE HELPFUL?

Define decentralization

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In most cases decentralization refers to the transfer of authority from the higher levels to the lower levels in an organization. This simply means that in a decentralized system, all members in an organization or association are equally empowered and have the authority to make decisions independently.

Decentralization is a blockchain system considered to be one of the most important advantage of cryptocurrencies. It doesn’t mean cancelling services and functions that are done by centralized entities but rather decentralization means that those functions and services are distributed to the many entities. This saves the organization from many problems such as corruption because everyone has authority in the organization and they all are equally empowered to support the organization.

With decentralization, all transactions, records and data that are used in the computer system are secured and they are transparent for easy access by all the members in that organization.

Blockchain itself is a specific type of database in a system of recording information in a way that makes it difficult to change, hack or cheat the system. Blockchain is a type of Distributed Ledger Technology in which transactions are recorded with an immutable cryptographic signature called a “hash”.

Describe the advantages and disadvantages of a decentralized system

The decentralized system has the following advantages;

• Quick decision making.
In a decentralized system, decision are taken and made by the authorized personnels. There is no third party interferences when making these decisions which makes it easy to transact.

• Better supervision and control
A decentralized unit makes it easy to control and supervise each member and all the activities that run in the organization. This is because all members share equally authority so everyone is responsible towards the operation ma of the organization. This leads to a high efficiency.

• Security
In a decentralized system, all transaction data and records are secured because of the use of advanced technology like computer systems. It is very hard to cheat or change data stored on the computers and Incase of any fraud and hacking, the computers alert the users about these unusual issues. For example when transacting, the owner of the account receives a notification as a way of awareness about what is going on with the account.

• Growth and diversification
Under decentralization, every single member attains sufficient autonomy to exercise their creativity. In this way, there is a healthy competition amongst all entities which gives room for more research and better managerial skills.

• Transparency
The decentralized system is very transparent to all its users which helps in reducing cases of fraud, because everyone is always alert and can see what is going on with different accounts. In this way, victims of fraud can alert other members and take necessary precautions.

• Efficient communication
There is a wider span of management since everyone is equally empowered hence making communication systems more efficient and easier because there is free access to talk to any member in the organization.

• Satisfaction of human needs
Decentralization serves an important tool of satisfying its users’ needs of independence, power, prestige, and status. Each user is always responsible towards the systems betterment.

• Ease of expansion
The decentralized system can easily expand because of free entry of more and more people to use it. There are no strict restriction requirements for its users to join hence making it easy to grow at a higher rate.

However, decentralization has disadvantages which are as follows;

• Expensive
The decentralized system is expensive because it requires higher expertise to operate. There is a high level of money transfer from one user to another and it requires one to know much about crypto so as to understand how to operate with the system. Expenses are also faced during the time of responding to the financial needs of each members at specific times.

• Difficult to control
The decentralized system is again hard to control because it has no specific high authority which brings people to order.

• Slow transactions
In the decentralized system, before transactions are confirmed, nodes need to approve and validate the transaction which leads to slow transaction time.

• External factors
There is threat for interference of external factors in a decentralized system. Such as the government, uncertainties, and others.

In what areas of life can a decentralized blockchain system be helpful?

Health sector
Applying the decentralized system in the health sector is very crucial and important because patients’ data is safe and well secured. Due to its transparency, it enables different health workers ho are operating on the patient to this data . Patients eat their hospital records and keep them and Incase they loos them, they can go back to the hospital library and check for these details because they are stored fir many years.

• Voting
During voting, the decentralized system is employed to enable everyone access details on how the voting process is ongoing so as to create a good follow up of different participants. This helps in reducing cases of cheating during the elections.

• Business sector
Big businesses apply the decentralized blockchain system because of need to store their records safely in computerized systems. The business records are stored and kept about the daily sales made and purchases so as to create records for referral and easy follow up.

• Banking sector
The decentralized blockchain system helps to increase the speed of transactions through reducing time the banks are able to operate hence pushing their services beyond working hours, funds can still be sent and received online faster which also reduces cases of theft at banks.
The decentralized system is also applied in storage of data and records of the different people who use the banking sector.

In conclusion, the decentralized system is very important in the society because it is easily accessed by many users without any interferences however it also has some negative issues as stated above.