Steemit Crypto Academy Season4 Beginners' Course-Homework post for Task 4: Blockchain, Decentralization, Block explorer
The question for today is:
(2) 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)
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Decentralization
Decentralization implies putting something beyond the control of a single unit or entity so that way everybody will play a part in the process of control. It is effectively taking power from one person and giving it to everybody.
As our world is advancing the need to run a decentralized system becomes more pressing as it puts an end to corruption in various aspects of society.
Centralization on the other hand means that there is a single authority that is in charge of everything. This is just like the government of a nation; it decides what happens in the country.
A sector of the world's economy that gains the most from centralization is the bank and that is the main thing that gives the banking sector an edge over some other sectors of the economy. The banks manipulate the value of currencies and as such, they basically control the word. The advent of decentralization is a huge blow to the system of doing things already in existence, and that has made the adoption of decentralization by most countries and organizations difficult.
Decentralized Exchanges
We can't effectively talk about cryptocurrencies and blockchain without looking into decentralized exchanges.
All crypto exchanges are done on one decentralized platform, where you can't afford to make mistakes during transactions because they cannot be reversed.
In a decentralized system, all the transactions are untraceable, numerous transactions can happen at the same time, and there is no regulation.
Advantages of a decentralized system
A decentralized system is of great importance to every sector of the economy, the dominating cryptocurrency market, and even to private organizations.
Decentralization has so many advantages and we are going to discuss some of them.
Land dispute: This may sound funny but in Africa, land ownership is often a huge problem that takes numerous court hearings to solve and in some cases, it results in the loss of lives. As a solution, every land in a geographic location could be mapped and tokenized such that no piece of land can be sold twice. A decentralized system like this makes the need for numerous court hearings redundant. This is already in use in some places, and we still await the adoption of blockchain in property issues in more parts of the world.
Control of authority: This takes away power from a single unit and spreads it, be it government or whatever. Everyone has to be involved in decision making and as such misguided activities can not take place.
Elections: Decentralization in elections is dream come true. It basically makes election results tamper-proof because everybody is monitoring the activity in real-time and people actually get what they want.
It prevents malicious activities from happening, like hacking and stealing.
Disadvantages of decentralization
Decentralization breaks down power and in the process gives a faction of it to people that are unqualified and shouldn't be involved in decision making.
Decentralization slows down the process of decision-making in a system.
The use of money cannot be regulated in a decentralized system and as such unwanted activities could be going on. Some of the evil activities that can be carried out are money laundry, sponsoring terrorism, scamming people, and stealing.
Areas of importance
Like I have said before:
Land dispute: This may sound funny but in Africa, land ownership is often a huge problem that takes numerous court hearings to solve and in some cases, it results in the loss of lives. As a solution, every land in a geographic location could be mapped and tokenized such that no piece of land can be sold twice. A decentralized system like this makes the need for numerous court hearings redundant. This is already in use in some places, and we still await the adoption of blockchain in property issues in more parts of the world.
Banking System: In a decentralized banking system data/information is handled by a single unit and thus can be compromised and tampered with. We hear of credit card scams and other prevalent ones that are impossible in a decentralized system
Election: decentralization in the election process means that citizens of a country can actually elect who they want to be their leaders in a free and fair election. The election is free in the sense that as votes are cast electronically, the electorates can see the figures change in real-time, rather than sit at home and wait for some fabricated result to be announced.
Conclusion
Decentralization has proven to be prospective and important to the future of our existence as human beings and that is very good. Decentralization will make banking better in the future, it will make property ownership easier and make elections more transparent. Decentralization is a truly revolutionary concept.