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What is Decentralized? – Definition

What is Decentralized? – Definition

Decentralization has become a buzzword in our modern world. We hear it everywhere from the news to our schools, but what does it actually mean? Decentralization is an organizational structure that distributes decision-making power away from a centralized source of authority. This means that decisions are made by the people closest to the problem and not by a manager sitting far away from the situation. Decentralization can have many advantages, ranging from increased efficiency to improved communication. In this blog post, we will dive further into what decentralization is and how businesses can benefit from utilizing this approach.

What is decentralization?

Decentralization is the process by which power or authority is devolved away from a centralized body and given to smaller, more localized bodies. In the context of cryptocurrency, decentralization refers to the distributed ledger technology that underlies most digital currencies, as well as the decentralized networks that run on them.

Cryptocurrencies are often lauded for their decentralization, which is seen as a key advantage over traditional fiat currencies. Decentralized network structures tend to be more resistant to censorship and fraud, and offer greater transparency and security. However, decentralization also comes with some trade-offs, such as increased complexity and decreased efficiency.

The history of decentralization

In the past, most information and power was centralized. This meant that a small group of people had control over a large amount of information and resources. This made it difficult for new ideas and technologies to spread, because they had to go through this central authority.

With the advent of the internet, we’ve seen a shift towards decentralization. This is because the internet gives everyone equal access to information and resources. There’s no central authority that can control what you do or say online. This has led to a more open and interconnected world, where new ideas can spread quickly.

Decentralization has been further accelerated by blockchain technology. Blockchain is a distributed database that allows for secure, transparent and tamper-proof transactions. This means that there’s no need for a central authority to oversee or approve transactions. Instead, they’re verified by the network itself.

This new type of decentralized internet is still in its early stages, but it holds immense promise for the future. It could give rise to new forms of economic activity and help create a more open and fair world.

Types of decentralization

There are two types of decentralization: physical and logical.

Physical decentralization is where the infrastructure for a system is spread out geographically. For example, a company may have its servers in different countries to reduce the risk of a complete shutdown if one server goes offline.

Logical decentralization is where the control of a system is spread out amongst different entities. For example, a cryptocurrency like Bitcoin is decentralized because there is no one central authority that controls it. Instead, it is controlled by all the users of the network.

Pros and cons of decentralization

There are both pros and cons to decentralization. On the plus side, decentralization can lead to more democratic decision-making, as well as increased innovation and creativity. It can also help to reduce costs and increase efficiency. On the downside, decentralization can lead to reduced accountability and transparency, as well as increased complexity.

Why is decentralization important?

Decentralization is important for many reasons. It allows for more democratic and efficient decision-making, as well as increased security and resiliency.

Decentralization can help to prevent any one person or group from having too much power or control. This can make it harder for corruption to take place, and can help to ensure that everyone has a say in how things are done. Decentralization can also make it easier to adapt to change, as there is no need for a central authority to make decisions – anyone can do so.

Decentralization can also increase security, as there is no single point of failure that could be exploited by attackers. And if one part of a decentralized system goes down, the rest can still continue to function. This makes decentralized systems much more resilient than centralized ones.

How can I decentralized my life?

There are many ways that you can decentralize your life. One way is to start using decentralized applications, or dApps. dApps are apps that run on a decentralized network, such as the Ethereum blockchain. This means that there is no central point of control for the app, and anyone can use it.

Another way to decentralize your life is to start using cryptocurrency. Cryptocurrency is a digital asset that uses cryptography to secure its transactions. Cryptocurrency is decentralized because there is no central authority that controls it. Bitcoin, the first and most well-known cryptocurrency, was created in 2009 as a way to send money without the need for a third party, such as a bank.

You can also decentralize your life by creating your own content on the web. For example, you can start a blog or create videos on YouTube. You can also use social media platforms to share your thoughts and ideas with the world. By doing this, you are taking control of your own content and ensuring that it is not centralized on one platform or controlled by one company.


Decentralization is a concept that has been used for centuries and has played an important role in how societies are organized. Today, it is being applied to new technologies such as blockchain and cryptocurrency to create decentralized networks that bring power back into the hands of users. Decentralized systems offer improved security, transparency, scalability, and cost savings over their centralized counterparts. They are a powerful force for creating more equitable economic models and providing individuals with more autonomy over their data privacy rights.