Decentralization of cryptocurrencies
Decentralization is a fashionable term, a buzzword of these days. With the more significant onset of blockchain or cryptocurrencies, the word is becoming more prevalent. Although no precise definition of decentralization exists, it is basically about power distribution. So how does decentralization differ from centralization?
Centralization is a process, system or method of control from one center. Typical examples include banks or dictatorships. On the contrary, a democratic system is more (but not entirely) decentralized since the power is transferred to the population. The legislative, executive and judiciary powers are also separated in a democratic system. The concentration of power is thus not abused to the detriment of the state’s population.
In a decentralized system, individual points can communicate with each other and do not need any center, as implied by the very word of decentralization. It is simply a system that is capable of self-government, without any interference or influence by the authorities, organizations, governments or its creator. It is not possible to artificially manipulate the records.
While almost everybody has heard about Bitcoin, the first digital currency to use blockchain technology, there are now more advanced digital currencies that use the advantages of the technology, but are able to provide something more on top of that. Either faster payments, lower transaction fees or simpler use or the possibility of staking, such as DeFi, creating digital art and tokenizing various forms of art, such as NFTs. PlatonCoin is a next generation of semi-decentralized cryptocurrency, which provides the advantages of the blockchain technology, combined with the security of strong partners, insured wallet and customer service.
Societies have been working on the principles of centralization for hundreds and thousands of years, and whenever something new comes along, it arouses fear and mistrust in people. Cryptocurrencies have the potential to change a lot.