Decentralization

Description

Alexander Lange:

"By using the term “decentralization” I refer to a process of redistributing functions, people, powers or things away from a central authority. The problem with centralized systems is that they lack transparency, allow for single points of failure, censorship, abuse of power and inefficiencies. The fundament of their existence often is missing trust within communities or networks, so they need a trust building intermediary to be organized. Paradigm shifts towards decentralized systems are enabled by new technological breakthroughs (i.e. blockchain, cryptography, consensus mechanisms), a rapidly growing developer community as well as new ways of raising capital." (https://medium.com/birds-view/mapping-the-decentralized-world-of-tomorrow-5bf36b973203)

Discussion

Technological Decentralization

By Chelsea​ ​Barabas, Neha​ ​Narula and Ethan​ ​Zuckerman:

"But what does “decentralization” mean? Echoing back to the rhetoric of the early web, re-decentralization advocates tend to focus on structural interventions that might realign power relationships between institutions (governments, corporations, etc.) and end users. Advocates like Brewster Kahle have urged open web advocates to investigate ways we might “lock open the web” with code, enabling more peer-to-peer interactions in the place of mediated private platforms. The urge here is to return to the 5 good old days of unmediated publishing without the need for third-party intermediaries who can exercise undue influence over our interactions online. In contrast to other strategies that might focus on legal frameworks or market competition, the appeal of structural interventions is that, in theory, they are less corruptible and more resistant to corporate and political capture. Structurally decentralized systems strive to avoid any chokepoints where a single actor can constrain use of the system, while hoping to preserve the usability of centralized systems.

In some ways, this line of thinking is a reincarnation of the Cypherpunk worldview, which first emerged in the 1970’s alongside significant developments in the study of cryptography. Technological advances in encryption, such as the widely used RSA encryption algorithm and the Diffie-Hellman key exchange, made it possible for an individual with modest computing resources to enjoy strong privacy protections, even in the face of governments and corporations with significantly greater resources. Many celebrated these technological breakthroughs as a critical safeguard for user privacy in an increasingly digital world. Still others–the cypherpunks–strove to harness cryptographic innovations in order to drive much broader social and political changes.

The intellectual roots of the cypherpunk movement are grounded in the work of people like David Chaum, who first proposed the use of cryptographic primitives to create anonymous digital cash in the early 80’s. Cypherpunks took ideas like this and 6 extended them even further. For them, cryptography was a critical vehicle for individual freedom, one that could significantly weaken the reach of governments and other powerful institutions. The most extreme adherents to the cypherpunk worldview embraced a philosophy sometimes referred to as crypto-anarchism, which envisioned a world in which all laws and regulations were supplanted by mathematically verifiable code. Important values and enforcement mechanisms could be encoded directly into software that would carry out critical social processes through the secure exchange of information.

Forty years later, the cypherpunk dream has not (yet) been realized. Security scholar Arvind Narayanan argues there is simply not a high user demand for upsetting fundamental power structures through crypto-enforced contracts, particularly in democratic societies where governments are chosen by the people. Moreover, the vision of code as a functional stand-alone governance institution breaks down amidst the reality of unpredictable and imperfect humans, messy social systems, and buggy code. In order for cryptographic systems to be practical, Narayanan argues, they need to provide clear paths to recourse for users when things go wrong. To do this, technological solutions must effectively interact with other modes of governance and enforcement, such as existing legal systems.

In spite of these struggles, the cypherpunk movement has experienced a renaissance in recent years thanks to the rise of projects like Bitcoin. Bitcoin is a peer-to-peer cash system that enables the secure exchange of digital tokens without the need for a trusted third party like a bank or credit card company. Bitcoin enthusiasts frame the potential of this technology in terms of its “decentralizing” impact. Rather than placing one’s trust in a closed network controlled by elite financial institutions, Bitcoin offers users an open alternative by “decentralizing” critical processes of secure value exchange, like transaction validation and currency issuance. The decentralized architecture of Bitcoin provides guarantees for certain user protections, such as resistance against censorship. Bitcoin achieves censorship-resistance through two mechanisms: First, there is no consistent mapping of digital Bitcoin identity to real-world identity -- anyone can join the system and create as many “accounts” as they wish. However, these accounts are pseudonymous, not anonymous, and identities can be uncovered by carefully examining the flow of transactions. Second, theoretically, anyone has the ability to verify and update the Bitcoin ledger by entering into a process known as “mining.” Mining is the process by which participants in the network process and secure new transactions. Mining is not gated, but practically, it lies in the hands of the few who are willing to make the financial investment in the necessary hardware. On the one hand, Bitcoin faces many of the hallmark struggles of a cypherpunk project -- it is cumbersome to use and demand for alternative financial services has not been high enough to push Bitcoin into the mainstream. At the same time, Bitcoin has captured public imagination and provided the conceptual framework for a new generation of projects that strive to distribute critical processes and services that currently fall under the purview of large, for-profit companies. Like the early cypherpunks, many of these projects seek to “disrupt” this new class of power elites–the digital platform owners–by developing peer to peer protocols for the exchange of information, and supporting crowdsourced methods for curating content and managing user reputation.

This school of thought has greatly influenced the thinking of open web advocates who are concerned about the increased consolidation of the web around a few large platforms. For advocates of an open web, the clearest path forward lies in a return to a more distributed web architecture, one that hearkens back to the early days online. Yet this framing of the issue fails to account for the fact that all of the centralized services that have come to dominate the market today were built on top of the distributed architecture of the original web.

Distributed, peer-to-peer protocols like HTTP and SMTP are still the functional rails on top of which today’s web runs. However, practically speaking, the web is now heavily consolidated around just a few service providers. This consolidation is most clearly illustrated in the distribution of online advertising dollars, which roughly reflects the distribution of viewership on the web. According to a 2016 report, 85 cents of every new dollar spent on online advertising went to just two companies–Facebook and Google. It appears that structurally decentralized architecture doesn’t inherently lead to 9 decentralized, competitive markets. This points to the need for developing a more nuanced understanding of the role that structural/technical decentralization plays in addressing the new class of risks to personal and political speech that we observe online today.

A good first step would be to recognize that structural centralization in and of itself may not be a negative development. Indeed, many positive benefits in terms of usability, efficiency and performance can come from consolidating resources and managing economies of scale. But these perks come with a cost. What we might gain in terms of convenience and efficiency, we then lose in terms of control and freedom. In developing a strategy to address contemporary challenges online, we must develop a more fine-grained understanding of what we view as the threats that accompany increased “centralization” of the web. Only then can we weigh the costs and benefits of different interventions intended to re-decentralize the web.

Some of those interventions might come in the form of peer-to-peer alternatives to corporate social media platforms. Others might be structural checks and balances that help us safeguard against abuses of power by today’s online hegemons. Still others might be hard coded structural limitations on power–ways to offload liability from large players so that they cannot comply with external pressures to violate important user rights, such as a user’s privacy or rights against self-incrimination. In order to understand which strategies are best suited for which risks, we need to get a more detailed understanding of the specific chokepoints we want to address." (http://dci.mit.edu/assets/papers/decentralized_web.pdf)

References

"Locking the Web Open: A Call for a Distributed Web | Brewster Kahle's ...." 11 Aug. 2015, http://brewster.kahle.org/2015/08/11/locking-the-web-open-a-call-for-a-distributed-web-2/. Accessed 19 Feb. 2017.

Chaum, David. "Security without identification: Transaction systems to make big brother obsolete." Communications of the ACM 28.10 (1985): 1030-1044.

Narayanan, Arvind. "What happened to the crypto dream?, part 1." IEEE Security & Privacy 11.2 (2013): 75-76.

More information

• The Centralized Web