Published on Feb 14, 2021

The inevitability of decentralization


Earlier this week, I was on the phone with my bank for over an hour. When I finally spoke to the agent, they told me that my identity would need to be verified by someone in the bank branch that knew me personally in order to complete the transaction. I have to admit, I was a bit taken aback. How does this type of process still exist today? It was a sharp reminder that we’re still leaving with systems designed in the last century, specifically designed for centralized control.

The advent of the internet changed this and I believe we’re seeing an important societal struggle play out in front of us. The decentralization of information systems is leading to dispersion of power and will ultimately unlock individual sovereignty. I suspect this will lead to a great amount of instability and conflict.

We’re already seeing this play out in front of us in rapid succession. The capitol riots in the US, the Reddit movement against Wall Street, past elections and many other real life incidents have been fueled partly by the ability to connect & exchange online. There are no more gatekeepers that decide what can be shared and spread. Many will point to individual companies as the scapegoats for these societal disruptions. I believe that this blame is largely misplaced. When it is technically easy and seamless to share a piece of information, any and all information will flow freely.

Meet the new boss, same as the old boss

One can argue that today’s technology platforms are a mirage of decentralization. Sure, you have access to endless video content, web pages and social networking but with one stroke of the keyboard a foreign agent can take that all away (and they often do).

This is not malicious, they are simply for profit businesses. They have a fiduciary responsibility to their shareholders to protect themselves and increase profits. When it becomes strategically important to remove a user’s right, more often than not, they will do so. Apple is one of the largest gatekeepers in this world and emphasizes closed versus open. Even Google whose cultural ethos was built on the open web is tending towards centralized control.

This appears to be changing. I believe that we will now see a movement towards true decentralization over the next two decades. If some people hated these big tech companies claiming they cause anarchy, I don’t believe they are going to like it when there is anarchy but with no one to point the finger at. I don’t say this as a cheerleader but rather that this will likely happen whether we like it or not.

Individual sovereignty

The world of crypto  is weird and fascinating. There’s a lot of hype around Bitcoin and cryptocurrencies. While I’m not an expert on this world, I do see a few technical breakthroughs that have massive potential. For instance, the ability to programmatically trust an individual. It’s starting with decentralized finance but will likely spread to new areas too. Some of our tools are being completely decentralized thanks to open source. Messaging platforms like Telegram will continue to create ways around centralized gatekeepers. This is an area I’m interested in learning more about. From an outsider perspective, it appears that we’ve opened Pandora’s box. Just like we saw the rise of many digital companies, we will see these decentralized projects spawn many new products and services.

Conflict on the horizon?

We’re still early in this process of decentralization. To a few, this appears to be manifest destiny. We will have much more control over how we live and this will lead to a utopia where we’re all empowered to live our lives on our terms. I’m a bit more sceptical. What happens when there is schism between people believing in constructs like religions and countries and others do not? These are questions above my pay grade.

I’m excited to see what’s next and ultimately believe this is a good thing. Given people more power and control will lead to better outcomes and quality of life. I just hope the road to get there isn’t too messy.

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