Why decentralise?

Writing for my clarity. Hopefully, can help others as well.

Centralized control

A lot of archaic institutions (eg: banks) or even new age platforms (eg: Fb, Insta) have centralized control, to the extent that the authorities have the final say. Be it our data (our personal information, our activity) or our money (do we know who the banks lend to?), we do not have visibility, leave aside control.

Some everyday examples all of us can relate to:

1. Social media platforms: We all have been victims of moments where we are inundated with ads on topics that we were discussing with our friends. Are they hearing us? Are they reading our messages? We are left wondering.
2. Spam: All the spam calls (donate to this charity, home loan, etc.) have left us frustrated resulting in us being rude to the caller or downloading Truecaller to block spam. Where are they getting our data from? Did our banks share this information? We are again left wondering.
3. Banks: Did you know that if you do not make a transaction with a debit card in 6 months, banks deactivate their online use without informing you? Or do we have any idea who the money is being lent out to, what collateral (if any) is being furnished. And voila! One day we wake up to some banking scandal and our money going bust!

So is centralization all bad?

No, not at all. Social media has helped the world stay connected and given voice to many. Banks keep our money safe and even help in growing it. The problem arises when abuse of power happens and things go wrong. When the custodian, rather than acting as the custodian, acts as the owner. When the interests of a custodian supersede that of the actual owner. When custodians forget they are in-service to us. When the trust in the custodian falls apart. I think you’ve got the point :)

Also, in many cases, custodians acting as owners is not malicious in intention. It’s just a natural extension of a network/group growing huge. As the groups become big, it’s difficult for the central authorities to pay heed to all needs, all use cases and all users. So users lose out and feel violated and excluded.

And let’s face it, we all have an inherent distrust of platforms/institutions that become too big to fail. And we are not to blame for it.

So what problems does centralisation bring?

Lack of complete ownership:

As mentioned before, when central institutions dictate policies or take decisions on behalf of us (our data, property rights, our actions), which are not in our interest, it becomes a problem. The sense of — hey it’s my money, my work, my <anything> — is very strong in human beings, and this entitlement being taken away causes us to become helpless, anxious and angry.

Let’s talk about types of ownership, and the threat to them:

Ownership of identity (Who I am):
We have government IDs, facebook logins as a proof of our personal and communal identity. It gives us a sense of belonging and a sense of self (in the material world)
What if someone takes that away from us? What if the government decides we do not belong to this country because we lost all our identity proofs? Or what if Instagram blocks your account and you are left wondering why! We will be left proving who we are.

These might seem trivial to us and get dismissed, but this is a real problem especially among the minorities, the under privileged and immigrants.

Ownership of things (What I possess):

As much as it does not matter spiritually, we are attached to material things in life, because we have worked too hard to obtain them or have been bestowed the right to. Our house, our money, our jewelry passed down from generations, our car, our right to vote and the list goes on.

What if this ownership is taken away — What if someone pays municipal corporations to change the records? What if your vote for party A was changed to party B? What if your money is being lent to bad actors in the corporate sector?

Very real problems in countries with broken political institutions and dysfunctioning governments.

Ownerships of one’s creation (What I create)

This is more relevant to artists / creators, who put in a lot of work in composing music, or paintings or written articles but are plagued by the forces of plagiarism. Creating digital copies dilutes the authenticity of creations, taking away the credit (both monetary and non monetary) from the original creators.

Given the discovery of art (of any kind) is mostly via central platforms (Spotify, facebook, etc), creators are dependent on them for reach and monetisation opportunities. The avenues of monetisation are limited to a platform commission (decided by the central platform) or brand partnerships (again at the discretion of the platform). Also, If the platform decides to shut down, their work is lost.

Ownership of actions (What I do)

This is something we can relate to, not just because we have experienced it ourselves but the entire discourse around data privacy in the US and in India. Do we want other parties to know that we are looking for lingerie so that they can show ads to us? Do we want to share the data on our online actions with others? What we liked, what we watched, what we scrolled. For some users this is a 1984 parallel while for a lot many this is pure frustration. And today, we don’t have a say on these platforms on the data that belongs to us.

Can there be a way in which no one can take away or alter our ownership rights? Can there be a pure place where truth prevails at all times?

Lack of transparency

Centralisation comes with its own challenges of maintaining transparency. Transparency in data, its usage, in financial dealings is something which is missing. Are third party audits of company financials sufficient to protect the interests of users? What about collusion between the corporate firm and an auditor? Cannot data be altered by the company that is in-charge of it? What about the government financial dealings, do we have any inkling of where our taxes are going? Answer is a no to all the above questions.

These are real problems which have caused scandals (Enron, PNB) and hard earned money going bust. And each one of us is aware of the corruption that plagues government institutions.

Can there be a way in which all the data is publicly available (as much as possible) and which is tamper proof?

Discrimination

Since centralisation vests power in the hands of a few, the policies they decide can be discriminatory in nature. Some people are subjected to exorbitant interest rates or some may be denied based on their religion, caste, etc. Also lack of options or access lead the under privileged to middlemen which we know are notorious for not only high interest rates but for inhumane ways of working.

Other than lending, discrimination may also lead to one’s voice being suppressed on social platfoms. What if a platform decides to block your access because you’re pro Trump or pro Biden? What if a bank refuses to lend you money because you were seen as participating in the anti government protest? Where would you go from here?

Do not have proof this is happening today, just citing them as a possibility.

Can there be a way in which any user, irrespective of nationality or religion or political views, can be eligible for products and services of their liking, without taking any permission?

Single point of failure

When facebook went down, all the work as a creator, all our pictures, all our connections, all our communications also were lost briefly. This highlights the importance that Fb or Fb like platforms hold in our lives, but it also shows that like any other system they are not fault proof. Also, being fault proof becomes even more pronounced in financial systems where our hard earned money is at stake. Are we confident that the digital infrastructure of our archaic banks are hack proof? I shudder to even think about it.

Can there be a way in which the single point of failure is minimized as much as possible?

High middlemen cost

For sellers, writers, artists,etc. a centralized platform helps in reach and monetisation (little). This often comes at a cost, in the form of a platform commission which the supply side makes to the platform. While this is not a big problem for big service providers / creators, it pinches the smaller players in the supply ecosystem. Drivers having to shell out 20% of their commissions to Uber, immigrants having to pay a cross border payment fee to their banks — are just two of the many examples.

Can there be a way in which peer to peer interactions/transactions can be made feasible at lower cost?

Uneven distribution of value

We all know the big players like Spotify or Instagram or TikTok or Fortnite rake in billions of dollars every year. And why should they not, these are players that have disrupted the internet space and have given voice to many. But more often than not, the success of the platform is not evenly trickled down to its participants.

What if the artists / creators also could put a monetary value to the views or likes or engagement with their fans? What if the artists can have a say on how they want to monetise their work? This also ties in with the ownership aspect, where to truly own something also means to decide how to make money off it.

Can there be a way where participants have the freedom to put a value on their network worth?

For all the questions that were asked, BLOCKCHAIN (a distributed digital ledger) is here.

Hope to write more in the coming months!