University of Princeton Professor Echos Decentralization is Currently Overrated


A Princeton Professor called Arvind Narayanan wrote a series of Tweets explaining why he believes that decentralization is currently overrated. He has also talked about decentralized projects that failed and how reality has proven different than expectations.

In a recent article released on The Register, he wrote that a recent study showed that blockchain technology had zero percent success when applied in real life. However, he said that the technology is sound and interesting.

According to him, centralization emerges naturally if there is a free market due to economies of scale and other efficiencies. He went on saying that absence of government intervention does not mean decentralization, indeed, it generally means the opposite.

He put several examples of different industries that tend to centralization when there is no regulation. He explained that after airlines were deregulated in the United States back in the 70’s they created a hub-and-spoke model, transitioning from a point-to-point model.

He has also mentioned how crypto mining evolved. It started with CPU followed by GPU, and ended with FPGA and ASIC miners. Here there was also a centralization of the economic activity in a free market. The same happened with gold mining starting with gold pan and sluice boxes ending in placer and pit.

According to him, there is no conspiracy to centralized, instead, the market itself pushes individuals towards centralization.

Professor Arvind Narayanan says that to succeed, decentralized platforms must attract developers and foster an ecosystem of services. This would allow the platform to improve its quality and also its functionalities. However, this is something that might take decades.

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