Decentralization
Distribution of control and power among many participants instead of one central entity.
Decentralization is the fundamental blockchain principle — distribution of control, decision-making and data storage among many independent entities instead of one central one.
Why decentralization matters:
•Censorship resistance — no one can block a transaction
•No "single point of failure" — network works even if 30% of nodes go offline
•Trustless — no need to trust banks or authorities
•Immutability — no one can retroactively alter data
Blockchain Trilemma:
•Decentralization × Security × Scalability
•Hard to maximize all three simultaneously
•Bitcoin: maximum decentralization + security, sacrifices scalability
•Solana: maximum scalability, less decentralization
•Ethereum: balance with L2 scaling
Measuring decentralization:
•Number of validators/miners
•Hashrate distribution
•Geographic distribution of nodes
•Token concentration in insiders' hands
Centralized aspects of "decentralized" systems:
•Lido holds 30%+ of staked ETH
•Most Solana transactions go through Jito MEV relays
•Infura/Alchemy — centralized RPC providers for Ethereum