Crypto Academy - Season 4 | Beginners' Course | Homework post for Task 4: Blockchain, Decentralization, Block explorer

Question 2: Define Decentralization, Describe The Advantages And Disadvantages Of A Decentralized System, In What Areas Of Life Can A Decentralized Blockchain Be Helpful(Write In Your Own Words)

The Decentralization is actually refers to a form of organizational structure in which the daily operations and all the decision making responsibilities are held by the top management faculty to middle and lower subordinates. It is the process of transferring the power of administrative authority from central authority to individuals.

Centralization is a system that is being controlled by only a single authority which is also known as central authority. Decentralization is the opposite of Centralization. An example of Centralization is the Banking System in which the central Bank control and manage the affairs of other local banks.

A decentralization based network operates on a peer to peer mechanism in which the user computers are allowed to directly interact, and the personal information cannot be searched because your information is not accessed by the third party. In a decentralized system, there is not only a single authority for management and control of system. Instead of it, the decisions are taken by every unit which is connected to the system.

By the Decentralized system, the users controls the data of the system fully and the data is fully protected from the hackers as the data which is owned by a particular user only has the entrance to that data. Decentralization in Cryptocurrency space has given the management of token to the users rather than central authority. This came into reality in the crypto space with use of blockchain network that controls on algorithm.

In these days a lot of other blockchains are using the decentralization applications in order to protect the information of their users. first Cryptocurrency be made is the bitcoin network.

Features of a Decentralization:

1. The decisions are taken by every unit of the system.
2. Breaking into the decentralized system is very difficult.
3. Decisions are taken in a faster rate.
4. The member is responsible for a particular decision which is taken by him.

ADVANTAGES OF DECENTRALIZATION

• As the decentralized applications do not need any mediator for before the transaction of users, so the transaction fees of the system is very less if we compare it with centralized system.

• The Decentralized system is not operated by a single entity, rather it is operated by a group of persons because of which it makes the contribution of all users possible in taking decisions.

• It is very difficult for the hackers and scammers to hack the decentralized system because the users of the system have a full control over their own assets.

• As, the system of Decentralization is managed by a group of individuals, every user get a chance by which he/she can make his/her own activities and helps to make correct decisions which makes the development of system very fast.

• There is a clarity in the transaction activities of the system which makes it difficult for any dishonest transaction to happen.

DISADVANTAGES OF DECENTRALIZATION

• If you make a wrong transaction in decentralized system, then it cannot be reversed.

• The users who want to take part in decentralization must have a good experience and he/she must be an expert.

• The running of a decentalized application system usually wants high operation cost and so it is not suitable for small systems that has financial problems.

• In a decentralized system, getting a collective task is not easy, as there is a unique record operated by every unit.

• The Decentralized system is very complex in nature to build.

Decentralized blockchain in different areas of Life

The decentralized blockchain system is secured and it is useful in many of the areas of life. The different areas where the decentralized blockchain is useful are discussed below:

BANKING SECTION:
The information is a decentralized banking system can be compromised and tampered with, as it is handled by only a single unit. This helps the users much because they have a full control on their assets and can make transactions anytime.

POLITICAL SECTION:
The Decentralized system is very helpful in election process as every activity in decentralization is transparent and cannot be changed and so the chances of corruption are reduced much. Also, by this the citizens of country can take a free and fair decision of whom they want to make their leader.

HEALTHCARE:
The Decentralized blockchain system is beneficial in Healthcare Industry the employees can solve all health related issues very easily. Without any problem, we can take the advantage of getting guidance from our doctor and can know the medicines easily.

DOCUMENT CHAIN:
In the Decentralized document management system the data of any person is fully safe and secured. The data of a person is owned by him only and so he/she can easily access the documents all over the world without the issue of manipulation.

CONCLUSION

Decentralization is a system in which the decisions of making the leader of the country are not taken by a single entity. Rather, the decisions are taken by a group of entities in which both lower and upper level management take part. This is not like the centralized system in which the decisions are taken by top level management only. In this both levels take decisions and this makes the citizens of country to elect their ruler ina free and fair manner to live in happy manner.

I learnt much from the lecture of professor @yousafharoonkhan. Thanks to professor for making this informative and wonderful lecture.