Bitcoin Forum

When introducing new people to cryptocurrency.. how do you explain decentralization to them? Why is it important?

I would just say

"decentralization" is not using "off-block" mini banking nodes and calling them "Lightning Hubs" because not everyone is fooled

So called "decentralization" lead to miners ripping us off for $55 per transaction but now these scammers are being ran out of town
and you can pick up mining rigs for free
https://www.zerohedge.com/news/2018-11-20/whats-happening-now-crypto-devastation-collapses-hash-rate-forces-miners-dump-rigs

They make fantastic space heaters they do.

Actually it is very difficult to describe decentralization briefly because it is feared that errors will occur in interpreting the meaning, but if the meaning is decentralized blockchain, one of the parts is a system that is controlled by the users of the system.

There's a difference between describing with decentralized means and what it means for bitcoin. I would explain the definition of the word, or how I interpret it and it's as simple as there not being any one or more central entities that have control.

decentralisation is no central point of failure

however as the core bug last month proved where people needed to upgrade. and surprisingly had to upgrade from one source site. and also using code from one dev team that stayed quiet about the bug until they could patch it in secret and then go public once a patch was released. is not the case of decentralisation..

the network is distributed in as far as full nodes are concerned.
(and now comes the defenders who will mis-define and debate the definition of full nodes)

I just told my friends: Crypto is like the best way to hide your wealth, no one can know and control their money. Transactions are transparent and do not need to be passed on to any third party. You can quickly deal with people all over the world wherever you want with just the internet.

Decentralization means that one person or entity can't control bitcoin, it takes a community of people and entities to run and evolve the bitcoin ecosystem. It's important because of all the curroptioin we've seen in centralized control of money systems and governments. A person can be corrupt, a community can fight corruption.

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What?


What do you friends say as they watch their wealth disappear over the last two weeks? Does best not equal the actual performance of the investment?

To make it short and simple decentralization is private custody. It's independence. When you own something that you can move around freely and that nobody can take from you hiding behind some law or authority. Things that you have to get a license to use are centralized. They depend on others to function.

Thanks for all the great answers everyone!

My new coin that is launching soon (old website: www.frink.global (http://www.frink.global)) allows everyone to mine as an equal...  what I'm trying to figure out is how to concisely explain this concept.

Equal mining rights?
Everyone mines equal?
Equal control over the currency/network?

You have any other thoughts for how to describe this concept?  I'd ideally like to avoid the word mining so everyday people get it. The benefits are both control, and everyone basically gets their share of Frink's "profits".



Interesting, what would you have done differently? How do you think it should've been handled?

Very easy: I explain the existence of the Internet. There are principles of work, when a few small items are completely dependent in their work on the large, and there are where a few small items work in conjunction with each other and thus provide themselves with the opportunity to exist. Such an explanation scheme is always very accessible to people who are very far from the blockchain.

i took a little look at your project and see some issues.

a person can create 51~(1 first tier 49 second tier) fake social media profiles and add himself to get f1,000 and then from there, repeat using the other profiles and then move the funds into one address.

basically you end up with 1 person ending up with a circle of himself and accumulating f1000 per alter ego just by making
1 new profile and linking to the 50 older profiles created.

you will not need to inflate your currency. because the referral plan you have will hyper inflate new currency, all by itself.

also you say about inflating the spending..
then giving "interest" to the savers..

basic economics is that the"interest" (making new currency to give to savers) is inflation aswell. thus you are inflating the currency in 3 ways
1. coin creation via referrals
2. coin creation in spending
3. coin creation in savings

inflation is BAD. people dont want it where f1000 would buy a loaf of bread today. but tomorrow it requires 1020 to buy some bread

lastly. about inflations. you say that exchanges will store funds in 'spending'.. nope. its like 'hotwallets' exchanges only keep 1-5% of customers funds in 'spending' and then have 95-99% in cold wallets. which in your project would be a savings address

..
as for decentralisation.
well if all the referrals are the same person of a circle. thats not decentralisation.
sometimes you have to realise that code cannot solve social issues.
yea cryptography can reduce hackers ability to get your passwords. but a hammer to someones knuckles or knee joints
until the scream out the password cannot be protected by cryptography.

as for mining
you mention limiting the size of pools. again this is not good.
here is an example. (il drop the numbers down for easy demo)
if a pool can only have 5 identities. then one person will just make 10 pools
or 5 people (that are real who are in the same family). will have 1 people ID per pool each and run 50 pools using each of their alterego's per pool
thus all controlling all the mining in one family

as for the payout for 'mining' 35 years to double that circulation.. meaning 35 years to double each persons F1000 holdings.
an average persons 'savings' is about a weks grocerys to a couple months salary. they wont want to run a program for 35 years where the pay out calculates to double their currency in 35 years. and yet have the value of that currency dwindle down via the savings and referral inflations much sooner

(i stopped reading your project at this point as the flaws were outwaying good economic logic)

summary.
i dont think you really thought out the economics of your project right. everything seems upside down and offering the opposite to what cryptocurrencies are all about.

it seems you more than likely come from the MLM community.

i can see many solutions to many other issues i didnt mention and also solutions to ones have mentioned. but your project does not show sustainability in its current form

When explaining decentralization of cryptocurrency to someone who is new or totally has no idea what cryptocurrencies are, it has to be as simple as possible. I will say that cryptocurrencies are decentralized because it's not regulated by any government, banks or any other entity which means that you as an investor is the one who controls it. That simple and easy to understand. Quite enticing too, right?

Well its quite complicated because the word itself is easy to define as it is just the opposite of centralization but when it comes to crypto, I easily tell them, its not controlled by anyone but you. Not government, not bank not territories and not time. It is solely yours or theirs and they manage it however they want in their own time, own place and own way.

According to me,  decentralization basically means the delegation of authority and power unlike centralization where the power lies with a single body.   

But the "man" himself said,


I believe the essence of "rejecting" other implementations is not political, but more technical, to the convenience of the people who like to spread misinformation.

I will always tell my friends that there is a decentralized currency 'Bitcoin'. It is not regulated by any centralized body or government. One has a full right over her assets.

Decentralisation is simply and concisely defined as being without any form of regulations from any external or internal bodies, institution or government

Decentralization is one of the words that is used in the crypto. Bitcoin is a decentralized currency which is not controlled by any central body but by individuals.

for me, introducing crypto to ordinary people is not something important. even if they ask me about crypto, I will only answer what needs to be answered. so no need to explain in detail. yes maybe a little advice about the risks that have to make them careful is important

Hey Franky1,

I appreciate the feedback, that being said, you're wrong or misunderstanding a lot of this. I don't want to side track this thread though.

Will PM you to discuss this with you. Give me about a day having a, busy day.

For everyone else:
-The social network is used to protect from Sybil attack. We have proven that you can use this to defend against them.
- We are not inflating the currency by creating more becaus we are simply expanding the money supply to grow appointed the number of users for price stability.
- Yes interest causes inflation of the currency, that's the point. But because you are being paid your own interest for money in your own account, it cancels itself out. A unit of currency loses some value due to inflation, but the individual users do not lose the value of their money.

Matt

explaining decentralized to others people is something very important, because this is part of a positive contribution to the crypto world, so, when many people know decentralized systems, the trade volume will increase better.

there are some things that must be considered to explain this system to others.
1. make simple concepts and material about decentralized systems
2. make a simple analogy
3. explain the differences centralized and decentralized in detail.

You decide what will happen to your funds. You can use them at any time, transfer them from anywhere. The parties are only you and the recipient of the crypto. There are no middlemen.

Prices for crypto are formed due to demand for it. There is no single authority that could regulate crypto. It is subject to sharp jumps and changes in value. This is decentralization.

plain and simple, decentralization means no middlemen/third party involve in all transaction...just you and the party involve.

Franky1, can we have your opinion on Satoshi's thoughts on having another implementation of Bitcoin? I believe he made it very clear that it would be very bad for the network.

Maybe the debate is more technical than political, than what the anti-Core group believes it should be?

I would agree that is the purpose of decentralization. To create a currency that cannot be tracked or controlled by anyone other than the sender and receiver.

The purpose of decentralization is to not trust or grant any one person with enough power to cheat the system or infringe on anyone's rights.


I like that except that you could argue when it comes to cryptocurrency, there is always a middleman involved the transaction. It's just not a single middleman. That certainly is the goal though.

but thats the beauty of consensus. to reject rule changes unless majority agree
its the whole point

its why satoshi solved the byzantine generals issue.

by having consensus rules there can be alternative brands on the network. they all follow current rulesets.
. as for upgrades the network has to choose what they (whole community) jointly go for.

but if there is only one general making orders and holding and writing the rulebook(one brand) then there is no choice. its just follow the new rules this single general has written or end up being left out.

also read the entire context. not just someones 'cut' of a quote
read this
read it. and then without bias. read it as if satoshi was the minority. so you can see both sides of his argument.
HE cant simply upgrade if he is the minority.(EG imagine he wanted to remove code to cause a fee war or promote a non-blockchain network)(EG imagine he became corrupt/malicious)

notice how HE is talking about how its a hassle for HIM (sole controller/general/central point) cant just upgrade if there are alternative versions.
again thats the beauty of consensus. no one should have central control


the november 2016-spring 2017 was a good show of it in action. (65%no : 35%yes to segwit1x)
events in timeline order
late 2015: core proposed segwit1mb. community wanted more than 1mb. some wanted 16mb, 8mb, 4mb....
a consensus agreement came in a variant of segwit2x. ill call it segwit2mb to seperate the agreement from the later variant called segwit2x

the segwit2mb would have got high majority acceptance. and was the consensus/compromised agreement of late 2015

early 2016: luke JR backed out of segwit2mb by saying his initial agreement of segwit2mb was a empty non contractual agreement and he no longer wants to abide by it because he is not in power enough to code anything to enforce core can put it into code.
(yet a year later lukejr releases mandated code(UASF) as well as other 3 card tricks.. to force in segwit1x(hypocrite))

november 2016: core released a consensus vote of segwit1x with hopes of activation by christmas.....
spring 2017: still no majority. core was sat at 35% and struggling to move

core got a no vote for segwit1mb because core backed out of an early varient of segwit2x which was the communitys agreement of compromise from 65% wanting more baseblock (some originally wanted 16mb, 8mb, then 4) and the 35% wanting a 1mb baseblock and segwit..

if there was 1 brand. core would have got segwit1mb activated in christmas 2016
but would have had 65% unhappy community left stalled out and a "menace to the network".

but instead of core going going back to a segwit2mb agreement. core doubled down on only wanting segwit1mb

(luke and his colleagues released the other kardashian drama of a possibility of segwit2x but only if segwit1mb is activated first(NYA agreement (DCG.CO)).. this is the reference to luke being a hypocrit above where the USAF+NYA MANDATED segwit1mb and threw off the 65% out of the vote because of "backward compatible" nodes dont need to opt-in to segwit1mb.. and any opposers not "compatible" are banned/rejected)

summer 2017: core got what they wanted. yet the community is still divided

bitcoin is not meant to be one general making and updating the rules. its meant to be the army of generals(community) upholding the law and the community to decide on new laws
a reference client should not be a rule MAKER. but a holder of current rules so that people can refer and know the rules

the idea of bitcoin was that everyone was a general. rules stay the same unless the majority agree on a new proposal. yes it makes it harder for one general to change the rules... but thats the point of it. there should not be a single general.

satoshi later realised that he had become the single general and everyone was going to him. which is why he left.
yet 5 years later it went full circle where core is now the single general(central point)

it should never be made EASY for one general to change the rules. mandating changes and splitting the community.
having multiple brands should prevent there being a single general so that the community have power not a single general

if core want to be a reference client then thats being a reference point of only CURRENT RULES
separately if they want to PROPOSE new rules. ok. propose them as a separate version to a REFERENCE CLIENT.. but dont then use mandated stuff to enforce their proposal with threats of banning nodes and rejecting blocks.

instead of single brand. instead of mandated rule...
let the community consensus around it. and if a majority is not found, compromise..

the 65% against core compromised down to segwit2mb in 2015. yet core have not shown signs of listening to the community to compromise their roadmap. thy instead evicted opposers(usaf) and sheep herded the compromisers(NYA segwit2x).. and once segwit1x got activated. killed of the 2x to just stay with the 1x

Decentralization is the lack of unified management.
Decentralization is one of the basic principles of cryptocurrency and is very important for it. Cryptocurrency was created as an alternative system to the now existing conventional centralized payment systems.

Just need to explain the meaning of decentralization and then we can say the crypto currencies are working in decentralized manner.If you want to explain what is decentralization then it is not controlled by any single or group of people,it is controlled by the random people all over the world and we say it as trustless community.

I explained that it was very simple, decentralized, was independent, there was no institution or government that controlled it. and hope to have a very strong background

The lack of control and the lack of taxation, I think these two factors will be enough to lure anyone, the main thing is not to be frightened by volatility and bears).

Similar analogy of cryptocurrency is the internet.

While the internet backbone in itself if decentralized, the websites that we visit are centralized.
Relating that to bitcoin and other cryptocurrencies, you own your crypto if you own the private key and you can access it anywhere, AS LONG AS there are miners running the blockchain (sort of centralized and decentralized) at the moment.

My explanation is very brief, namely a very strong encryption mechanism. Practical system hack is not possible, so if someone can do it - our world is in great danger and with Rise of the Machines not far away.

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Decentralization is the innovated way for making transactions faster and most of all secured. By this way transactions cannot be possibly tampered and there is no other human that can manipulate the transactions.

But is it technically achievable? Yes that quote might be the cut version but the point is still very valid in my opinion.



Without bias, I still get the same point. I also now get why some Core developers believe that only one version is better for the protocol.



Let me cut you there.

Do you actually believe that the "65% no" signalling by the miners represented what the community wanted? Hahaha.

Plus miner signalling is nothing but a "tool" for them to signal their readiness for an upgrade, not a "tool" to use as means to play politics within the community.

The problem with Proof of Work coins is that it doesn't really matter what the community wants.. it what the miners want.

I thought signalling meant that miners had upgraded their software so that if over 50% of the hashing power of the network over some period of time similarly upgraded, that the entire network would switch.. no?

Did the UASF teach you nothing?

Are you really a newbie? Then you have to read the account of the events that lead to the UASF, https://bitcoinmagazine.com/articles/long-road-segwit-how-bitcoins-biggest-protocol-upgrade-became-reality/


The Core developers required 95% of miners signalling their readiness for Segwit activation.

decentralization is better than centraliz, because it is stronger, and everyone involved is like having the responsibility to look after it

The decentralized nature of crypto, or blockchain in general, means that it doesn’t rely on a central point of control. And it is the lack of single authority that makes the system fairer and considerably more secure. Also, these decentralized networks provide economic incentives to maintainers, developers, maintainers, and other participants in the form of cryptocurrencies, either coins/tokens. And so the better the platform, the more its tokens are valued. The network participants have an economic interest to work together toward a common goal — the growth of the network and the appreciation of the token.

I try to keep secret about my knowledge, but those whom I invite, I make them read the digital gold by the author Nataniel Popper, and I advise them not to invest money without understanding the crypto topic.

No, not a newbie, I've been in crypto for 5 years and know blockchains well.  Just don't follow Bitcoin politics closely. That being said, very interesting article. Thanks Wind_Fury!