Why decentralization is so important for crypto?

[Slava79]

Seriously, what's all this decentralization thing about?

I can see 2 reasons:

1. Central server can become dishonest.
2. Central server can be taken down by gov.

But, isn't 1.  applies to some cryptocurrencies also (the ones from top 20 in coinmarketcap, I will not call the names here).

So, if 2. is addressed in some way, 1. is not that important for a cryptocurrency to be successful, right?

Then, isn't having "blockchain" and "whitepaper" is more a cargo cult in many situations? There really could be a central server with some gamification for users (mining, rewards, marketplace etc) and if it is build in a way it can't be blocked (not to discuss here how), it can be called a currency and it's perfectly fine?

Or am I all the way wrong? )

[cryptotnak]

Because thats the main aim of bitcoin,to have decentralized currency for all the people for example taxes would be eliminated by the hodlers it give us freedom to use our mone without paying the government,

[Slava79]

Because thats the main aim of bitcoin,to have decentralized currency for all the people for example taxes would be eliminated by the hodlers it give us freedom to use our mone without paying the government,

Agree, but the real goal is to "freedom to use our money without paying the government", not decentralization itself, correct? Decentralization is just a way this is achieved.

So if someone invents a way to run a centralized server (or group of servers) which can't be affected by government, it'll still count as a cryptocurrency, no problem?

[eternalgloom]

Yes, decentralization is important for Bitcoin because the reasons you've listed.

Bitcoin could be easily taken down by governments if it wasn't decentralized, it's comparable to the torrent protocol in that way.

This doesn't mean that there isn't centralization within the Bitcoin ecosystem, most people choose to exchange Bitcoin for fiat and altcoins through centralized exchanges.
But as a user you're not forced to make use of any centralized infrastructure, you can easily just use the blockchain for p2p transactions.

Here's a pretty good article from Erik Voorhees about the matter:
https://bitcoinmagazine.com/articles/bitcoin-truly-decentralized-yes-important-1421967133/

[IlfarIldarovich]

The very importance of cryptocurrency is decentralization . Also and exchanges must be decentralizaton and not as now , Wanted abolished ,introduced new rules . With centralized exchanges many problems

[~Bitcoin~]

Decentralization is one of the main feature cryptcurrency should have to become successful, if bitcoin is centralized than it will never get as much success as it have right now.

Government will easily crack down such centralized network and we all know they don't like to deal with crypto. Decentralization add security + stability in crypto.

[Slava79]

Thank you all for your answers (eternalgloom: I'm reading the article)

But, nevertheless, I don't have clear understanding (maybe it's me).

Being a developer, I'm trying to think in terms of technical requirements and how could I accomplish them.

Requirement: As a user, I want to trade my currency freely, not having any government interruptions, not having to pay taxes etc.

Implementation:

Proposal 1: lets implement decentralized p2p network with proof of work => Bitcoin

Proposal 2: lets wire up a bunch of anonymous Tor services (for example) and serve user requests there.

Wouldn't p.2 work as good as p.1?

[jekjekman]

A decentralized digital money is the best money that has ever been created IMO.

Money is money and there is a saying that 'Money is the root of all evil' so having a group people controlling on a specific cryptocurrency maybe safe for the mean time but if the value grows just like what happened already to Bitcoin then there is a tendency that one person to that group would think of an evil deed just like what a typical politician that steals funds from the government projects.

[serian]

Decentralization one of the main thing in crypto. As you already mentioned centralized system can be easily shutdown or controlled. Crypto also can be censorship resistant and anonymous such like Monero/PIVX.

[JanpriX]

Without the feature of being decentralized, people will not use cryptocurrency in the first place. People will shy away from it and would not even bother to bat an eye for it if the so-called cryptocurrency don't have any decentralized feature. It is being accepted by the masses now because of the fact that the government doesn't have any control for it. They can't manipulate it for their own greed and people will be able to avoid the tax payment that are just used for corruption.

People want to have the free will on how to use their cryptocurrency without the interference of peeps from the government bodies.

[CONTRACT]

Bitcoin was not the first crypto currency, search the Internet for a story about Liberty e-currency, and get why now the topic of decentralization is so important

[Tidsdilatation]

Decentrilazation is very important becourse:
1. The world is becomming one big country. In 100 years there wont be countries. There will be earth. And Mars. We need one currency that cannot be controlled by a dominant party.
2. Ppl start loosing trust in the big partys of the world today. One more crash and the whole system is unrepairable again.

I think these are the two most important points.

[Vatimins]

Thank you all for your answers (eternalgloom: I'm reading the article)

But, nevertheless, I don't have clear understanding (maybe it's me).

Being a developer, I'm trying to think in terms of technical requirements and how could I accomplish them.

Requirement: As a user, I want to trade my currency freely, not having any government interruptions, not having to pay taxes etc.

Implementation:

Proposal 1: lets implement decentralized p2p network with proof of work => Bitcoin

Proposal 2: lets wire up a bunch of anonymous Tor services (for example) and serve user requests there.

Wouldn't p.2 work as good as p.1?

     The question you gave really poked my curiosity. Haven't really thought about that yet until now that i have read your post. It surely is difficult to grasp block-chain and the real purpose or should i say the epitome of all the great things about crypto currencies(having profits as an exception) which is the decentralization of these tokens or coins. But what I'm sure of is that both ppints you have mentioned are very very important to most of us here.

Now, on this quoted post from you, i am pretty interested. This might reqlly work. I ain't a techy person but i think i get the idea. This would be a pretty nice start for a plan to make another token or coin that is different. Something that is with a purpose of being something useful and solves problems compared to other tokens or coins driven by profit alone or greed.

[KuromaYoichi]

Seriously, what's all this decentralization thing about?

I can see 2 reasons:

1. Central server can become dishonest.
2. Central server can be taken down by gov.

But, isn't 1.  applies to some cryptocurrencies also (the ones from top 20 in coinmarketcap, I will not call the names here).

So, if 2. is addressed in some way, 1. is not that important for a cryptocurrency to be successful, right?

Then, isn't having "blockchain" and "whitepaper" is more a cargo cult in many situations? There really could be a central server with some gamification for users (mining, rewards, marketplace etc) and if it is build in a way it can't be blocked (not to discuss here how), it can be called a currency and it's perfectly fine?

Or am I all the way wrong? )

The biggest reason is one, centralization can become dishonest in the longrun and they can make whatever decision that they want and they can manipulate a lot of things because they have the authority, that's why some exchange can block account etc. With decentralization everything can be fair and give benefit to all parties.

[CoPil]

Seriously, what's all this decentralization thing about?

I can see 2 reasons:

1. Central server can become dishonest.
2. Central server can be taken down by gov.

But, isn't 1.  applies to some cryptocurrencies also (the ones from top 20 in coinmarketcap, I will not call the names here).

So, if 2. is addressed in some way, 1. is not that important for a cryptocurrency to be successful, right?

Then, isn't having "blockchain" and "whitepaper" is more a cargo cult in many situations? There really could be a central server with some gamification for users (mining, rewards, marketplace etc) and if it is build in a way it can't be blocked (not to discuss here how), it can be called a currency and it's perfectly fine?

Or am I all the way wrong? )

I agree. Decentralization gives the currency a freedom. Freedom from taxes, freedom from the authorities. It very important because "autonomy" is the best asset as to why digital currencies especially Bitcoin gained popularity and merit to people.
If it will be 'totally' centralized, what is its difference to our typical centralized currencies?

[drunkcoin]

The author answered why it's important. Yes, it's made in case the server will be down or corrupted by someone. Decentalization guarantees that all the data will be secured.

[marks1976]

Seriously, what's all this decentralization thing about?

I can see 2 reasons:

1. Central server can become dishonest.
2. Central server can be taken down by gov.

But, isn't 1.  applies to some cryptocurrencies also (the ones from top 20 in coinmarketcap, I will not call the names here).

So, if 2. is addressed in some way, 1. is not that important for a cryptocurrency to be successful, right?

Then, isn't having "blockchain" and "whitepaper" is more a cargo cult in many situations? There really could be a central server with some gamification for users (mining, rewards, marketplace etc) and if it is build in a way it can't be blocked (not to discuss here how), it can be called a currency and it's perfectly fine?

Or am I all the way wrong? )

It looks the first reason alreayd applied into the cryptocurrency that already applied non based blockchain application. And it has used the server just like a miners.
But for the second reason and it's quite understanable just like how the centralized exchange can be blocked or even banned by the government. This is why the decentralization is everything.

[Nana_Marini]

Seriously, what's all this decentralization thing about?

I can see 2 reasons:

1. Central server can become dishonest.
2. Central server can be taken down by gov.

But, isn't 1.  applies to some cryptocurrencies also (the ones from top 20 in coinmarketcap, I will not call the names here).

So, if 2. is addressed in some way, 1. is not that important for a cryptocurrency to be successful, right?

Then, isn't having "blockchain" and "whitepaper" is more a cargo cult in many situations? There really could be a central server with some gamification for users (mining, rewards, marketplace etc) and if it is build in a way it can't be blocked (not to discuss here how), it can be called a currency and it's perfectly fine?

Or am I all the way wrong? )

All rigt guys. I think decentralitation is important for development of bounty. Decentralitation system make transaction is an easy choice

[ozaeri]

it will owe by people, we rule, we buy, we sell, we are together, doesn't matter where are you from, the future is here now

[romero121]

If this had functioned under a centralized system, now Satoshi or the key person could have earned bigger than Bill Gates and other billionaires. Being a decentralized system, it gives access to common people and it serves as freedom to the people who use it in one or the other way.