Beginners Guide to Blockchain XI: What is Decentralization

Chris Pace
3 min readApr 22, 2022


Image: Shutterstock / Article by Chris Pace

In this article of Beginners Guide to Blockchain, we will be covering the question “what is decentralization?”.

However, before we start I do recommend you go read my other articles that will give you more context to better understand this topic.

You can click on them, and give them a quick read below:

  1. What is Bitcoin?
  2. What is Blockchain?
  3. What is Ethereum?
  4. What is DeFi?
  5. What is an NFT?
  6. What is a DAO?
  7. What is an Altcoin?
  8. What is an ICO?
  9. What is Web 3.0?
  10. Crypto Dictionary (other terms you need to know).
  11. What are the real risks in crypto?

So now that we are ready, let’s start with the definition of “Decentralization”:

Decentralization is the movement of supervision and decision-making from a centralized entity (person, organization, or group of individuals) to a distributed network in the blockchain.

Why is it important?

Decentralized networks search to lower the level of trust that users must have in one another and to prevent them from imposing power or control over one another in ways that degrade network functionality.

Decentralization is not a new idea, however, because of blockchain and the crypto revolution it has grown in popularity lately.

Let me give you an example that every IT manager out there will understand and that it will help you understand that decentralization has been important for a long time.

Here’s the example:

Let’s say that somebody gets accused by the government of something they didn’t do, the government in 1 second has the power to leave him out of his bank accounts, that is because Banking and finances are centralized. If it was decentralized no one would be as controlled by big data and big companies and big governments. When putting together a technology setup being on an office or home office, there are two main network structures that IT managers use: centralized and decentralized.


Decentralized networks are used a lot in blockchain technology, a blockchain application cannot be classified as decentralized or not.


Business decisions are made at the top of the company or in a head office and then distributed down the chain of command in a centralized system.

For me, the big thing about decentralization is that it will allow us a way to stay safe on the crypto market. This due to not only one person is organizing, it’s more of a “group” thing.

Now I will give you 3Benefits of “decentralization”

Benefit 1: it gives a trustless environment

In a decentralized blockchain network, trusting other people is not needed, every user has the exact same copy of the data in the form of a distributed ledger (a series or chain of blocks), so if anyone tries to change it, it will be dismissed by most of the other members in the network.

Benefit 2: Optimizes resource dispensation

Decentralization can also speed up the process of distributing resources so that services can get better performance and consistency. also reduces the chance of a huge failure.

Benefit 3: Reduces points of weakness

Decentralization can help to avoid weaknesses by not being too reliant on specific members. These weaknesses could become a systemic failure, this includes lack of services or even not being able to provide services due to periodic shutdowns, bottlenecks, lack of sufficient motivation for good service, or corruption.

Closing thoughts

To put it another way, blockchain decentralization is an information base that contains a library of resources and trades through a peer-to-peer network. It’s possible that the “resource” isn’t just cash or transactional data, but also ownership, agreements, products, and other information.

Unlike previous peer-to-peer networks, a blockchain does not replicate the value that is transmitted.

Decentralization is very important in general, to keep the blockchain safer and to avoid running into any trouble.

If you would like to hear more crypto-related stuff, make sure to follow @bychrispace on Twitter and on pretty much all other social media.

Chris pace.



Chris Pace

👉 I’ll help you launch and scale past 7 figs using tech & story. 🔥 Revealing the secrets of LATAM to english speakers. 😱 +$100M in student results.