A bit of a confession – this post took a while to write. Decentralisation is an ambiguous concept, it can mean different things to different people.
For some context, it is helpful to talk about centralisation first, specifically centralised systems. Most of the systems we have today are centralised. They have a so-called central authority, someone or something that can, on its own, determine an outcome. Quite often, very few people have visibility into what really drives decision-making in centralised systems.
One example is the App Store. Apple approves apps that appear on its App Store, charges fees, can change rules at any moment and also censor apps (like the recent Epic Games saga). Parts of the internet are centralised as well, i.e. Google controls the search results that you see. These systems are not necessarily bad.
But what about the financial system? Does it makes sense that roughly 22% of the US population is either unbanked or underbanked? Or that it’s much harder for minorities to get access to loans? And why is there no accountability?
How about our education or healthcare? The inequalities present in these systems are well known, and yet again, there’s no accountability. Or, perhaps, let’s talk about the internet access. Even in the US, between 20 and 40 million people have no access to the internet. This has consequences, especially in the current economy.
So, you see now, that this is not just about the App Store. The world runs on a centralised operating system, Windows of a sort. There are rules for us to follow, which are laws and societal norms. But the rules are not the same for everyone. Everything about you changes your reality but doesn’t necessarily impact anyone else. For some, rules are so easy that they can’t lose. For others, rules are so hard that they can’t win. Worst of all, these rules are self-reinforcing, so most centralised systems are just infinite feedback loops. Because if you have the power to create rules, why would you make one that strips that power away from you? This is the world of inequality we live in.
Enter decentralised systems. The movement started in earnest with Bitcoin as decentralised money. Ethereum took one of the primary innovations of Bitcoin, namely the blockchain, and expanded it beyond money, to trustless applications.
Alright, some of you are probably lost by now. What is the connection between these cryptocurrencies and fixing the inequalities of our society?
Here’s the answer – cryptocurrency projects figured out how to establish trust on the internet, in a decentralised way, through cryptography and mathematical problem-solving. There are, for the most part, no central actors. No single party that controls all the information and can restrict its flow or access. These are open source systems which means that the rules are clear and evident to everyone. Rules are also the same for all network participants unless coded otherwise. And, crucially, decentralised systems have decentralised governance, i.e. they are governed by the community.
- Brave browser – as you can tell, it’s an internet browser. It blocks cookies, tracking and whole bunch of other stuff Google throws at you. Now it’s a crypto project, so obviously it has a token associated with it. The token is called BAT or Basic Attention Token. So what is the point of BAT? See, when you use Google, it tracks everything you do and then sells that information to advertisers. In the Brave browser, you, the user, can opt-out of seeing ads altogether. But lets’s say you agree to see some ads. Then you are compensated for your attention with BAT. Meaning that you get paid for every ad that you view. This creates a more fair and distributed advertising model for the internet.
- Gooddollar – this project is relatively new and utilises the growing decentralised finance (DeFi) ecosystem. Let’s simplify the concept here. Gooddollar is a Universal Basic Income scheme. Pretty simple, you sign up and can claim daily income. How does the project generate money for distributions? Easy. In traditional finance terms, people who believe in UBI put some of their capital into an interest-bearing account. Half of their interest is being collected and distributed as UBI, while the other half goes back to them. Obviously, they still own the principal. All of this is done in a decentralised manner.
- Helium – Helium is trying to decentralise wi-fi and, therefore, access to the internet. We can all agree that having access to the internet is crucial in today’s economy. For now, Helium doesn’t target wi-fi. Instead, it distributes a wireless connection that can be used by IoT devices, think Lime bikes, pet collars, etc. Basically, you install some hardware (Helium hotspot) in your apartment/house and start broadcasting. You are then paid, in Helium token, for providing this service.
So what is the point of all this?
Alright. It is my opinion that the best way to fix our inequalities is through decentralised governance and redistribution of power. We have tried to do it with existing tools to no avail. Which makes sense given the design of the Windows the world is running on. Instead, we can design a decentralised operating system that is a better fit for the world we live in.