Is decentralization always a good idea?
When blockchain technology was created, it gave rise to more and more things, coins and companies, becoming decentralized. However, there has been some backlash against this concept. When Bitcoin arrived on the scene, skeptics were saying that it couldn’t be trusted because it was decentralized, no central system behind it. Although Bitcoin has flourished, with being decentralized as one of its main starting selling points, citizens around the world have wanted a decentralized currency, as they were losing trust in the governments and banks managing their money from causing situations like most notably, the great depression. People and companies have been testing to see if blockchain technology could make more things successfully decentralized, which gives rise to the question: is decentralization always a good idea? The most straightforward example to analyze would be a company.
What are the pros and cons of a decentralized company?
Pro
❏ Lower and middle-level managers have more authority to make more impactful deals and have more say in the direction of the company.
❏ By giving more power to the managers, they will be invested in the future of the company and will be motivated to work harder.
❏ With managers playing a more authoritative role this will increase communication with your employees, as the managers will be able to make more impactful decisions to help the work-life of the employees and boost morale.
Cons
❏ By conceding a lot of the day to day decision making to managers you have to trust in all of your managers to make the best calls for the company.
❏ By more people making impactful decisions for the company, their goals might not be your goals.
Thinking about the pros and cons, I do believe decentralization would work for many companies, and it is understandable why people want a decentralized currency. Everyone has invested in his or her countries currency because we pay our bills with it and buy our food with it, so it makes sense that we want a say in the future of our money. However, as it stands now, the future of the currency, of our countries, lies in the hands of the government and the banks. That is why people are investing so heavily in cryptocurrency and want it to succeed. Although there are situations where a centralization system would be preferable we already have so much of that in the world, it's time to explore where more decentralized systems would work.
-Written by James Hepburn