Decentralization
The distribution of power and control across many participants, reducing single points of failure or authority.
Decentralization disperses control among multiple parties so no single entity can unilaterally change the rules or censor transactions. In blockchains, it manifests across three axes: consensus participation, network infrastructure, and development/governance.
A blockchain with many independent full nodes, geographically distributed miners/validators, and multiple client implementations is more decentralized than one controlled by a few parties.
Decentralization can reduce throughput and make coordination slower, but it increases resilience, neutrality, and censorship resistance.
A highly decentralized PoW network might process fewer transactions per second than a centralized system, but it can remain functional even if some regions go offline.
Related Terms
Node
→A device that participates in a blockchain network, with roles varying from transaction validation to block creation.
Proof of Work (PoW)
→A consensus algorithm where computing power is used to solve complex problems, verify transactions, and create new blocks.
Proof of Stake
→A consensus algorithm where one's stake in the cryptocurrency is used to validate transactions and create new blocks, offering an energy-efficient alternative to Proof of Work.
DAO (Decentralized Autonomous Organization)
→A DAO is an on-chain governance structure where rules are encoded in smart contracts and decisions are made collectively by token holders or members.
All terms and definitions may update as the Cryptionary improves.
