Why decentralization is not the end goal of Web3

The transition from Web2 to Web3 is inevitable. However, as the need for decentralization grows, several important questions are being raised about the current state of blockchain technology and its promised “decentralization.”

Vitalik Buterin responded: "A lot of this comes down to limited technical resources and funding. It's easier to build things in a lazy, centralized way, and it takes serious effort to 'get it right'." Or, Jack Dorsey's recent Tweets claiming that it is actually venture capitalists who own the network that exists today.

Their comments make it clear that, given the status quo, popular blockchains appear to be a long way from realizing their decentralized dreams. This raises the question, who will actually own the future of the internet?

Will Web3 deliver on its promise?

Even before Moxie and Jack called for Web3 to be what it was once trying to replace, there had been several incidents that had many questioning the decentralization of the ecosystem. Take several legacy layer-1 chains as examples. While many advertise themselves as decentralized, recent events have made it clear that existing layer 1 protocols are not truly decentralized.

Whether it was Ethereum’s Infura crash in 2020 (the network suffered multiple outages culminating in an “accidental” hard fork due to mysterious behavior by the core development team), Solana’s ongoing outage, or the AWS outage that brought down dYdX. If you look closely, you'll find many instances that raise a key question: are today's blockchains actually decentralized, or is the power these networks provide still in the hands of a few?

Beyond that, Web2 is now at the pinnacle of centralization. From data monitoring, censorship of social media platforms to banning users without valid reason, there is no shortage of problems that need to be solved by Web3. Clearly demonstrating that decentralization is more important than ever in the next generation of the web.

However, the future remains uncertain as ensuring that the next version of the internet is run by its users appears to be a daunting and daunting task. Due to the increasing resource demands of today's chains on individual participation, most chains are either ineligible due to funding constraints, or lack the skills or motivation to succeed due to the complexities of running a full node.

Replacing L1 is at best a short-term solution

While the likes of Solana, Avalanche, and even Polygon were originally introduced as solutions to the high fees of other blockchains, the trade-offs they made came at a price. Cheap fees, while great for users, gain money by sacrificing decentralization. The Solana network has seen its bot activity simply because it is cheap to do so.

However, fees won't stay low forever. In fact, the fees of networks like Polygon and Avalanche started to increase as demand for them increased. Provide a network where users can transact at a lower cost and they will come. More demand requires more transactions to be accommodated in the same block space as before. Eventually, users start competing for block space, causing fees to increase.

Simply creating new layer-1s, sacrificing decentralization without fixed fees, is certainly not the answer in the long run.

radical rethink

Scott Galloway also recently started to criticize the Web3 trend. And, he's right about some things, notably the lack of diversity in the industry. However, like everyone else, he failed to come up with real ideas on how to change things. Instead of considering whether one day everyone could run a server, he went beyond Moxie's conclusion that "people will never run their own servers." Then, it was also said: if you have to pay for something, why would anyone use Web3?

There is no such thing as a free lunch.

We are used to not paying in cash. The price we pay now is much higher. We pay for our privacy, we pay for the limited information we have access to, and the types of information certain agencies want us to see. The price we pay is not free.

I believe that for Web3 to succeed we first need to rethink the costs we are currently bearing and the value of the control we actually have.

We also had to rethink what we thought of as servers. Do people really never run their own servers? I strongly disagree. Why do we limit ourselves to thinking that servers as we know them today won't change? What makes us think that one day our phones won't be as powerful as servers?

Let's reconsider our assumptions and what we think is worth paying.

Decentralization is a means

Although in the blockchain industry, the ultimate goal seems to be decentralization. However, I see decentralization as a means to an end. Only when the web is truly decentralized can it be censorship resistant.

And, when the network is censorship-resistant, information can flow freely and people can connect and transfer value without borders. That's why it's such a powerful force. It allows us to regain the freedom we currently pay for using Web2.

In order for Web3 to be given control and provide access without locking anyone out, it needs to be decentralized. So decentralized that there is no central point of control. Only then can Web3 help realize human potential and empower freedom.

I believe that if we fundamentally rethink our assumptions, if we challenge what a server looks like, and foster an environment where we collaborate to make true decentralization happen, Web3 will give us a better version of the Web as we know it .