That's a function of an early industry, and increasingly the trend has been towards decentralization. There are more large exchanges, more small exchanges, and increasingly large parts of the cryptocurrency stack are being further decentralized and open-sourced (a great example is the BTCPay project, which replaced a closed source SAAS API with an open source wrapper around the open source bitcoin client).
Indeed, and there may be strong financial/legal incentives for doing so. Similarly, many developers may all be employed/funded by one organisation, and multiple clients may share large amounts of code (and be unable to avoid accepting large changes made to the upstream project).
So, while I appreciate the great effort to quantify the level of decentralization in the cryptocurrency space, I think the article mostly just exposes the subjective decisions being made by people who make claims about decentralization. Even that could be a big step forward for debating these technologies, though.
Cryptocurrency is so decentralized that most of it is held in a hand full of exchanges (aka, centralized).
It seems the crypto community also does not care about the obvious centralization, but who would've ever thought major contradictions would come out of cryptocurrency?
I think the centralisation issue with most cryptocurrencies is quite interesting. Almost all of them have a generally accepted organization that controls their development. This organization can make large-scale changes but controversial ones usually lead to breakaway forks. Theoretically these forks could be more valuable than the one controlled by the organization. In practice if a fork wants to be successful it's going to need its own organization.
Many coins are not really decentralized , there is some centralization anyways as we recently heard with the Ronin bridge attack or many examples from before.
a major tenet of cryptocurrencies is decentralization and controlling your own ability to transact. using centralized exchanges is antithetical to this maxim because it gives these organizations power over you.
Ultimately I think that's one the big issues with crypto. Even though most altcoins boast decentralization, their development is only controlled by a few people who have commit rights to the git repository. When someone disagrees with them, it usually ends up in forking a new currency. Perhaps someone with more experience in the crypto space can shed some light on this...is there a way to truly decentralize development as well?
That's the thing, you only depend on centralized actors if you want to. The entire point of cryptocurrencies are to not depend on centralized institutions that can screw you over.
I work for a company that provides financial services to/on centralized exchanges, but none of us really like the centralization there; even if it's our bread and butter (for now) I think most "crypto people" are more excited about decentralized exchanges.
The entire point of a cryptocurrency is to be a decentralized electronic currency.
Centralized exchanges exist to handle the problems with decentralized electronic currency.
If there was a good way to decentralize a centralized exchange, that solution would just be part of the decentralized currency and the exchange wouldn't need to exist.
I’m contrasting payments in general there, centralized always requires KYC legally and is pretty well enforced vs decentralized payments it may be required legally but is not enforced via the protocol. No crypto (that I know of) has KYC built into it at a protocol level, some are varying levels of anonymous and low friction.
I do think what you’re implying is correct that you actually do need to go through KYC for some payments/business relationships regardless of whether they’re conducted through the regular banking system, cash, or crypto. I’m not a lawyer though
No, not all cryptocurrencies are decentralized. There's nothing about a blockchain that requires decentralization. It's a key tenet of some of the coins, but not all.
However there are more and more truly decentralization projects. Anything that doesn't do KYC when related to crypto trading/exchanging - have to be
reply