Are Decentralized Systems The Future?

How secure do we think our data on the internet is? Well, someone does has an answer for this:-

“I don’t want to live in a world where everything that I say, everything I do, everyone I talk to, every expression of creativity or love or friendship is recorded .” — Edward Sowden

In 2013, Edward Snowden leaked highly classified documents about global surveillance programs allegedly run by the NSA and the US government.

So, how do you think this affects the lives of common people such as you and me?

Well, some may find it ‘normal’ as they say that they have nothing to hide whereas others may find it as a direct breach to their privacy. After the ‘Snowden’ event there were many rallies organized all across the world in support of him. This was followed by the ‘Snowden Effect’ as the general public began to question their privacy. They started wondering whether they are watched 24x7. This sparked an overdue debate about national security and individual privacy.

Let’s analyze a situation of how the general public is vulnerable to the above situation.

Suppose you shop online or go on a vacation, data security is the last problem you might think of. You easily book your tickets or shop things online on centralized systems such as Amazon or GoIbibo by providing your payment credentials and other personal details. You fully rely on them with the security of your data thinking that your data should be secure with these big firms.

However, the size of the service is not an index to guarantee your data security. The bigger is the service, the more attractive it is for hackers.

The hack of Equifax, one of the biggest credit score bureaus, led to 143 million identities stolen in 2017. Likewise, you may have heard about various social media website hacks wherein the hackers leaked profiles of millions of users in Darknet.

“If you put a key under the mat for the cops, a burglar can find it, too. Criminals are using every technology tool at their disposal to hack into people’s accounts. If they know there’s a key hidden somewhere, they won’t stop until they find it.”

— Tim Cook, CEO Apple Inc.

In modern times, you may not realize it but the world is becoming more and more private. This century has witnessed the rise of privacy tools more than ever such as cryptocurrencies, blockchain.

In technical terms, blockchain is a growing list of records, called blocks, that are linked using cryptography. Blockchain represents a database that contains records about transactions. Each block contains a Cryptographic Hash of the previous block, a timestamp, and transaction data. It is an open ledger that is visible for everyone on the web. The records about transactions are immutable and can never be altered or deleted.

Thus the biggest advantage of using cryptocurrencies and blockchain is that it is visible to everyone but only the participants of the deal will know who sent how much money to whom.

The above tools lead to the development of Decentralized systems. It is an approach dedicated to the idea of self-organization. Instead of being dependent on a central authority, the system is divided into numerous small authorities which are linked among themselves but are available to everyone.

“Decentralized systems are the quintessential patrons of simplicity. They allow complexity to rise to a level at which it is sustainable and no higher.”

— L K Samuels, American Author

Let’s understand the difference between a centralized and a decentralized system from the view of a hacker.

With a centralized service, all you need to do is break into a single datacenter, and the data is yours. With a decentralized database, you will have to break into every part to obtain only a small fraction of the whole data set which is not worth it. The decentralized approach makes it impenetrable for hackers.

Decentralized markets have also become a trend in recent years. In a decentralized market, technology enables investors to deal directly with each other instead of operating from within a centralized exchange. Virtual markets that use decentralized currency, or cryptocurrencies, are examples of decentralized markets.

Real Estate business is an example of a decentralized market that has been existed for years and does not involve a central party. You can explore various online decentralized markets such as OpenBazaar which is becoming the new silk route of online trade.

Despite its benefits, the road to taking a decentralized approach is a difficult one and you have to make your own choices. With the advent of the decentralized system, it leads to a major question, do we need to rethink the form of our life, our approach towards various things happening in our life? Well, obviously we can’t have decentralization in every aspect of our life but surely can think that in which aspect do we want to apply it. But as I said you have to make your own choices!!

More blogs to follow!!

Shridam Mahajan

Online Head, Technothlon 2020