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Offline starspirit

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The Balance of Centralisation (An opinion)
« on: February 23, 2015, 10:49:20 PM »

The crypto-community generally espouses maximum decentralisation, and is often seen as the reaction against the growing centralisation of wealth and power in modern society. However there is a case to make for a less extreme view - that the degree of centralisation versus decentralisation needs to find a balance, and we also need to be clear about what exactly we are decentralising, and what we are centralising.

For example, take decentralised decision-making. Its clearly difficult, sometimes impossible, for coordinated decisions to be made by a large decentralised group, and to be made on a timely and effective basis. Yet often, situations call for such sharp decision-making. Especially when it comes to opportunistic or strategic situations.

Further, members of large groups do not universally have the skill or time to reflect on every group decision that might be required. Most will be inclined to delegate the decision-making on specific issues to trusted and philosophically aligned parties. This makes a more efficient system by allowing all members of the network to specialise and focus their energy on the things that are most rewarding to them.

The key property that needs to be decentralised among a stakeholder base is power. As long as stakeholders hold the keys that empower or disempower their delegated decision-makers, and these can be enacted effectively and promptly without those decision-makers usurping the process, then decision-blocs and decision-heirarchies might actually prove to be very efficient structures in society, that, rather than serving the decision-makers, serve only the stakeholders. With this stakeholder power, the decentralised network ought to be able to deconstruct and reconstruct whatever structures they desire according to their mutual effectiveness. The current delegate system with slate-votes is but an early example of this.

The power of a system to grow and dominate its competitors lies in this organic balance - decentralisation with centralisation, self-organisation with global action. Developing the organisational and stakeholder control tools that would facilitate this would make a more powerful, adaptive and enduring system.

Offline monsterer

Re: The Balance of Centralisation (An opinion)
« Reply #1 on: February 24, 2015, 10:06:10 AM »
I completely agree. In many situations where something becomes very one sided with no alternatives, like the time before bitcoin where banking was the only accessible store of value, the reaction when something new comes along (like bitcoin) which fits the bill is to accept it as the complete alternative. Over time, disadvantages become apparent and some kind of middle ground is sought out, taking the advantages of both.

You see this kind of behaviour everywhere in society, even the markets behave like this - after a sudden strong rally, you'll get a crash, but eventually the price will be somewhere between the two extremes. Often bang slap in the middle.

edit: with that in mind, here are your two main contenders for the post bitcoin landscape:

* Ripple
* Bitshares

Both offer varying degrees of centralisation, with both offerings being on the extreme opposite ends of the middle ground. Interesting stuff!
« Last Edit: February 24, 2015, 10:10:11 AM by monsterer »
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Offline CLains

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Re: The Balance of Centralisation (An opinion)
« Reply #2 on: February 24, 2015, 10:51:31 AM »
Tragedy of the commons is the problem where each fisherman pulls in as much fish as possible, but they all die of hunger when the fish run out. This seems to be a problem of decentralization. If all the fishermen instead acted in unison they would be super-rational.

This problem is to some extent solved by voting. But how do we reconcile the will of BitShares shareholders at one point in time with the will of shareholders at another point in time? Unlike being an individual, I can easily exit from the consequences of my vote in BitShares at any time.

Imagine being a ghost that could occupy any body at whatever time. You could be reckless in consuming sweets and junk-food; the pleasure would be immediate and the consequences irrelevant as you could simply find another body to exhaust.

Offline Ben Mason

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Re: The Balance of Centralisation (An opinion)
« Reply #3 on: February 24, 2015, 12:08:40 PM »
What is it about centralization that must be avoided at all costs?  The primary threat is that bad actors are a certainty and they will exploit any weakness in a system to accumulate influence over time and subvert the purpose of the system, like cancer. 

If a degree of centralization can be achieved without providing the means for bad actors to accomplish more than a transitory effect then great.  If not, the compromise is absolutely not worth it.

From what I understand of Ripple, it is the antithesis of efforts to decentralize power.
« Last Edit: February 24, 2015, 01:36:14 PM by Ben Mason »

Offline starspirit

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Re: The Balance of Centralisation (An opinion)
« Reply #4 on: February 24, 2015, 11:14:24 PM »
What is it about centralization that must be avoided at all costs?  The primary threat is that bad actors are a certainty and they will exploit any weakness in a system to accumulate influence over time and subvert the purpose of the system, like cancer. 

If a degree of centralization can be achieved without providing the means for bad actors to accomplish more than a transitory effect then great.  If not, the compromise is absolutely not worth it.

From what I understand of Ripple, it is the antithesis of efforts to decentralize power.
Ben, its unfortunate that bad actors are a given, and some of these will desire to find any means to cement their power once they have a taste of it. History is inarguable here. Its valuable to find ways in which decentralised networks can make effective group decisions without the need for high levels of organisational structure, to reduce the bad actor risk.

Despite this, I feel there need to be effective mechanisms to cast out such actors once identified, rather than avoiding their possibility by discouraging organisational structures altogether. The desire for group endeavour around common goals is too strong, and its results too powerful, for organisational structures of some form to be resisted by any society for long. I believe it's not even a conscious choice we will make in the end - its just a natural tendency that all networks (including brains) will evolve to make use of structure for better results, and ultimately survival. In my mind, the alternative is every person participating in every decision ever made that may affect them in some way, which would overwhelm society and mire it in a low order of productive capacity. I suspect this is ineffective idealism. The model of a decentralised network that allows more powerful organisational structures, while promoting maximum security to stakeholders, will simply gain competitive dominance in my view. That's why I think its useful to consider what the system will look like in the future, and to build the right tools toward it.

Offline Ben Mason

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Re: The Balance of Centralisation (An opinion)
« Reply #5 on: February 25, 2015, 10:58:43 AM »
What is it about centralization that must be avoided at all costs?  The primary threat is that bad actors are a certainty and they will exploit any weakness in a system to accumulate influence over time and subvert the purpose of the system, like cancer. 

If a degree of centralization can be achieved without providing the means for bad actors to accomplish more than a transitory effect then great.  If not, the compromise is absolutely not worth it.

From what I understand of Ripple, it is the antithesis of efforts to decentralize power.
Ben, its unfortunate that bad actors are a given, and some of these will desire to find any means to cement their power once they have a taste of it. History is inarguable here. Its valuable to find ways in which decentralised networks can make effective group decisions without the need for high levels of organisational structure, to reduce the bad actor risk.

Despite this, I feel there need to be effective mechanisms to cast out such actors once identified, rather than avoiding their possibility by discouraging organisational structures altogether. The desire for group endeavour around common goals is too strong, and its results too powerful, for organisational structures of some form to be resisted by any society for long. I believe it's not even a conscious choice we will make in the end - its just a natural tendency that all networks (including brains) will evolve to make use of structure for better results, and ultimately survival. In my mind, the alternative is every person participating in every decision ever made that may affect them in some way, which would overwhelm society and mire it in a low order of productive capacity. I suspect this is ineffective idealism. The model of a decentralised network that allows more powerful organisational structures, while promoting maximum security to stakeholders, will simply gain competitive dominance in my view. That's why I think its useful to consider what the system will look like in the future, and to build the right tools toward it.

I agree with what you are saying starspirit.  Once DPOS scales and each delegate role has thousands of individuals working for it, we will need additional layers of organisation.  It's possible that stakeholders may defer their voting rights over delegates to trusted parties which would be a move towards centralization.  That would be fine as long as the second that any party (in any layer) acted against the system, they are identified and action is taken against them.  The loss of trust should be considered by all participants as the most painful cost and thereby incentivized against actions that would cause it's loss.  We need an effective immune system so the most important thing is that we are constantly exposed to trusted information in the context of our expectations derived from the open source rules of the system.

 

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