In recent years, a wave of centralization is in the network. In many markets, everything is focused on a large supplier. Amazon dominates online commerce. Facebook is the social network. And AirBnB is the nightly accommodation provider.
Quasi-monopolists dominate in many industries today. And they are constantly expanding their positions, because their size generates the fuel necessary for further growth.
First, size itself offers an advantage, since the service of a central platform generally improves the more market participants it gathers. Customers want to choose from as many suppliers as possible, and suppliers are happy to have a large number of potential customers. Once a platform has the advantage, it can only be difficult to attack by competitors who have to start small.
The second advantage is obtained by monopolists with their data collections. The more data about the users and their behavior, the better the analysis will be. Those who can access the largest data bottle can easily introduce and test new features and products based on usage analysis, thus improving their service.
The large platforms act as intermediaries between the other market participants. Then they alone have an almost complete overview of supply, demand and transactions in a market. It seems to be an unwritten law of the digital era that through this advantage in each industry prevails a centralized provider that, on the one hand, organizes the market, but on the other hand can also determine the rules of the game for all others.
The big central players, however, are a problem. They inhibit innovation by making new suppliers with new market access ideas difficult. In addition, they are central targets for hackers and censorship. And, meanwhile, they are now so dominant in many industries that they can dictate conditions to the other market participants they depend on.
Blockchain can open markets for equity and innovation
The Blockchain has what it takes to finish the wave of centralization. It is the technology behind the Bitcoin digital currency. However, it can not only handle financial transactions without central intermediaries. It has been invented to organize markets of all kinds without a central authority. It allows market participants (suppliers and buyers) to communicate directly with each other in a global network without intermediaries.
In the Blockchain one could represent all the functions, which one needs today for services such as AirBnB or Uber. It is possible to store in a decentralized manner and publicly available for all those who offer what products and at what price. You can store transactions, such as reservations, trips or overnight stays. Payments can be made through cryptocurrencies. And customers can rate the achievements. All without a central instance.
The blockchain returns the network to its open source
In a blockchain all transactions are publicly visible and are executed for all participants according to the same rules. Therefore, new entrants can offer their services relatively easily and use the liquidation processes immediately.
The web was completely decentralized at the beginning, and everyone could participate equally. The chain of blocks could return the network to its origins. It could eliminate the many central nodes that have been formed in recent years.
The path of decentralization
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The basic idea behind the World Wide Web was the principles of equality and free access to information that should benefit humanity. Unfortunately, smart people discovered that centralized systems can generate, store and process large amounts of data to generate large amounts of money. The era of Web 2.0 is here. Almost all Internet resources are concentrated in a few companies that control the market and the prices of services.
Today, however, we are seeing other trends that return to the roots. The solution is decentralized networks based on blockchain technology. Therefore, the operation can be divided among all the participants in the network. These technologies have their own drawbacks. Fortunately, historical developments are cyclical. In recent years, we have seen the development of technologies and this seduces humanity to the next step: the era of Web 3.0.
In terms of efficiency and reliability, a decentralized storage system based on distributed presentation technology is significantly better than the modern Internet. The future lies in the collaborative economy, in the reduction of spending and in rationalization. Decentralized networks are also much safer, apart from the mutual benefits for users. Data theft and so-called personal data leaks are almost impossible and make little sense. These systems are also faster and more efficient than their centralized predecessors.