Decentralization by blockchain is a guiding belief that several cryptocurrency projects in recent years have espoused. To date, however, very few have accomplished this goal. With startups and multinational corporations jumping on the decentralization bandwagon, it is perhaps time to pause and think if we have lost sight of the ultimate purpose of blockchain?
Talking the talk is easy. A large percentage of global companies in the world are embarking on all forms of experimentation, from the trivial to the ambitious. From expressing the desire to distribute control over time to boldly outlining the roadmap for the transition from permissioned to permissionless—blockchain’s allure is much too powerful. But have these blockchain projects merely reduced to making decentralization by blockchain a profit-making tool? Clearly, walking the walk isn’t so easy.
To date, of the several thousand blockchain projects launched so far, only a handful seem worth looking forward to or investing in. The fate of most of them, unfortunately, spells failure. Below is a rundown on few media-hyped projects that failed to take off as they lost track of the path to greater decentralization by blockchain somewhere along their journey.
Telegram Open Network (TON) – Destined for failure?
Telegram founder and CEO Pavel Durov took the cryptocurrency world by surprise when he unceremoniously announced the end of his beloved blockchain platform TON on May 12, 2020, after raising a whopping $2 billion in 2018 for its development. The TON coins or the Grams, underpinned by the TON blockchain network, were hailed as the future coin for regular exchange of value.
Referring to Bitcoin as the digital gold and Ethereum as the platform for token crowd sales, TON’s extensive whitepaper claimed Grams to be a viable substitute for popular electronic payment platforms like Mastercard and Visa. Telegram also outlined its obvious plus points, such as mass usage, expertise in encrypted cloud-based instant remittances, and user-friendly interfaces.
However, very little was known or written about how an instant messaging platform would go about implementing this new financial system. What is it that they would do differently to make this currency stand out? And ultimately, how was it any different from other centralized monetary systems that control the value and the distribution? As expected, Telegram offered no satisfactory answers. It thus halted its mission to achieve optimum decentralization by blockchain, following a row of legal scuffles with the United States Securities and Exchange Commission (SEC).
Petchains – poorly designed or just a plain bad idea?
Petchains was marketed as a platform dedicated to regulating and overseeing information surrounding the world’s pet market, which is over 55 percent of the global economy. The system sought to enable pet owners worldwide to store and maintain data of the sheltered animals and birds, share and resolve issues concerning them and create a conducive environment for the community, medical service providers, volunteers, and caregivers.
While all of this seems like a good initiative, one wouldn’t help but wonder if the world really needs a pet care platform based on modern-day technologies like blockchain and big data? Is it helping us achieve the ultimate aim of decentralization by blockchain? Customers choose pet shops based on their reputation and word of mouth references, so to think that this industry is troubled by over-centralization seems frivolous.
Yes, there are issues concerning the unreliable or inadequate information about the pet animal; however, given that different countries have different regulations on how to own, adopt and care for a pet, it was evident that blockchain could do very little about it. A unified, universal pet information platform was not the solution.
Petchains’ founders and team members lacked credibility. The whitepaper only barely touched upon the blockchain project details and vaguely used terms like decentralization, transparency, and permissionless to explain its alleged decentralization by blockchain motive. Needless to say, the blockchain project failed to attract investors and customers.
Wiki Tokens – taking it too far with decentralization by blockchain
Over the last decade, thousands of cryptocurrencies have been created, and more than 90 percent of them have doomed. There’s no denying that given the insane success stories of most ICOs, scammers end up flooding the market, making us look at the facts with rose-tinted glasses. The phrase decentralization by blockchain is merely reduced to being a vehicle to fame, as few entrepreneurs seek to change the world with revolutionary concepts.
The Ethereum-based Wiki token is one such example of unnecessary innovation. These tokens created the purported Crypto University, where members would get Wikin tokens to create and publish content on cryptocurrencies. Much like Coursera, an open-source online educational content provider, Crypto University, too, sought to bring together consumers and content developers under one unified educational information sharing platform.
However, the problem was that the educational material was written and published by unverified and unreliable creators. Contrary to Coursera, where teachers and professors from reputable academic institutions offer online coaching, live interactive sessions, and valid certifications to their students, Crypto University’s content lacked value and expertise in the given field.
It’s no wonder that the project didn’t launch as the concept was flawed right from the beginning. Why would students prefer to trade tokens for obtaining material from unverified sources? Wouldn’t widely available and free YouTube videos make the cut? For the token to be decently valuable in the long run, there must be sufficient demand.
Decentralization as an end goal
Tokenized learning, based on the concept of decentralization by blockchain, can take control back from the centralized education institutions and bring about reliability, efficiency, and convenience of learning from home, along with a host of other benefits. The peer-to-peer platform enables learners to coordinate directly with their teachers and content creators, allowing them to experience personalized learning, and that’s a revolutionary innovation. The question is not whether blockchain can provide an alternative, but whether it needs to.
More often than not, the cryptocurrency industry’s failed blockchain projects, in a hasty attempt to make the most of the popularity of decentralization by blockchain, bring no value-added services to the consumer. Their primary focus remains the product and profits, and rarely do they put thought into how it will resolve consumer issues and be of meaningful value. Perhaps the most important item to remember, especially if blockchain is an augmenting technology, is to keep it simple.