Metaverse Weekly: Distinguishing Between Distributed & Decentralized Systems

Decentralization refers to the distribution of decision-making power from a centralized entity to a distributed network of entities. This is a common theme within the cryptoeconomy & blockchain applications.

There are a number of different technologies that can assist in the functional decentralization of the metaverse space. Some of the most prominent examples are:

  • Distributed Ledger Technologies (DLTs)
  • Edge Computing
  • Microservice Governance

The level of decentralization can vary depending on what is being distributed and how it is being distributed within a system. This will differ within specific organizations or companies versus critical infrastructure and networks. 

Many metaverse protocols within the cryptoeconomy (Decentraland, The Sandbox, etc.) utilize a type of distributed ledger technology (DLT) called a blockchain. However, not all DLTs are blockchains. This results in a high rate of variability in terms of decentralization even if the system itself is distributed.

Why Does the Metaverse Have to be Decentralized?

For the metaverse to truly flourish and remain accessible to everyone, it must be a highly decentralized system without any gatekeepers. This is what allowed the internet to grow into a unique, highly engaging, globally accessible interface. 

Centralization raises several issues for a system of global scale. Consider the internet – the wealth of exchangeable information is priceless for humanity. Nearly anyone is able to access the internet and receive a high-level amount of information on any topic.  

Of course, there are some major shortcomings in this regard that have been increasingly more noticeable over the last several years, including the monopolization of key web infrastructure and unequal, centralized access via internet service providers.

This is the major problem that web3 is trying to solve. A centralized global space results in:

  • Higher rate of monopolization
  • Greater censorship
  • Lack of accessible information
  • Reduced user privacy
Google’s Search Engine Monopoly –

What is the Difference Between Distributed and Decentralized Systems?

A common misconception is that distributed systems and decentralized systems are interchangeable terms. This is actually not the case – while decentralized systems (i.e. blockchains) are a type of distributed system, not all distributed systems are decentralized.

In addition to blockchains, here are three other examples of DLTs:

  • Hashgraph
  • Directed Acyclic Graph (DAC)
  • Holochain

Distributed Ledger Technologies

At its core, a DLT is a cryptographically secured record of consensus with a verifiable, validated trail. That trail is validated by a network of nodes. A DLT network can either vary in its level of decentralization. Designated rights on the networks between nodes can fall in a range from centralized to decentralized, meaning that not all nodes on the network must be equal.

Certain nodes on a distributed network may have much more prominent permissions than other nodes. For certain organizations, this is favourable as it allows for greater participation on the network without the organization having to give up control.

Blockchain Networks

Comparatively, a blockchain consists of unchangeable data pods referred to as blocks. These blocks are validated by nodes on the network and added to the previous chain, serving as a specific way to implement a DLT. 

The major distinction between blockchains and other types of distributed ledger technologies (DLTs) is that within a broad DLT network, every node does not necessarily need to have all of the information from the ledger. For a blockchain network, every single node has access to all of the information from the ledger.

How Blockchain Operates – ResearchGate

This is an important distinction to keep in mind when considering external companies like Meta and their own ambitions to build out a metaverse space. In Mark Zuckerberg’s 2021 Founder’s Letter, he explicitly states that privacy, safety, open standards, & interoperability need to be “part of the metaverse from day one” but offers no direct insight as to how Meta will provide these qualities in its own product.

For the purposes of decentralization & interoperability, it is exceedingly important that every participating node on a DLT network has access to and understands all of the available information. This promotes the highest degree of transparency and participation necessary to achieve a robust, decentralized, metaverse space.

Closing Analysis

It is important to counter the narrative that simply being distributed is equitable to being decentralized. This is completely untrue. The metaverse must be distributed AND decentralized to promote the healthiest space possible for the world to build upon. This reigns true for both individuals and brands/businesses.

Web3 and the emerging metaverse have some challenging obstacles ahead to ensure this vision becomes reality. Examples include problems with censorship & accessibility due to centralized internet service providers or simply the costs associated with building innovative computational technologies to actually power such a demanding system.

Nevertheless, what is highly achievable today is the implementation of decentralized distributed systems that allow for the free-flow of information to anyone who wishes to participate. This is what blockchain technologies add to the emerging metaverse.