Sufficient decentralization refers to the degree of distribution of control and influence within a blockchain network or decentralized application that renders it resistant to single points of failure, censorship, or undue manipulation by any single entity. This state is achieved when a large, diverse set of independent participants contribute to network operations, governance, and security. It is a subjective yet critical measure of a system’s adherence to core blockchain principles. This distribution helps prevent collusion.
Context
Sufficient decentralization is a constant and often contentious topic in cryptocurrency news, particularly when evaluating the true nature of various blockchain projects and their resistance to centralized control. Debates frequently address token distribution, validator concentration, and the power dynamics within decentralized autonomous organizations (DAOs). Regulators often consider this property when assessing the classification and oversight of digital assets.
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