There’s an obvious tension in the crypto world between decentralization and centralization. Of course, Bitcoin was a reaction against the power of the entrenched banking systems and a move toward individual economic empowerment. The essential element of blockchain technology is a distributed ledger, so it’s a reasonable desire for those who care about the technology to want the scale tipped toward decentralization. It’s also undeniable that some centralization often proves useful with scaling and building trust. But living within the tension between decentralization and centralization may be the key to empowering individual people by providing them with economic access. Manish Gupta, the EVP of Engineering at Coinbase, makes the case that Coinbase is equipped to democratize the crypto economy.
Main Takeaways
- Tension Between Decentralization and Centralization: Coinbase is living between the binary of a centralized versus a decentralized system. Fundamentally, by maintaining a balance between both paradigms, it has an opportunity to further democratize the crypto economy,
- Seeing Opportunity Instead of a Problem: When the crypto economy has boomed in the past, the Coinbase site has gone down, at times, due to the volume of users on the site. Trust is essential for Coinbase customers, so being able to solve for capacity issues is essential for sustaining that trust. In part, the solution to handling traffic issues has been to institute a series of tests to be proactive rather than leaning on a spike in the market to test the system. For Coinbase and Manish Gupta, these platform issues became an opportunity to strengthen the platform.
- Leaning into Decentralizing Technologies: Coinbase has made a strategic decision to lean into decentralized products. Overall, Coinbase plans to focus on decentralizing its workforce, products, and what it builds on the blockchain. One example of offering increased decentralization on the platform is creating wallets where assets can be individually held rather than combined into a larger pool of assets.
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