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The benefits of decentralization

HUMAN Protocol
Mar 1, 2023

The benefits of decentralization

2 min read

After the collapse of FTX, we wrote about the importance of decentralization as relates to custody. Giving users true custody of their assets is one integral part of decentralization, but there are many other reasons that the HUMAN Protocol Foundation is actively decentralizing the network. 

A decentralized approach can offer a democratic, efficient, secure, and transparent network of real utility.

How HUMAN Protocol is decentralizing

The Coordination Layer (formerly Routing Protocol) is the mechanism of decentralization, and it addresses both the need for decentralized decision making – by voting – and decentralized operator services – by incentivizing individuals and groups to contribute to the network, and by providing the transparency and trustless infrastructure required to do so.

While the Coordination Layer is being built, we have made efforts to decentralize the decision making process via community votes on a) the Coordination Layer itself and b) the listing of HMT on LBank and c) a grant for a Maintainer of the Graph, which took place on HUMAN Protocol's new Commonwealth forum, a platform designed to ease decentralization. We have also begun the decentralization of operation by spreading the work transactions on the network across many blockchains, as supported by the Maintainer Program. The addition of new workpools, such as those of CVAT, also increase the decentralization of the network operationally.

Democratic access

One part of decentralization is permissionlessness. This means that anyone can access and use the network without the approval of a single central agent. One result of this is democratic access to the network and all the benefits entailed in using it. The perceived upside of a centralized gatekeeper is safety, but the staking and slashing mechanisms (outlined in the Coordination Layer paper), are designed to handle this issue.

Market efficiency 

Permissionless networks can result in market efficiency. This is a case of openness and freedom, rather than a top-down decision making. It is about giving the market the required flexibility to fulfil its wants and needs.

For example, in the machine-learning industry, data-annotation platforms often determine what can and can’t be annotated, either explicitly, or implicitly by the services and tools they offer. Such top-down decision making undoubtedly limits the potential of such services. It limits the potential of the industry, the business cases, and the products being developed.

HUMAN Protocol offers a permissionless approach to data annotation, for example. In this case, permissionlessness is complemented by flexibility and adaptability of the technology, which is open-source, with customizable solutions to facilitate an ever-expanding array of options and use cases (as reflected by the grantees). Open-source technology is key to creating a system that is agile enough to deal with an area as diverse, demanding, and fast-moving as machine learning and data annotation.

This same principle applies to whichever industry HUMAN Protocol may be used in. The Protocol is open-source, adaptable, and useful. It allows companies to bring the tools they require to fulfil the work they need to get done; it is not determined by a centralized entity.


A more technologically diffuse and decentralized framework has the potential to be more robust than one with a single point of failure. Spreading the operation of the network across many applications and networks decreases the risk of the network going down. 

First of all, hacking a blockchain is very difficult, if not virtually impossible; spreading a network such as HUMAN Protocol across many blockchains makes it a robust infrastructure with diminished vulnerability to hacks. The same can be said of further kinds of operational decentralization, such as including more exchanges on which users can access HMT, more workpools for Requesters to tap into, more Requesters for Workers to get work from, more Exchange Oracles to fulfil the processing of the work, and more Recording and Reputation Oracles to check and payout work.


As much as transparency is a prerequisite for decentralization, it is also a result of it: decentralization of a network via blockchains, run by community votes, is by its nature a transparent system. While decentralization results in transparency, transparency creates a framework for meritocracy, accountability, and trust.

Those are valuable qualities and principles when creating a new technological infrastructure.

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Legal Disclaimer

The HUMAN Protocol Foundation makes no representation, warranty, or undertaking, express or implied, as to the accuracy, reliability, completeness, or reasonableness of the information contained here. Any assumptions, opinions, and estimations expressed constitute the HUMAN Protocol Foundation’s judgment as of the time of publishing and are subject to change without notice. Any projection contained within the information presented here is based on a number of assumptions, and there can be no guarantee that any projected outcomes will be achieved.

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