Why You Shouldn’t Rely on Centralized Infrastructure for Web3
In 2021 and 2022, we have already seen the consequences of trying to run Web3 applications on centralized node infrastructure. There have been many cases of outages and censorship that were at odds with the principles of Web3 — autonomy, decentralization, redundancy, and censorship resistance, among others.
Centralized infrastructure providers have benefited from skyrocketing Web3 use over the past year. And they have seen massive billion-dollar valuations and involvement with Web 2.0 giants entering the space. However, their centralized blockchain infra creates barriers and imperfect conditions that make running dApps with these providers difficult for some Web3 developers to justify.
Providers like Alchemy and Infura power a broad swath of Web3 applications via their company-owned nodes stored mostly in AWS data centers. Centralized platforms like OpenSea rely on them for their node infrastructure necessary to communicate with underlying blockchains — but this could have adverse effects on operations that can cascade to other platforms.
The Perils of Centralized Infrastructure
Let’s take a look at a possible scenario from a mostly centralized platform that depends on centralized infrastructure to communicate with blockchains.
The Ripple Effect
- Alchemy’s servers experience an outage
- OpenSea’s services go down
- Twitter’s NFT feature goes down as it uses OpenSea’s NFT API
- NFTs are not easily verified — a breakdown in the UX and utility of non-fungible assets.
Now, what if OpenSea was using decentralized infrastructure for its platform? Let’s look at how the same situation could unfold: one cluster of independent nodes experiences an outage, Ankr’s load balancer automatically redirects traffic to other unaffected nodes in different locations, OpenSea’s NFT services stay up, and Twitter’s NFT feature stays fully operational.
Web 2.0 Business Models
Centralized providers focus on extracting value from users. When it comes to Web3, that’s just bad business. Centralized infrastructure providers take a Web 2.0 approach to business by using a subscription-based model that only rewards the company and investors. Decentralized infrastructure providers, on the other hand, reward independent node providers for all blockchain requests served and let users vote on issues via mechanisms like DAOs. This creates an economy instead of a one-sided relationship.
Vulnerabilities to Censorship
Platforms like OpenSea have drawn criticism for their censorship and bans of NFT collections. Having centralized infrastructure providers adds an additional layer of vulnerability to censorship as they can geofence services and implement other restrictions. Web3 is supposed to be the decentralized new layer of the internet that offers censorship resistance. This is a case-in-point for those who believe that protocols > platforms. Decentralized infrastructure means that independent node providers earn rewards, not just one company.
Web3 Communities Come Second
Centralized infrastructure providers are a business. Their priority is to create profit for the company and invested parties. Like many businesses, the users' needs often come second to profitability. In other words, the company will get what it needs at all costs. The users then become a means to an end rather than a valued community.
Decentralized Infrastructure Solves This
Developers have been looking for alternatives to centralized providers. Thankfully Ankr is here to provide decentralized Web3 infrastructure for NFT projects, DeFi protocols, metaverses, layer-1s, games, and much more.
With Ankr’s decentralized infrastructure ecosystem:
- Developers pay for affordable globally distributed access to on-chain data in ANKR;
- Independent node providers serve blockchain requests to earn ANKR;
- Stakers contribute ANKR to full nodes to share in the rewards.
Start using decentralized infrastructure for your dApp development today. https://www.ankr.com/protocol/public/
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