Centralized vs. Decentralized Web3 Infrastructure: What Should Developers Choose?

TL;DR

Web3 developers have three choices when it comes to accessing the node infrastructure necessary for building and operating dApps. They can run their own nodes, pay for centralized providers like Infura, Alchemy, and AWS, or they can use a decentralized infrastructure provider like Ankr. Ultimately, decentralized infrastructure is often the best option for the following reasons:

Running your own nodes is labor, time, and capital intensive with an additional set of technical skills needed.
Centralized infrastructure is antithetical to Web3 and provides vulnerabilities for censorship, failure, and manipulation while rewarding VCs and centralized companies.
Decentralized infrastructure offers a solution aligned with the original intent of blockchain tech. Developers reach a vast network of decentralized, independently run nodes with lower latency, more reliability, and high-performance standards while incentivizing node operators, users, and communities.

Introduction

Blockchain developers are building new Web3 applications faster than ever, thanks to the growing availability of infrastructure that allows them to communicate with blockchains without needing to set up their own nodes. This is known as the RPC (Remote Procedure Call) layer, which could be classified as a type of API (Application Programming Interface) that interacts with a network of nodes. These tools are vital for developers in building the dApps and open-source software that power Web3 experiences.

Building an RPC layer to relay information between blockchains, developers, and applications is no easy task. These networks need access to a vast amount of computing power and servers to power a network of nodes for blockchains. As nodes are the base layer of blockchains, without them decentralized systems would be impossible. The DevOps to set up and maintain one node is very difficult for most — building an infrastructure of, say, 2,000 nodes across 10+ blockchains is out of reach for most projects that want to build multi-chain dApps, to say the least.

That is why individual blockchain developers and projects seek RPC providers like Ankr to grant them hands-free access to interface with blockchains. These services allow them to make request calls to blockchains and read and write data to blockchains via the RPC extremely easily. In short, the RPC providers take the technical requirements out of the picture so developers can focus on creating dApps.

Centralized Providers: A Web2 Model for Web3 Systems

The internet, as we’ve known it for some time, relies largely on massive service providers like Microsoft, Google, and Amazon Web Services to provide the computing infrastructure to run the web and cloud-based operations housed in huge data centers. As these companies see a shift to Web3 and blockchain-based systems, they don’t want to be left out of the frenzy.

The node-as-a-service or RPC-as-a-service market is becoming fiercely competitive with both existing and new server infrastructure providers. Venture capitalists and established tech corporations are pouring hundreds of millions into the space. Also, the technical requirements for running a node continue to increase as blockchains grow in size and transactions per second.

These organizations have the money it takes to purchase a massive amount of influence and Web3 infrastructure. The question we need to ask ourselves is: do we want the same organizations and patterns that dominate Web2 to dictate the future of Web3?

What’s The Big Deal? Censorship & Control.

Using centralized goliath providers like AWS and Google, or new ones like Infura and Alchemy and others, to power blockchain systems is antithetical to the original premise of bitcoin, crypto, and the Web3 movement as a whole. These companies that monopolized much of the services on the first iterations of the web were a large part of the reason for the blockchain revolution in the first place.

The Concentration of Power

If a centralized provider or providers ended up gaining a majority of infrastructure control over a blockchain (or multiple chains) due to the number of nodes they operate, that could spell disaster for the security and continuity of decentralized systems. Additionally, if services like AWS don’t like a particular dApp, they could effectively shut it down, as they have with Web2 platforms.

Falling Prey to Government Regulations & Geofencing

Centralized providers could directly or indirectly bar users from dApps that use their infrastructure based on location, government sanctions, or other factors, as we’ve seen recently. Centralized providers make it clear in their terms of service that they must comply with all government laws and regulations, which means dApps dependent on them are also subject to censorship. As a decentralized gateway through which node providers and the developers and projects who need node services are matched, Ankr protocol allows independent service providers to set their own terms of service.

Gatekeeping and Overpricing

We all want Web3 to be as accessible as possible, so we want fewer paywalls and barriers to entry when it comes to interfacing with node infrastructure. Centralized providers don’t price their services for the communities — they do it to secure as much profit as they can. And for VC-backed providers, prices will more than likely increase every time they seek another round of equity.

A Single Point of Failure

Centralized Web3 providers like Infura and Alchemy use AWS data centers exclusively to house their nodes. This limits the global distribution of nodes leading to higher latency and creates a big problem if AWS goes down — all of the dApps that depend on these nodes to communicate with the blockchain go down with it.

Providers like Alchemy “want to do for blockchain and web3 what AWS (Amazon Web Services) did for the internet,” according to this TechCrunch report. It’s up to us to decide if we really want that.

But the bottom line is this: the foundation for Web3 needs to be decentralized. Otherwise, we are just building Web 2.1 — a centralized web with extra steps.

Decentralized Infrastructure: Better All Around?

Ankr is focused on improving the principles of autonomy and empowerment that have underwritten much of blockchain development so far. We believe that the crypto economy will be served best by self-funded communities and DAOs, not VC-backed service providers that run the same centralized path as Amazon Web Services.

This is exactly why we are shifting to provide public tools and more ways people can contribute to a self-sustaining crypto economy that comes full circle.

Ankr Protocol creates a decentralized infrastructure marketplace where:

Developers pay for access to on-chain data from node providers with ANKR;
Independent node providers serve blockchain requests to earn ANKR;
Stakers contribute ANKR to full nodes to secure the system and share in the rewards.

Ankr’s decentralized infrastructure is better all-around as it is:

Much faster and globally distributed for the lowest latency connections for users in all countries.
More reliable with fallback nodes worldwide on the load balancer serving traffic closer to users.
More affordable, with the majority of rewards going to independent node providers.
Higher performance as experienced node providers on Ankr adhere to stringent equipment and uptime requirements.
Resistant to the whims of government sanctions and regulations as independent node operators are not forced to comply with the same rules as centralized providers.
By the community, for the community, with the ability to vote on future protocol decisions, including reward distribution and pricing.

Additionally, Ankr Protocol’s paid plans allow dApps to scale affordably with pay-as-you-go prices for more power and endless flexibility. This provides the same (and better) options that centralized providers give their users with:

Unlimited requests
Global node distribution
Private endpoints
Prioritized requests
Advanced APIs
WebSockets (WS) capabilities

Final Thoughts

The necessary evils of Web2 (like centralized mega-providers) are no longer necessary. We have a once-in-a-lifetime opportunity to build a new layer of the web that provides autonomy, privacy, censorship-resistance, and self-governance without a need for profiteers capitalizing on its use. Decentralized infrastructure is the missing puzzle piece that allows us to build, transact, communicate, and earn rewards on the future web independently and scalably.

Follow Ankr here