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Design For The Decentralized World Democ PDF
Design For The Decentralized World Democ PDF
Democratization of Blockchain-Based
Software Design
1 Introduction
On June 12, 1992, Victor Papanek delivered a lecture at Apple (originally Apple
Computer; with less than 10 thousand employees at the time) entitled Microbes in the
Tower [1] in which he said: “I also believe very strongly in decentralization, largely
because I have the conviction … that nothing big works, ever, in any circumstances.”
His design and research at that time were focused on environmental issues and tools
that can promote greater autonomy for people in developing countries: with the final
aim being economical changes and improved quality of life. Victor’s theory is an
think about money, freedom, and technology. So, it is for us to find the new methods
and processes that can support the evolution of blockchain adoption and further
innovation.
Decentralization brings challenges to the traditional ways of software product
design: there is no central authority to control, decide or direct the future of the product,
which adds another dimension and requires process automation as its main factor. The
blockchain software is not controlled by anyone and at the same time being controlled
by everyone: as the value is distributed among all members of the network. Current
product design workflows and methods need a transformation to become open,
inclusive, democratic, and autonomous.
2 Research Methods
Methods of research used in this paper are mostly qualitative. Personal participatory
and non-participatory observations are combined with software design experience
inside and outside the blockchain field: as the basis of the problem definition and
understanding of practical blockchain usage. Literature and white paper reviews,
analyses of the decentralization trends and tendencies are coupled with the examination
of design and development tendencies before and after the existence of decentralized
technology. Consultations and interviews with field experts, further brainstorming and
feedback sessions helped to test the proposed concept and compare it to the other
possible solutions. Multiple case studies and comparisons serve as examples of current
state of blockchain technology and decentralized applications, along with the expla-
nations of its possible disadvantages. The final outcome of the discussion is presented
in the form of a blockchain-based autonomous software concept that suggests a more
democratic way of product creation, usage, and development.
3 Research Background
Each part of the research background block will define a concept and question its
possible usage, improvement or advancement in the present and future of the decen-
tralized world. It also discusses the applicability of certain ideas and methods used in
current software design processes. Below are the angles from which the problem of
blockchain software design could be viewed.
3.1 Blockchain
Blockchain is a technology that was created to serve the first digital cryptocurrency
called Bitcoin. At its core, it is an open distributed database, managed by a peer-to-peer
network through protocols and cryptography, supported by a consensus algorithm.
Block is an encrypted group of new transactions and chain is the network of computer
nodes [3].
Satoshi Nakamoto created Bitcoin as an electronic cash system that would allow
online payments without a financial institution. Above all, it was aimed to solve the
Design for the Decentralized World 77
weaknesses of the trust-based model of the value transaction, through a system based
on cryptographic proof; that allows the exchange without the need for a trusted third
party [7]. In fact, Satoshi’s anonymity and non-intervention is another eliminated
weakness of trust-based model: nobody knows who he is, thus there is no personal trust
involved, everyone can see the code and decide if the system works for them or not.
Will the problem of the third party and trust management remain if the creator of
the blockchain network is not anonymous, and participates in further development of
the blockchain? How can a blockchain system work in an even more autonomous way,
at the same time create consensus between the users and developers?
Dapps add another level of complexity to the blockchain trust and value paradigm,
as the decentralized application, blockchain, and currency are all involved at the same
time; certain qualities of one are not necessarily being transferred to the other. What
could be the optimal relationship between them and how can the transparency of the
decision-making be maintained? Can the processes of development and design be
autonomous in a way that would originate a better agreement between creators and
users of the blockchain and dapps?
4 Case Studies
4.1 Ethereum
Ehtereum was mentioned in this paper before. In summary, it is a next-generation smart
contract and decentralized application platform [17]. Vitalik Buterin, the creator of this
blockchain, took the core concept from Bitcoin and expanded the technology so it
could become more relevant and solve different problems, not just transfer and
exchange of cryptocurrencies. As a result, a global open-source platform based on
blockchain with focus on dapps was created.
Ethereum improved the technological side of blockchain, compared to Bitcoin, but
didn’t necessarily make it more costumer or user-friendly. Decentralized applications
do create value for some users and solve some problems, but the relationship between
the blockchain and dapps is quite subordinative: anyone who would like to use a dapp,
first need to understand how Ethereum works, and in order to do that, they need to
understand Bitcoin and blockchain. Additionally, concepts and technology behind it all
is hard and complex. The onboarding process is difficult especially with many unfa-
miliar technical words like consensus, chain, nodes, miners, etc. There is definitely
some potential for improvement with the change of the mindset and a bit of work from
user research and user experience writing.
Bitcoin was a solution to transfer value without any involvement of a third party
and reevaluation of trust management; Ethereum on the other hand is mainly a platform
for decentralized applications that is built on the same technology. Having the same or
similar technology does not necessarily create or transfer the same values, because the
solutions are different. Methods of design and development of a peer-to-peer electronic
cash system should be different and have additional focus points compared to a plat-
form or an ecosystem for decentralized applications. Ethereum is great compared to
Bitcoin in the aspects of functionality and application of the blockchain technology, but
compared to any other similar application ecosystem, like Apple iOS/macOS, Micro-
soft Windows or Linux, it is very poor and does not necessarily solve all the problems
an ecosystem should. There are many things missing from a good ecosystem: quality
and consistency of the system design and development, synchronization and constant
Design for the Decentralized World 81
communication between developers and users, high quality user experience and
usability, ecosystem based native solutions, clarity of definitions and functionalities,
strong user and development base, robust collaboration capabilities, high level of
support, just to name a few.
It is said that Ethereum is a foundation of the internet where infrastructure is
neutral, not controlled by any company or person [17]. Contrary to the creation of
Bitcoin, founder of Ethereum and the team behind it is public, so there is no anonymity
involved in the trust management between the developer and the user, which means
that the team behind the blockchain or events associated with them can easily influence
the consensus, value of the cryptocurrency, or the open nature of the platform. Right
now autonomy or neutral aspects are additional to the platform and are not in the core
of its processes. Developers of the blockchain have most of the power over the design
and implementation of future updates so the final product does not necessarily give a
user-centered solution. Even if the project has world class professionals, their decisions
are not necessarily driven by user needs and arrangements as a result will not bring
good user experience. Community, participation and discussions of the solutions are
not necessarily very open, and could be very technical; which leaves the average user in
a vague area.
There are different outside occasions that still influence the course and outcome of
people’s interaction with Ethereum: artificially created rumors about Vitalik’s car
accident made the ETH market value drop by four billion dollars, a blockchain update
led to a break in some smart contacts which created failures in many dapps, decisions
about consensus algorithm for Ethereum 2.0 might be a combination of PoW and PoS.
All of the above suggests that there is openness in the blockchain as a technology, but
not necessarily in the value of the cryptocurrency or in the decisions of the product
design and development; as openness leads to constant participation of many entities
with a result of a consensus.
There are projects similar to Ethereum that have already solved the problem
through implementation of voting mechanisms for the future upgrades: in Cosmos,
validators can vote for the direction they think would work best in the next update of
the blockchain so the solution that got most of the votes gets implemented. On the other
hand, there are projects like Tezos that similarly to Ethereum leave their users behind
the decision-making and create frustrations: after the Babylon update the type of a
delegation address was changed from KT to tz leading to constant errors in the
transaction processes.
Ethereum would move to the next level if it will become more inclusive and
transparent about its decisions and build a better communication between developers
and users. A voting mechanism on the blockchain is needed to truly make it neutral,
open and not controlled by any company or person. Just claiming the values of the
technology is not enough, removing one middleman and adding another one that is less
visible is not a solution.
Vitalik once mentioned in the VICE interview that, “a community can make money
for itself wherever it wants.” Only through democratic principles community will
define the value, logic, and qualities of the currency. ETH can be used by the com-
munity, same way it can use gold, but none of them are truly created by it, as only an
agreement of value is made.
82 V. Gladyshev and Q. Wu
4.2 CryptoKitties
CryptoKitties is a popular decentralized application built on the Ethereum network. It
uses the technology of the non-refundable token and smart contracts to record, breed,
and exchange digital collectibles in a visual form of a cat, that from the code per-
spective describes the relationship between the phenotype and genotype [18]. Many
similar games focus their mechanics and interactions on digital collectibles: Axie
Infinity, Etheremon, Gods Unchained, just to name a few.
Some problems of the Ethereum blockchain are also applicable to dapps. Although
these applications run on the blockchain, it doesn’t necessarily mean that the appli-
cation itself is decentralized, as they have the single point of failure being the team
behind it. The development team makes decisions, fixes bugs and decides on the
features of the new version of the dapp. Openness could also be arbitrary or limited as
the genetic algorithm that drives the cat reproduction is secret. Either way, users still
need to trust the team in order to trust the dapp and the network. Most of the decen-
tralized applications are not censorship-resistant as the team behind it would always be
politically centralized. Some even question the application side of the decentralized
applications, because they are being frequently used to do ICOs and raise money. In
other words, a dapp-specific token is used to raise money without any further obli-
gations from the team to deliver, also the project might not be a registered company or
business. In recent years, there were a lot of scam projects that took money from the
users and have never delivered anything.
Dapps are very blockchain specific and are highly dependent on the development
and updates of the chain and price of the cryptocurrency. Even though Ethereum
enables the development of dapps, the process is still hard and each update of the
blockchain might potentially bring some disruptions in the dapp ecosystem. People that
develop blockchain updates and people that develop decentralized applications are
often different, so each might not necessarily know of the possible problems that the
other side has. That is why, there is no surprise if a new Ethereum update will shut
down many of the dapps, as it happened before, and influence the economy of the
applications.
The gaming and entertainment parts of the applications on the blockchain are quite
questionable. CryptoKitties didn’t go far from concepts of coins or cryptocurrencies,
combined with the lack of play elements, dapps leave users with a collection of pure
visual-based value collectibles. Crypto-collectibles work the same way as the cryp-
tocurrencies with its main value being the price and the ability to collect, buy or sell; in
the end, it just becomes another form of investment. The reason behind it could be that
just the original execution of the game was not focused on the entertainment, but on
how to find a way to apply the technology; making the game an added value to the
blockchain, not a created value of the game itself. Moreover, dapps are expensive to
use and require prior studying, which makes the trust a first step of the application
validation for the user. Last but not least, there is not much practical usage of the dapps,
people don’t use them that much, especially if numbers of non-blockchain-based
applications are compared side by side. CryptoKitties is a technology looking for an
application, not a technology solving a problem or creating engaging ways of
Design for the Decentralized World 83
entertainment: dapps have a steep learning curve that doesn’t lead to entertainment, but
at the end creates a beautiful visual investment based on sophisticated technology.
From a broader socioeconomic perspective, dapps like CryptoKitties are trying to
explore if a digital good could be rare. With all the possibilities of breeding, combined
with the variety of cats on the market, it is almost impossible to understand what is rare
without any definition from the game designers. The concept of scarcity in the game is
also hard to understand because many of the users are driven by their subjective
attraction of the cats’ appearance. Besides, digital scarcity is brand new and unfamiliar.
Last but not least, only the code of that particular digital good belongs to the user, the
visual representation of the cat or the image doesn’t. The CryptoKitties company owns
all rights to the graphical elements of the cat, making it impossible to legally use the
image of the cat elsewhere.
Each user of the game has financial investments in it, as the cats can cost from tens
of dollars to thousands of dollars. But the design, development, other related solutions,
and updates are carried out by the developers that don’t necessarily communicate with
the users. Otherwise speaking, the development team can easily implement an addi-
tional feature to the overall cat genome and reshape the economy of the dapp, making
old cat genome combinations loose value, if they wanted.
At some point, we removed one middleman being a financial institution, added
back another middleman in the form of Ethereum and added another middleman being
the decentralized application development team. It is not as bad as it sounds and there
are some good dapps with teams that do a lot of user research, care to create something
good and highly usable, and solve problems, but it is a very small minority.
5 Discussion
Blockchain and decentralized applications are aiming to be open, transparent, solve the
problem of trust, value transfer, and bring solutions that would not require a third party.
In reality, due to the lack of democratic decision-making, participation of developers
and users in the process, user-centered design practices and autonomous voting
mechanisms, it only remains a slogan. The blockchain technology itself is open and
people can use it instead of a trusted third party, similar to how people use Bitcoin, but
the method through which it has been developed and designed remains subjective to a
small development community that lacks transparency in their decisions. Each
blockchain project, depending on its aim and audience should adjust and incorporate
project-specific processes and values. The design of Ethereum should inevitably be
different from the design of Bitcoin, as their nature and core functions are different.
Ethereum is an ecosystem or a platform with a high level of user and development
interactions, because of that it should focus on democratic, participatory decision-
making and constant involvement of the community.
Autonomous ideas in processes and structure of decentralized organizations are
truly revolutionary and with proper design similar values could be incorporated into the
design of blockchain technology and decentralized applications. The greatest value of
decentralization is autonomy, and the greatest problem with autonomy is its gover-
nance and rules that should at the end create an agreement between entities. The
84 V. Gladyshev and Q. Wu
6 Conclusion
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