Why The World Needs Decentralization

When the world welcomed the start of the new decade only a few short months ago, it did so with hope and anticipation. New years are always a time of resolutions and new beginnings, and this one seemed to be more significant — is the “roaring twenties” of the new Millenium. These hopes and aspirations could not have taken an unexpected turn any faster.

As of the start of May, those ambitions may seem like an unattainable wish list. Half of the world is under quarantine orders, and COVID-19 is spreading around the world at an increasing rate. Nearly a million infections globally, up ten-fold from only a month ago. Economies have been devastated, businesses have closed, and unemployment claims are piling up. Governments are scrambling to pass rescue stimulus packages to pick up the pieces — and to at least partially protect parts of the economy from further impacts. Even crypto markets have taken a beating, with the price of bitcoin reaching lows around the $4k mark in March. How is the world to recover from such a catastrophe? Where did we go wrong and how could this have been mitigated, if not prevented?

This article is going to explore the idea of decentralization, making the case that a decentralized world is a safer world — specifically in the areas of information dissemination and supply chain management.

In many parts of the world, censorship is an issue. It’s no secret that in China, the government seeks to control the flow of information to its citizens and to the rest of the world. This type of centralized control has proven to be dangerous to the entire world. As it pertains to COVID-19, there is ample evidence that the Chinese government sought to suppress the news of the spread, and even arrested doctors who sought to warn others in their communities.

An article published by the Guardian reports that Ai Fen, the director of the emergency at Wuhan Central Hospital, said that she was reprimanded after warning her colleagues about the unknown SARS-like virus she was seeing in her patients. Her original comments were published in an article in the Chinese magazine Renwu, which was quickly taken down by Chinese authorities. Thankfully, internet users were able to capture screenshots before the censors could remove the article.

Reports suggest that Ai knew about COVID-19 cases in December, nearly a month before the Chinese government confirmed that human to human transmission of the virus was occurring. When test results began coming back, they were circulated among medical circles. Ai was then reprimanded by her hospital’s disciplinary committee for “spreading rumors.” The hospital authorities told Ai and her staff not to wear masks or protective clothing, as doing so might cause panic in their patients. The doctors were forced to wear protective jackets underneath their doctors’ coats. Many of those doctors have since died from the virus.

Another COVID-19 whistleblower who faced censorship was Li Wenliang, a doctor also from Wuhan. After warning his fellow medics, he was told by police to stop making false comments, and was forced to sign a letter acknowledging his guilt for “severely disturb[ing] the social order.” Authorities would later apologize to Dr. Li, but their apologies were hollow as Li would eventually die from the virus he was seeking to contain.

These stories are just recent examples of the danger presented by centralized control of information. If doctors were free to discuss the disease, its implications, and request help, thousands of lives could have been saved in China and the world. Doctors would have been able to wear the PPE that they needed, and the virus would have been largely contained.

Censorship is only made possible through centralization, and in this case, it proved to be extremely costly to the entire world, who paid the high price in both human life and economic stability.

The COVID-19 crisis has been a wake-up call for the world and has exposed the fragility of the global economic system. Supply chains have been jolted, and has impacted nearly every industry as lead-time for materials has fluctuated wildly. Everything from manufacturing to medicine has been affected, and the results are visible on store shelves and in the storage closet. Some of this can certainly be attributed to the COVID-hysteria and anxiety, with the shortage of toilet paper being one of the mildest cases; other supply chain issues have proved to be deadly serious.

Cracks in the global supply chain began to surface in February after China, the world’s second-largest economy, declared mandatory lockdowns over vast swaths of the country. Quarantine orders and closures in Wuhan and beyond sent shockwaves through the global economy, where 81% of companies rely on Chinese suppliers. The China Council for the Promotion of International Trade reported that 4,811 force majeure certificates were issued as of March 3 due to the pandemic — contracts worth nearly $54 Billion. (For reference, the term “Force Majeure” refers to unforeseen circumstances that prevent someone from fulfilling a contract.) These events often describe natural disasters and absolve the issuing party from accruing any penalties due to not meeting the terms of the contract.

Probably the most notable supply chain shortage is related to medical supplies, which is exacerbated by the crisis itself. In the United States particularly, a shortage of testing kits and medical PPE (personal protective equipment) makes a dire situation worse. Lawmakers in Illinois and Maryland said, “we are flying blind,” in regard to the virus since the lack of testing kits allows the disease to continue spreading among an unaware population.

The sudden surge in demand for medical PPE sent prices skyrocketing, and wait times extending on backorder for up to six months for new supplies. The World Health Organization said in February that demand had increased 100x due to the limited supply. The surge of demand-led some companies to only supply masks to medical professionals. Dr. Mike Ryan, head of WHO’s health emergency program, said, “At every stage of the supply chain there is a possibility for disruption or profiteering or diversion… so this is not an easy problem to solve.”

But PPE is not the only medical items facing supply chain shortages. An online news site called The Pharma Letter reported that China accounts for 95% of US ibuprofen, 91% of hydrocortisone, 70% of acetaminophen, 45% of penicillin, and 40% of heparin. China is also responsible for 80% of the United States’ supply of antibiotics.

Such centralized dependence on foreign supply poses a double risk for any group of people:

1. What happens if that source becomes unreliable?

2. What if the source were to use your dependence against you? Chinese state media has openly discussed leveraging their production of pharmaceuticals against the United States, blocking components and supplies for dependent drug companies, and sending the US into “the hell of a novel coronavirus epidemic.”

The perils of centralization are obvious and are explicitly described in the paragraphs above. Ironically, the world has been planning to use a decentralized supply chain network as an emergency measure in the event of a global pandemic. The network, which is scheduled to be completed in 2030, was designed in response to the 2014 Ebola outbreaks in West Africa as one of the “lessons learned.” Key features of the platform will include data integration with existing logistics systems, as well as in-country warehouse management.

The Pandemic Supply Chain Network is an example platform that would be a prime candidate for blockchain application. Since blockchain is itself a decentralized network specializing in data storage and scalability, using this technology would be quite appropriate. A page written on this platform published on the world food program reads, “supply chain logistics are fundamental to any emergency intervention. Inadequate preparedness and response capacity lead to critical delays, costs lives and waste precious resources. By bringing together information on supplies and logistics and enabling analysis of supply chain inefficiencies, the new information platform, which will be part of the Global Pandemic Supply Chain Network, will promote timeliness and cost efficiency as well as aid in continuous improvement.”

Blockchain technology is able to address some of the most pressing issues facing supply chains, especially as it pertains to recording, transmitting, and sharing data.

First is the issue of regulatory compliance. Since supply chain data would be stored on a decentralized ledger, the data would be highly resistant to tampering, ensuring its integrity and transparency for all parties.

Second is the aspect of traceability. Every item in the supply chain could be traced, tracking its location with a timestamp and storing this data on the blockchain, where it could be monitored via a simple web-based interface.

In times of pandemic, increased efficiency is quite literally a matter of life and death. In times of peace, this efficiency would improve the livelihoods of potentially billions of people.

But in order to create the kind of efficiency needed to make a difference on a global scale, the blockchain network must have a strong technological backbone. While Bitcoin is adequate as a means of transferring large amounts of money efficiently through the Lightning Network, it certainly lacks in the area of scalable data storage.

The Phore Blockchain development team has spent the past year developing the most scalable blockchain technology in history through its implementation of sharding. What’s currently named the “Phore Synapse” project, this blockchain will be capable of speeds yet unseen with theoretical TPS potentially reaching into the hundreds of thousands, if not millions, and will allow for different shards to be optimized for different uses. The scalability afforded by this extremely high throughput will provide a fast, reliable, and lightweight backbone for logistics companies and organizations to optimize their supply chains. The world needs this kind of innovation. The world needs more decentralization. In the end, it could be a matter of life and death.

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