Proof that Majority Rules is the Maximum Achievable Decentralization for a Cryptocurrency

Updated: Dec 26, 2020

A currency only used by one person isn’t really a currency. Currency only achieves worth if it acts as an exchange of value between many people.

This means that currency requires an agreement between all users of that currency.

Specifically, everyone must reach agreement over the current value of everyone’s account balance. Typically this is done by giving the power to make these decisions to an organization. The goal of cryptocurrencies, as best achieved by Frink, is to give this power to the people instead.

What many would consider ideal is to have the rules for the currency set from the beginning, then have them be impossible to change even with significantly more than 50% of the network trying to change the rules. Unfortunately, it is possible to prove it isn’t possible to guarantee this.

Three things conflict to make this impossible: