Crypto Needs Compete Decentralization And Cloudflare Outage Just Proved It

The web went dark on Tuesday, 18 November. At least parts of it that rely on Cloudflare’s infrastructure to keep the front end lit.

And just like that, one brief hiccup of the CDN giant was enough to turn even the most decentralized blockchains like Blockchain.com or Coinbase into a frustrating, inoperable mess. Suddenly, dApps and Web3 services that rely on Cloudflare’s infrastructure to power their front ends were inaccessible for several hours.

Predictably, the decentralization debate was back in full swing. Is crypto truly decentralized if it still depends on Web2 services to keep up and running? Can blockchains really stand on their own without centralized infrastructure holding the web together?

Most importantly, is there anything we do about it?

End-to-End Decentralization: The Way Forward?

If you ask the folks at EthStorage, the solution lies in complete decentralization.

Following the incident, a spokesperson from the company took to social media to emphasize how “only fully decentralized payments need fully decentralized front ends.” In other words, if blockchain is the future of finance, its entire ecosystem, from the smart contracts to the user interface, needs to be built from the ground up using decentralized infrastructure.

Taking it to the next level, EthStorage urges for what they call “end-to-end decentralization,” meaning blockchain plus everything that supports it. That includes Remote Procedure Calls (RPC), Domain Name System (DNS), APIs, indexing, and, crucially, storage.

In their words, this would create an ecosystem where no single point of failure could take everything offline.

Decentralization: Crypto’s Oldest Pipedream

Here’s the kicker: pure, unadulterated decentralization is the Holy Grail of crypto, but is it attainable? If so, at what cost?

The thing is, the Internet we all know today was never designed to be decentralized. Sure, we’ve got decentralized blockchains, crypto tokens, and what not; but the rest of the tech stack is still running on the old, centralized playbook.

Plus, let’s not sugarcoat it: decentralization ain’t cheap. Building a wholly decentralized infrastructure that can rival the Web2 giants like Cloudflare would take more than throwing tokens and dApps at it. Not to mention the speed, efficiency and the maintenance costs.

Decentralized DNS providers like Handshake and blockchain storage networks like Filecoin and Arweave are slowly chipping away at the foundation. However, they’re still years before they can be considered mainstream.

What’s Next?

So what then, do nothing?

Not really. Crypto can’t keep pretending like these vulnerabilities don’t exist. To quote from Filecoin on X: “Relying on a single cloud provider creates limits for any society that depends on stable access to data.”

And that right there is the key. The crypto cannot really afford to put its eggs in a single cloud basket. Relying on centralized infrastructure isn’t just risky, but counter to the whole ethos it was founded on. One outage, one attack, and everything can come crashing down, leaving the whole ecosystem at the mercy of a few giant players.

The good news is that decentralization can happen gradually. To borrow once again from the good people at EthStorage: “What matters is… gradually removing centralized dependencies across execution, storage, and access as the project matures.”

Here’s another good news: the crypto revolution isn’t going anywhere. We’ve got projects like Filecoin, Arweave, and IPFS pushing the needle toward a decentralized web, and the Cloudflare outage can only puff wind into their sales further.

The road ahead may be long and fraught with challenges and naysayers, but if history tells us anything, it’s that when the tech world gets its back against the wall, innovation happens. Will decentralization win? Well, if it were part of the prediction markets, we’d wager on it.