Decentralization beyond Blockchains- The role of P2P ecosystem

9 min readJan 25, 2022

The advantages of decentralized P2P distributed network applications far outweigh the minor set-offs that it comes with. In contrast to the centralized applications, decentralized apps have opened the door to a new era where one does not need to rely on central authorities for trust, reputation and identity. Here is a look at how it goes beyond blockchains and has significant positive implications for various industries.


The decentralization trend has been picking up rapid momentum over the last few years despite having been in existence for several years. At the core of blockchain technology lies the peer-to-peer (P2P) decentralized model. Over the last few years, peer-to-peer ecosystems have gained traction and more so with the advent of cryptocurrencies, the advantages these ecosystems provide are being explored by an increasing number of businesses across all industry verticals.

P2P networks are made up of two types of nodes: seeders, which are responsible for storing and sharing the files, and leechers, which request the information they want from the seeder. In contrast to the client-server model in which a server fulfills requests initiated by a client, P2P networks do not require an intermediary to operate. A peer-to-peer network is free of any central authority and serves as a communication model for two individuals, groups, or peers to function irrespective of the presence of a central server.

However, decentralized P2P models are not just about blockchains. Decentralized technologies are based on a broad set of ideas that enable new business models and value exchanges with more control and ownership, opening the door to a new era where we do not need to rely on central authorities for trust, reputation, and identity.

This article focuses on some emerging peer-to-peer decentralized technologies that go beyond blockchain, and how they offer new opportunities for businesses across industry verticals.

Decentralization Peer-to-Peer network — a brief summary

Decentralization is a prominent underlying feature of blockchain technology. In a centralized network, users are forced to trust an entity to authorize transactions and secure the network. In a decentralized network, each node maintains its own copy on the distributed ledger technology that is blockchain, which in turn allows it to verify transactions and prevent attacks from occurring.

In reference to the revolutionizing blockchain space, decentralization refers to the transmission of critical powers as that of management, decision-making, and policy formation from a centralized authority to a dispersed network. Hence, the powers in a decentralized framework do not remain concentrated in the hands of a single entity. Blockchain is a decentralized network that has been designed to reduce the level of trust placed in an individual, organization, or group. It does this by reducing the ability of one party to exert control over another. Blockchain technology leverages the power of peer-to-peer networks and provides a trusted and shared record of transactions.

Decentralized P2P ecosystem is critical for businesses

Decentralization is not a completely new concept but has been around for several years. Three leading network architectures are generally taken into account when designing a technology solution: centralized, distributed, and decentralized. Although blockchain-enterprise-based applications often run on decentralized networks, a blockchain application itself cannot be considered simply as being decentralized or not. In fact, all aspects of blockchain applications need to be decentralized.

One can achieve a more effective, prominent, and pleasant experience by decentralizing the management of and ownership and control over resources in a blockchain application. Even though there are some set-offs in decentralized peer-to-peer models such as lower exchanges, these set-offs are worth the improved security and better service levels they bring in.

Benefits of decentralized peer-to-peer networks

In contrast to centralized applications, decentralized P2P distributed network applications are operated by a network of members where no single entity or a group has complete control. Transactions carried out on the decentralized networks can be validated and verified by participants among each other as there is no central authority to approve financial activities. The peer-to-peer decentralized applications empower people and businesses to trust the output without even knowing the participants as each node has the capability to store, transmit and receive files. Below are some of the most significant benefits of decentralization:

Facilitate a trustless environment: A decentralized blockchain network does not require members to know each other or trust intermediaries to carry out transactions. It reduces or eliminates the need for members to put trust into third-party intermediaries.

Single point of failure is less likely: Unlike the case of centralized networks, no single node can bring down the entire network completely in the decentralized network regardless of the number of users operating there. Hence applications can keep up and running.

Less censorship: A peer-to-peer network leaves little or almost no scope at all for governments or institutions to censor nodes on which communication is carried on between peers to peer on the decentralized network.

Serve as development platforms: Individuals, businesses, and organizations can design innovative tools, products, and services on top of the decentralized peer-to-peer models- something which centralized technological applications do not allow! In contrast to the centralized structures characterized by limited development opportunities, businesses can explore umpteen possibilities to grow enormously due to the effects of all amazing tools being built on top of decentralized networks.

Potential for network ownership alignment: In contrast to centralized networks where only controllers of the network receive value, anyone in the decentralized peer-to-peer network contributing value to the network can receive an economic stake. Hence, blockchain decentralized P2P networks create the right incentives for value contributors, offering them rewards as the network grows and thus emerging as an exciting platform.

Resistant to cyber-attacks: Each node in the decentralized P2P network holds a copy of the data and each member in the network has access to the exact same data as recorded in the distributed ledger. It is difficult to alter or tamper with any data on the network as it is unfeasible to change multiple nodes on the blockchain. The distributed architecture of the peer-to-peer operating model makes it extremely resistant to cyber-attacks. Any change in the ledger or attempt at corrupting the digital record in any way will be foiled as the majority of the members in the network would be able to catch the slightest of tinkering with the records.

Optimize resource distribution: The decentralized P2P networks can optimize the distribution of resources, thus leading to faster and more efficient services. Users running their business model on the decentralized networks can yield better performance and consistency, reducing the probability of a disastrous failure.

Decentralising the Internet of Things (IoT)

The existing Internet of Things (IoT) ecosystems depends on brokered, centralized communication models. These are often incompatible with the requirements of enterprise IoT deployments, which include the need for a decentralized security capability. This model has been running for decades now with computing devices but there is a need for a decentralized approach for the ever-expanding IoT systems for tomorrow.

The exorbitant cost pertaining to maintenance and infrastructure associated with the networking equipment, server units, and centralized cloud storage facility makes the current IoT solutions pretty expensive. Despite finding solutions to challenges involving the cost and engineering capabilities, cloud servers can turn out to be a point of failure that might upset the entire network. Given the fact that human life and critical aspects such as health heavily rely on IoT, a decentralized P2P approach to IoT networking can be truly significant.

Paving the way for a decentralized, peer-to-peer model for computing and processing countless transactions occurring between devices will curtail costs of installation and maintenance of large centralized data centers. The decentralized P2P model will facilitate effective and real-time sharing and distribution of computed data and provide storage needs across endless devices that are a part of IoT networks. Moreover, it would also thwart the possibility of a catastrophic collapse of the entire network because of the failure of any single node that might happen in centralized networks.

However, peer-to-peer communications is not free of challenges, and the one that needs to be addressed primarily is that of security. IoT security goes much beyond the concept of protecting sensitive data and adopting a seamless decentralized solution should be able to meet the high privacy and security requirements of running huge IoT networks. A decentralized solution must provide some form of validation and consensus for transactions to avoid data theft and tampering.

Decentralized P2P model for Finances and Economy

Decentralized finance, or DeFi, employs cryptocurrency and blockchain technology to create peer-to-peer financial markets. DeFi aims to replace legacy institutions with decentralized relationships that can provide a full spectrum of financial services, including lending, borrowing, trading, mortgage, and so on.

Decentralized finance, or DeFi, has become popular in the last few years as it offers people the chance to monetize and trade their assets without being under control or by using a centralized system. DeFi serves as an open financial system that does not discriminate against anyone and is transnational in nature. It runs on smart contracts supported by a blockchain network.

There are a number of DeFi applications that have been created to facilitate better financial services. These include decentralized exchanges, lending platforms, stablecoins, prediction markets, and more. Yield farming, staking platform, liquidity mining, and compostability are some of the other concepts that have been built around the DeFi.

Although centralized exchanges have some benefits, the disadvantages far outweigh them. This led to an increase in demand for decentralized exchanges facilitating P2P transactions.

DeFi exchanges don’t use third-party integration. All the data regarding the transaction is stored on the blockchain network. With decentralized exchanges, users are in more control of their assets than they would be with a centralized exchange. Also, it prevents hackers from stealing sensitive data or tampering with any information. The fee to use DeFi exchanges is also less than traditional exchanges.

DeFi is a technology that enables the creation of open, borderless financial services provided by individuals with the power of blockchain technology. It uses a peer-to-peer network to keep records on thousands of computers, which makes it more secure than traditional finance with its single point failure point.

Other use cases of decentralized peer-to-peer networks

Peer-to-peer, decentralized networks are almost everywhere now — there are peer-to-peer car rentals, financial transactions, lending borrowing, and so on. In fact, the peer-to-peer network has also been of great benefit for the insurance sector. Some of the energy giants have also used the P2P network for energy trading. The advent of cryptocurrencies has further pushed the adoption of P2P technologies with more than 2000+ cryptocurrencies — from Etheruem, Bitcoin to Peercoin leveraging the peer-to-peer solutions. Streaming platforms, educational institutions, multimedia broadcasting houses, web search engines, online marketplaces, and so on are all making best use of the P2P models. However, blockchain technology is at the forefront when it comes to using P2P networks.


Although decentralized peer-to-peer applications are taking on the world by storm some industry players are still shying away from their adoption. Decentralized applications are still in their infancy. Businesses need to follow a more liberal approach in reviewing the pros and cons of decentralized applications and give these innovative solutions a try to help them take the lead in shaping a new ecosystem.

The decentralized P2P model can also facilitate far more and better opportunities and also revolutionize the existing infrastructure. Policymakers, financial institutions, and businesses across the world have started taking note of the benefits that decentralized peer-to-peer networks bring in and are gradually shifting focus towards integrating blockchain-based decentralized P2P applications into their systems to achieve their desired objectives.

Decentralized P2P solutions could prove to be an instrumental vehicle for realizing significant public policy goals of establishing a fairer, efficient, and also transparent ecosystem. Make decentralized P2P networks an integral part of your operating business model for achieving the mission of better financial inclusion. With decentralized applications, businesses and policymakers can address all the pertinent concerns which could not be resolved with the centralized applications. The decentralized P2P technology and popularity of crypto will undeniably bring about new heights in terms of accessibility for everyone.

zSCAPE’s decentralized peer-to-peer applications

Come to zSCAPE if you need to leverage the power of peer-to-peer decentralized applications. It provides the perfect platform, delivering Blockchain-as-a-service (BaaS) solutions for the development of businesses — both established and new ones. Even crypto startups and blockchain new entrants can design, deploy and also integrate robust decentralized P2P networks and apps within their working systems. The advanced analytics and low code automation tools in this system make it easy for you to produce metrics reports tailored specifically towards your needs. Thanks to their robust API set, businesses across industries can deploy and manage DApps effortlessly using DeFi space like trusted storage or smart contracts without facing any trouble at all.

The team at zSCAPE has experienced blockchain engineers and experts with a deep understanding of how peer-to-peer networking works and how it can be leveraged to ensure all the desired business objectives of an enterprise are met in an effective and timely manner. All that we deploy, design, and the decentralized P2P working solutions we provide services as a testament to our passion for facilitating innovation, integrity, and growth for our esteemed partners! Discover the fruits of integrating the decentralized solutions and also unravel the best value propositions in decentralized financial protocols and solutions customized for optimizing the customer experience.

Originally published at on January 25, 2022.




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