Incentivizing decentralization in Web3 mechanisms

Develop mechanism design approaches for Web3 systems that explicitly incentivize decentralization among rational, strategic participants, ensuring that multiple independent providers are motivated to participate rather than allowing centralization by a single actor.

Background

The paper studies computation outsourcing in Web3, where decentralization is critical to avoid single points of failure, censorship, and monopolistic behavior. Existing platforms often assume decentralization or rely on any-trust assumptions, which may not hold with rational agents.

The authors analyze the trade-offs between decentralization and efficiency under revelation and non-revelation mechanisms, but note that the broader challenge of designing mechanisms that actively incentivize decentralization in Web3 remains unresolved.