The centralization drift: Web3 risks losing its soul | Opinion

When Bitcoin (BTC) was born, it carried with it a simple but revolutionary premise: trust the math, not the middleman. Cryptography promised a world where value could move freely — permissionless, borderless, and without the layers of gatekeeping that defined legacy finance. It wasn’t just a new technology; it was a rejection of centuries of financial hierarchy.

Crypto was supposed to free us. From banks. From gatekeepers. From the small group of institutions that decided who could move money, build markets, or define value. It wasn’t just a new asset class; it was a new operating system for trust itself.

Yet, as we are approaching 2026, that founding ethos is eroding. We’ve replaced the old hierarchies with new ones. Centralized exchanges act as de facto banks. Layer-2s are governed by multisigs run by insiders. “Decentralized” autonomous organizations are ruled by a handful of whales. And the very idea of user sovereignty — the promise that no single actor can pull the plug — is fading into marketing language.

Web3 doesn’t need another hype cycle. It needs a hard reset.

From decentralization to dependency

The fall of FTX, the slow collapse of Celsius and BlockFi, and even the growing regulatory capture of major stablecoins all stem from the same problem: too much control in too few hands.

Crypto’s greatest failures haven’t been technical — they’ve been human. Whether it’s mismanagement, corruption, or simple arrogance, every centralized failure in this industry reaffirms why decentralization mattered in the first place.

We’ve learned the wrong lesson from those collapses. Instead of building systems that can’t be corrupted, we’ve built systems that promise not to be corrupted — until they are. When governance tokens consolidate among a few addresses, when founders hold the keys to “emergency upgrades,” when DAOs can be hijacked through proposal manipulation, decentralization becomes a façade. What’s left is a permissioned playground masquerading as a revolution.

The new face of centralization: Convenience

Ironically, the biggest threat to decentralization today isn’t regulation — it’s UX. The crypto mainstream doesn’t want to think about seed phrases or gas fees. They want what web2 offered: seamlessness. Custodial wallets, centralized bridges, and “trusted intermediaries” are creeping back in, packaged as user-friendly gateways.

We’ve even given this trend a name: Web2.5.

It’s the compromise that allows institutions and traditional finance players to dip into web3 safely. Coinbase’s Base, Binance’s Web3 Wallet, and Telegram’s TON are gateways that merge on-chain infrastructure with off-chain custody. It’s easy to see why this hybrid model appeals — it delivers accessibility, liquidity, and compliance. But it also reinforces dependence. When convenience becomes the top priority, decentralization becomes optional.

We’re in danger of building an internet of permissions all over again — just with new gatekeepers wearing hoodies instead of suits.

TradFi and web3: A fragile symbiosis

To be clear, collaboration with traditional finance isn’t inherently bad. In fact, it’s inevitable — and necessary.

Banks, payment networks, and institutional investors are no longer ignoring blockchain; they’re embedding it. The result is a fascinating hybridization: the transparency and efficiency of decentralized infrastructure meeting the scale and regulatory stability of legacy systems.

This synergy is healthy — as long as the power dynamics stay balanced. If TradFi integrates web3 without adopting its principles, we’ll end up with the worst of both worlds: a financial system that’s just as centralized, but now cloaked in the illusion of transparency.

True innovation isn’t about absorbing web3 into the existing order — it’s about rewiring the order entirely.

Transparency as infrastructure

The next stage of decentralization isn’t anarchy. It’s accountable autonomy. Transparency is now the competitive edge. In a global economy where distrust in institutions runs deep, systems that offer verifiable, on-chain truth will outlast those that rely on PR. That’s why regulators are gradually shifting from resistance to collaboration, realizing that blockchain, properly implemented, can make compliance more efficient, not less.

But this evolution cuts both ways. Transparency without decentralization becomes surveillance. And decentralization without transparency becomes chaos. The only sustainable model is one where code enforces fairness, and data enforces accountability.

If crypto is to reclaim its moral center, it must lead this transformation — not as a financial experiment, but as an ethical one.

Rebuilding trust without intermediaries

As we stand on the edge of another bull cycle, it’s tempting to believe that rising prices mean progress. But we’ve been here before. Each time, speculation outpaces substance, and the foundations remain fragile.

This time, we can’t afford to let hype drive the narrative. The path forward is about earning trust without intermediaries — through ungoverned architecture, open code, and systems that can’t betray their users.

DeFi isn’t just an alternative to banks; it’s a blueprint for reimagining finance as a public utility. Smart contracts are the new compliance officers. DAOs, when designed correctly, are the new co-ops. NFTs, stripped of the mania, are simply programmable proof of ownership.

Every part of this stack points toward a singular mission: freedom from unilateral control.

The choice ahead

Centralization is comfortable. Decentralization is hard. But only one of them is worth fighting for. As web3 matures, we must decide what kind of ecosystem we want to inherit. One where convenience eclipses sovereignty — or one where autonomy scales without permission.

True decentralization isn’t about removing humans; it’s about trusting humans less and coding more. Transparency isn’t about surrendering privacy; it’s about making corruption impossible. 

Crypto was never meant to be easy — it was meant to be honest. And honesty, in the end, is the only form of trust that doesn’t expire.