Decentralization Matrix

Decentralization is the key innovation that blockchain technology enables, and that can have significant technological, economic, and legal implications for web3 companies and protocols. Despite the importance of decentralization, the concept remains difficult to grasp and define. In the web3 spirit of collaboration and open source, we introduce two matrices to help enumerate the components of decentralization in the context of (1) tokenized blockchain protocols, such as layer 1 and layer 2 blockchains, and (2) tokenized smart contract protocols deployed to blockchains. We provide the matrices and more Latham resources about decentralization and web3 below.

Latham & Watkins, a leading global law firm, works at the cutting edge of blockchain-enabled innovation. Our team advises clients across the digital assets and web3 ecosystem, helping innovators and investors bring to market new digital assets, cryptocurrencies, NFTs, crypto derivatives and structured products, market infrastructure solutions, and blockchain-based protocols and organizations. We combine a sophisticated understanding of the technology underlying digital assets and web3 with a commercial sensibility and ahead-of-the-curve insight into the global regulatory direction of travel to advise and advocate for clients who are building and investing in this space.

Latham’s digital assets and web3 team works at the leading edge of blockchain-enabled innovation, often setting legal and regulatory precedents that govern new assets and industries. Learn more about our capabilities below.