This article was first published on The Bit Journal. The crypto industry has spent years decentralizing blockchains, yet last Tuesday’s Cloudflare outage revealed a deeper structural weakness: many Web3 services still depend heavily on centralized web infrastructure.
Cloudflare Outage Exposed Critical Web3 Weaknesses
In the view of blockchain infrastructure builders, this will not be considered to be a resilient system until the entire technology stack, including consensus and smart contracts, is decentralized.
The Cloudflare outage, which caused an estimated 20% of the world internet traffic, had a temporary impact on a broad assortment of crypto services, such as Blockchain.com, Coinbase, Ledger, BitMEX, Toncoin, Arbiscan, and DefiLlama. The outage followed a previous example with Amazon Web Services (AWS) a month prior, and it supports the argument that Web3 continues to be susceptible to centralized breakdowns.
Resilience Requires Full-Stack Decentralization Efforts
Decentralizing blockchains is only one side of the equation, as an EthStorage spokesperson said on Wednesday. Although a full-stack system needs a network of validators and smart contracts, they claimed that resilience cannot be achieved without a complete stack.
According to them, real resilience means reconsidering the entire stack, not only the blockchain layer, RPC endpoints, DNS services, APIs, indexing, and storage remain highly affected when incidents such as the Cloudflare outage occur.
Yesterday’s Cloudflare outage showed how fragile Web2 gateways still are.
@Pieverse bringing x402b onto web3:// is a meaningful step toward payment rails that no longer rely on Web2 choke points.
As x402 grows into a broader standard, decentralized access will matter even… https://t.co/D100SukiCB
— EthStorage (@EthStorage) November 19, 2025
Projects Reducing Reliance On Web2 Infrastructure
Some of these platforms include EthStorage, Protocol Labs (via IPFS and Filecoin), and Arweave which are developing decentralized storage and HTTP alternatives to decrease dependence on Web2 infrastructure.
Outages like yesterday show how much traffic flows through a handful of centralized networks.
One issue in one region disrupts apps worldwide.
Filecoin Onchain Cloud supports a model that spreads risk instead of concentrating it. https://t.co/pa8TytgNzb
— Filecoin (@Filecoin) November 19, 2025
Filecoin has also remarked on the Cloudflare outage by pointing to disruptions like this showing the extent to which traffic is concentrated around a few centralized networks, and that dependencies on a single provider inevitably cause problems with system stability.
Outdated Assumptions Slow Web3 Decentralization Progress
EthStorage emphasized that centralized tools continue to be the default of many teams due to convenience or even familiarity. Developers tend to assume that decentralized solutions are slower, harder to maintain, or less user-friendly. The company claims that these assumptions are more and more outdated.
Consequently, numerous projects do not emphasize decentralization at first, but instead take it as an optional choice, not as a fundamental architecture concept, which is further exacerbated by the recent outage at Cloudflare. Nonetheless, EthStorage pointed out :
“Achieving full decentralization across every layer of the stack doesn’t have to happen overnight. What matters is that projects intentionally align their roadmap with this direction gradually removing centralized dependencies across execution, storage, and access as the project matures.”
By following this direction with roadmaps, it is possible to ensure that even no single vendor outage (including any future Cloudflare outage) can cause a protocol to stop working.
Vitalik Buterin Warns Against Centralized Dependencies
This increased attention is in line with the recent “Trustless Manifesto of Ethereum co-founder Vitalik Buterin. In the essay, researchers of the Ethereum Foundation and Yoav Weiss and Marissa Posner cautioned that protocols start to lose trustlessness immediately they use hosted nodes or centralized relayers. Although such integrations may appear harmless at first, each of them can be a potential chokepoint in an incident such as the Cloudflare outage.
Finally, the Cloudflare outage is a timely warning: The decentralization of Web3 is no better than the infrastructure supporting it. Crypto protocols will not be immune to the centralized failures that they are meant to counter until they are decentralized beyond their blockchains.
Conclusion
The Cloudflare outage highlights the fact that blockchain decentralization is not enough. Analysts encourage crypto projects to slowly decenter frontend, storage, and supporting layers, so that it is not susceptible to single-point failures. The actual lack of trust and soundness involves matching roadmaps to the principles of full-stack decentralization.
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Summary
- Cloudflare outage exposed crypto’s reliance on centralized infrastructure.
- Full resilience needs decentralization of frontend, storage, and APIs.
- Projects can gradually remove centralized dependencies over time.
- Vitalik Buterin warns hosted nodes compromise trustlessness.
Glossary of Key Terms
Web3: Decentralized internet ecosystem using blockchain technology.
Blockchain Decentralization: Distributed control via validators and smart contracts.
Full-Stack Decentralization: Decentralizing frontend, storage, APIs, and other layers.
EthStorage – Platform providing decentralized storage and HTTP solutions.
IPFS: Peer-to-peer network for decentralized file storage.
Filecoin: Decentralized storage network paired with IPFS.
Arweave: Protocol for permanent decentralized data storage.
Web2 Infrastructure: Traditional centralized cloud services like AWS.
RPC: Protocol for networked program-to-program communication.
Centralized Relayers: Services forwarding blockchain transactions, potential chokepoints.
Frequently Asked Questions about Cloudflare outage
1. Why was crypto affected by the Cloudflare outage?
Many protocols rely on centralized infrastructure for frontend and storage, making them vulnerable.
2. What is full-stack decentralization?
Decentralizing all layers of blockchain, APIs, storage, and DNS for greater resilience.
3. Why do projects still use centralized tools?
Centralized tools are familiar, convenient, and easier for smooth launches.
4. Can full decentralization be achieved gradually?
Yes, projects can remove centralized dependencies over time to improve resilience.
References
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