Blockchain’s net neutrality problem

In the darkest recesses of authoritarian dystopia, an existential threat to blockchain technology lurks. It is the revoking of net neutrality.

As Satoshi Nakamoto described in his paper “Bitcoin: A Peer-to-Peer Electronic Cash System” “Proof-of-work is essentially one-CPU-one-vote. The majority decision is represented by the longest chain,”…”that the probability of a slower attacker catching up diminishes” as long as “nodes always consider the longest chain to be the correct one and will keep working on extending it” and payment verification is achieved by “linking it to a place in the chain, he can see that a network node has accepted it, and blocks added after it further confirm the network has accepted it.”

The key concepts here is that the verification system is possible because everyone can “see” that  transactions were accepted by the blockchain. This transparency could be threatened by net neutrality’s removal. ISP B could in theory begin a competing blockchain business and charge their customers to use a competing services.

 

interferes with when they Firewall the internet.

If computers on the network are allowed to interfere with the blockchain by blocking communication with other nodes on the network, payment verification is impeded. This encourages bad poisonous actors to not “play by the rules”. This is the essence of net neutrality rules is there to prevent.

I do not think it is that far a stretch to think that AT&T could in theory start a competing blockchain and act as a broker or trusted third part to the outside bitcoin network. This is a walled garden, giving ISPs de facto monopoly over the internet application and services.

The verification mechanism is known as the “double-spending problem” and Nakamoto solved this issues by implementing the peer-to-peer blockchain.

Revoking net neutrality compromises the blockchain solution to the double-spend problem because a spending “tie” is broken “…when the next proof-of-work is found […] nodes that were working on the other branch will switch to the longer one.” Revoking Net Neutrality will cause a payment issues for the neutrality victim who is on the wrong side of the Firewall.  Lets use the following scenario to illustrate the problem: Victim V is transacting with privileged P. P has access outside the Net Neutrality Firewall, while V does not. P creates a fraudulent blockchain that V is required to use for verification until it is no longer in P’s interest to maintain the fraudulent blockchain.  If and when V gains access outside the Net Neutrality Firewall, and joins the honest blockchain, they find their transactions invalidated.

V must either pay, what amounts to a transaction fee, to verify the transactions outside the Net Neutrality Firewall, or trust P has not created a fraudulently blockchain. This re-introduces not only the double-spend problem, but the trusted central authority problem.

Ultimately the revoking of net neutrality rules could be paving the way for the use of third party trust.

 

This is ultimately an attack against the peer-to-peer economy. Borrowing political parallels from the US, this is government attempting to legislate third party trust, is ultimately rent seeking and a form of financial slavery for those behind the net neutrality firewall. It enshrines the need for third party trust.

“Transactions that are computationally impractical to revise” will become easily fungible and most likely controlled by the ISPs that implement the net neutrality firewall. Buyers and sellers will no longer be protected against fraud, and reliance on a blackmarket type escrow system will become necessary for those trapped behind the firewall.

The “double-spending problem” that a peer-to-peer distributed timestamp or blockchain provides, will be interfered with by ISPs with poisonous intent.

Sources:

Bitcoin: A Peer-to-Peer Electronic Cash System – Bitcoin.org