Trons BitTorrent Problem

In June of 2018, blockchain technology company Tron purchased the revolutionary file-sharing company BitTorrent for $120 million, beating out NEO’s $170 million bid. Now we know what the fruits of that acquisition are, with the recent announcement of the details of Project Atlas, a new token (BTT) that is meant to incentivize torrent seeders and allow people to pay for fast lanes for downloading. The airdrop of BTT tokens is being heavily hyped across crypto news and social media in advance of the release. BitTorrent founder Bram Cohen wants people to know that he is not in any way affiliated with this project. Bram left BitTorrent in April 2017 to work on his own cryptocurrency project called Chia, which I personally have a lot of hope for, but that is another story.

With that preamble, let’s dig into what the BitTorrent problem is for Tron. First, let’s just understand the torrent protocol is used about 98% for the illegal exchange of files, typically movies/TV, music and software. Unless you are going through a VPN, anyone that cares to look can get your IP address, your IP address leads to your ISP and in countries with copyright laws, your ISP will respond to various complaints, such as a DMCA complaint. The biggest problem that BitTorrent has had historically (aside from figuring out a good way to monetize it) is getting people to continue to seed files after they’ve downloaded, and that is what Tron feels they are addressing with Atlas.

Most people have used a torrent at one time or another, so BTT is going to give you the ability to pay for a fast lane. Now consider what you torrent and how long it takes to get most of that illegal material. Does it take long? If you are going to pirate the new Avengers movie from the camcorder recording an hour after the first showing ends, is a difference between 10 minutes and 2 hours a big deal? Is it worth paying for? Atlas is going to give you BTT tokens to start you out, but ideally you will earn tokens by seeding content, you could then use those tokens to pay for faster downloads, but in reality, not many people will do that. You will also at some point, be able to cash those BTT tokens out, but on average someone will be earning only ones of dollars a month for the seeding, so not a big financial incentive or even a bandwidth incentive. Here is where the trouble comes in.

If you are in a country with copyright laws that get enforced, then you are leaving up these files to be seeded, with your IP address easily visible, which means that the copyright owners can file complaints and that means you are exposing yourself to a much greater risk of being caught for stealing copywritten material. A neighbor of mine had his internet canceled for six months after downloading Game of Thrones one too many times, he had to switch to a new provider, so this really happens and over what may seem trivial violations. What will likely happen as this platform rolls out is that most of the seeding will shift to torrent seed boxes that are in countries without copyright protections, so the average joe isn’t going to be earning anything on this platform and even the seed boxes aren’t going to generate real money.

Now let’s just ignore the whole legal jeopardy thing for a minute, even though this is one of the biggest problems I see. Let’s assume that there is no legal jeopardy and everyone is happily stealing all this content. Does it occur to you that the content creators will stop? I ran a record label for 15 years, we shut down almost entirely because of the piracy problem, and it is even worse today. Most of the bands stopped making music because of the piracy problem. Project Atlas just seems like an enabling technology to encourage and assist in the theft of intellectual copyright. Eventually, you will feel the pain of it if you keep engaging in it, and getting busted isn’t a happy place to be, the max penalty is $150,000 per incident in the US and if enough people just start pirating everything, expect those lawsuits to get a lot more active than they are now. So, to those BitTorrent seeders out there that are looking forward to making money from this project, watch out.