Bit by bit, we are achieving decentralization and in some cases, completely abandoning centralization. Widespread adoption is just out of reach, but in this technological age, we are making our way closer towards it. Similarly, we are gradually working our way closer to an Internet that operates in a peer-to-peer (P2P) fashion. However, for the time being, it is still an ambitious vision and nothing more.
Let’s be realistic. A totally P2P Internet is more of a hypothetical concept than anything else. The global system we are familiar with relies heavily on a number of centralized servers and platforms. What’s more, the blockchain protocol is what allows the capability of avoiding these intermediaries when sending digital currency. Alternatively, when sending any form of data. As a matter of fact, this is part of the reason why Bitcoin is the most popular cryptocurrency today.
Of course, digital currency is by no means the sole P2P blockchain application. Far from it, in fact. It is important to note that its design focuses primarily on disintermediation. Because of this, P2P developers are employing the use of blockchain technology to build software. The intent of this unique software concentrates on web decentralization.
P2P’s presence predates that of Bitcoin’s and the blockchain’s. Using this protocol as a way to restructure the internet is a new idea. However, there are already a number of tools that draw their foundation from this concept. These applications are what we will be going over in this article.
What is it?
Peer-to-peer computing (or networking) is a specific brand of distributed application architecture. Its purpose is to divide tasks or workloads between a group of peers.
‘Peers’ are entities with equal privilege and are equipotent participants in the application. A common interpretation of how they function is that they collectively form a peer-to-peer network of nodes. Peers make a portion of their resources directly available to other participants of the network. These resources include processing power, disk storage, and network bandwidth. They can make them available without any need for central coordination at the hands of servers or stable hosts.
Peers fill the role of both the suppliers and the consumers of resources. This is in stark contrast to the traditional client-server model. In that case, there is a divide in the consumption and supply of resources.
Up-and-coming collaborative P2P systems are going the extra mile and beyond peers doing similar things while sharing resources. What they are looking for are diverse peers that can provide unique resources and capabilities to a virtual community. In turn, they will effectively empower it to engage in greater tasks. That is to say, tasks that surpass those that individual peers can accomplish. At the same time, they are beneficial to all peers.
P2P software allows peers to be able to connect to each other over the Internet in order to share files. Some notable examples of mainstream P2P software programs include the following:
- Ares and AresWarez
- XYO Geomining
Peer-to-peer and blockchain
Many of us are already familiar with blockchain technology. For those who aren’t, the best way to explain it is it is a “chain” consisting of “blocks” of data. It is a decentralized, distributed ledger whose purpose is to record the origin of a digital asset.
Blockchain builds on the core idea of P2P networks, effectively providing a universal data set that everyone can trust. And this is regardless of the fact that they may not know, let alone trust, each other. It provides a mutual and trustworthy ledger that focuses on transactions. Here, immutable and encrypted copies of vital information are put into storage on every node within the network. Economic incentives taking on the form of native network tokens are put in place to make the network fault-tolerant. Moreover, it gives the network the ability to attack and be resistant to collusion.
Different types of applications
There are an array of P2P blockchain applications that are emerging over time. Different intents, different functions, each one of them with their pros and cons. Now that we understand P2P, we can start highlighting a handful of these applications. It is difficult – impossible, really – to tell if these tools will construct the basis of a new type of web. For all we know, they could do nothing more than filling a niche market. For the time being, they are still worth exploring.
There are three different types of applications that we will go over: file sharing, gaming, and exchange software.
1 – File sharing
Filecoin is a project from the same team that is responsible for IPFS (Inter-Planetary File System). It functions as a platform for storing data as well as its own eponymous cryptocurrency. One can earn Filecoin by way of hosting files. The mining software of the program permits users to exchange the storage space, not in use for the currency. In turn, you can exchange it for USD, Ether, Bitcoin, and various other currencies.
This is different from IPFS. That is a decentralized web application system that utilizes blockchain protocol as a means to archive and preserve digital files. The difference between it and Filecoin is that the latter is largely incentive-based. However, they do actually share several of the same benefits, including stability and censorship resistance.
Sia is another protocol that utilizes the power of blockchain technology to decentralize both data storage and transmission. Not unlike Filecoin, Sia boasts its own cryptocurrency – Siacoin – and with its software, it is possible to mine it. The “About” page on the Sia website wastes no time in making the project’s goals abundantly clear:
“Our long term goal is for Sia to become the backbone storage layer of the Internet.”
As is, the competition Sia faces is the current internet structure (i.e. Dropbox, Google Drive). In the near future, though, threats of the protocol’s potential may only be similar programs and that’s it.
2 – Gaming
For something that is more playful, we have Etheria. This platform is a video game that bears a striking resemblance to the popular game, Minecraft. It is based on the Ethereum blockchain and, according to them, is the “world’s first decentralized virtual world.” In Etheria, players own an array of tiles and “farm” them, so to speak, to obtain building blocks. In a way, this process is quite similar to the cryptocurrency mining procedure. As is the case with Minecraft, the core intent of Etheria is to build new things in the virtual world. However, it is possible that future versions will go on to include more gaming features.
Because its foundation draws from Ethereum, Etheria has a strong resistance against censorship and takedown. This resistance extends to any state, company, or individual, and that includes its developer. It requires more tech-savvy knowledge to set up than Minecraft does, which should come as no surprise. After all, as a P2P blockchain video game, it is breaking new ground. Along with other games (Beyond The Void and Spells of Genesis are two examples), it could potentially be part of the first generation of blockchain gaming.
3 – Exchange software
Bisq is an open-source application specifically for buying and selling BTC and various other cryptocurrencies. To use it, one must install the Bisq desktop client before connecting to Tor. The additional mandatory steps to trade on Bisq are in connection with its limited usage. On average, there are just 2-3 trades per day on the platform.
Bisq users begin with a trading limit of 0.01 BTC, though you can raise it once another peer signs your account. In practice, you will essentially encounter plenty of small sell orders on the site. If you are looking to liquidate large amounts of BTC, then Bisq really is unfortunately not the place for you. On Bisq, news.Bitcoin.com was able to sell BTC at an average of 7% under spot price. However, the order size was under a 0.08 BTC limit and there was a requirement of two trades.
Getting its name from the famous “I AM HODLING” bitcointalk post, Hodlhodl’s crowning achievement is organizing the Baltic Honeybadger conference. Beyond that, it also serves as an adequate P2P exchange. The best offer available that’s on the site is 3% under market price, which is not too shabby.
At LocalCryptos, people from all over the world can exchange their local currency for Ethereum. It is important to note, though, that the exchange does not support any other crypto. The site gives its users the ability to post ads. With them, they can establish exchange rates and payment methods specifically for buying/selling Ethereum. You are able to reply to these ads and agree to transact with the person you are replying to. With this platform, you can sell BTC or ETH at nothing more than 4% under spot price.