News

Market-Efficient P2P File-Sharing: The BitTorrent Token

Published

on

p2p-bittorrent-token

Peer-to-peer networks existed well before Bitcoin. The most prominent, BitTorrent, is a P2P network aimed at enabling a decentralized file system.

The P2P file-sharing protocol is a widely used method for distributing content such as audio, video and software. Distributing files over BitTorrent reduces infrastructural costs significantly. Enterprises such as the gaming company Blizzard Entertainment use the BitTorrent network to distribute game installers and patches for World of Warcraft and Starcraft. Facebook and Twitter use the protocol to distribute software updates to their servers. In some instances, the protocol is used for sharing copyrighted works.

The BitTorrent network has always suffered from leeches or free-riders, that is, peers that download more than they give back to the network. The protocol can tolerate a certain amount of leeches, but if a significant fraction of the network chooses a free-riding strategy, the system collapses. The economics of P2P file-sharing protocols have been of particular interest to academic research, specifically game-theorists. Economic mechanisms have been integrated into the BitTorrent protocol to disincentivize free-riding peers in P2P networks. Still, after extensive academic research, clients have emerged that use strategies to gain advantage over the reference BitTorrent client. For example, modified clients can maximize peer interest in exchanging pieces for as long as possible from others by revealing missing pieces strategically over time.

With BitTorrent’s newest project, the BitTorrent Token (BTT), we expect leeches to fade into obscurity. Using their new cryptographic utility-token, BitTorrent adds strong economic incentives to facilitate fair and market-efficient file-sharing inside the network. Peers participating in the BitTorrent protocol have to make decisions about which neighboring peer to send data to. BitTorrent plans on integrating an auction mechanism during this step. Neighboring peers bid on how much they are willing to pay to receive certain data blocks. Rational peers would transact with the highest paying individuals. Doing so, the BitTorrent protocol transitions towards a market-efficient network where peers are fairly rewarded for transacting and providing resources to those who want them the most.

Figure 1: Auctioning peer slots in a P2P network using a uniform price auction. BitTorrent Token Whitepaper.

Figure 1 depicts a possible auction format implementation. The peer providing services is auctioning off 5 slots. Peers who request to exchange data with the service provider express their willingness to pay for a slot. The 5 highest bidders are given a slot and pay the highest losing bid, that is the 6th highest bid. This is called a uniform price auction. Such an auction is expected to produce optimum results.

The BitTorrent Token is a TRC-10 based utility-token issued on the TRON blockchain. BitTorrent was acquired by TRON in Summer 2018, which explains why BitTorrent chose to build on TRON. The exchange of BTT between network peers must be handled off-chain using technologies similar to those utilized in the Lightning Network, as current on-chain solutions cannot support the required transactional throughput and sub-second confirmation times.

Bibliography and Related Work:

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Trending