Decentralized Internet: From Sitcom to Reality

By falconite | Blockchain BakBak | 26 Mar 2020

Viewers of popular HBO sitcom Silicon Valley would already be familiar with the idea of Decentralized Internet. Termed as the ‘new Internet’ in the series, the lead characters conceive a decentralized peer-to-peer (P2P) network built using smartphones. They even create their own coin and launch an ICO.


A scene from Silicon Valley

There have been instances where artists have first demonstrated a ground-breaking idea, and engineers have gone on to implement it. For example, the famed invisibility cloak from Harry Potter, or the hoverboard from Back to the Future. In case of Decentralized Internet, it was the other way around. The idea had already gained significant momentum in the world of blockchain before Silicon Valley brought it to the masses. In fact, co-founders of decentralized Internet project Blockstack even served as advisors for its 5th season.

What’s Wrong with the Internet Today?

The major argument against the Internet today is the privacy and security issue associated with our data. Websites like Facebook, Google and Amazon monetize user data, often without our permission, and almost always without sharing any of the profit. The recent Cambridge Analytica data scandal, is a shining example of just how dangerous a weapon our public data can be.

As the popular saying goes, “If You’re Not Paying, You’re The Product”

Centralized data storage systems are also prone to data theft. Advanced hacking technologies have increased the incidents of data breaches. News reports about personal data being hacked or leaked (such as this Instagram leak) have become quite regular now.   

Internet censorship is another contentious issue. All over the world, governments and authorities are using it as a tool to conceal information from citizens on political or religious grounds. Almost every nation today uses some form of internet censorship. Internet-based service providers (like  Netflix) are also resorting to what is known as geo-blocking, to curtail the content that users can access based on their geographic location.

The 3rd major issue is more technical than ethical. The current phase of the World Wide Web is referred to as Web2.0. This will soon give way to Web3.0; some believe that the transition has already started. While Web2.0 focused on the interaction of users with other applications, Web3.0 would be more intelligent, data-driven, and integrate with futuristic technologies like natural language search, artificial intelligence, and machine learning.

Unfortunately, the current TCP/IP protocol stack, which is the backbone of the Internet, is ill-equipped to deal with the enhanced security, privacy and performance that Web3.0 applications would require. The advent of Web3.0 would necessitate either a completely new Internet protocol, or an entirely different network altogether.  

Blockchaining the Internet?

Blockchain technology can be the foundation for laying the building blocks of the new decentralized Internet. Any blockchain network is essentially a decentralized P2P network of nodes, without any central authority overseeing or validating network transactions. Even if a few nodes malfunction, the network can keep on functioning as if nothing happened. This is in stark contrast to centralized networks, where a server crash can bring down the entire system.

Censorship resistance in an inherent feature of blockchain technology, strengthening the case for decentralized VPN. It can be argued that centralized VPN apps also serve the same purpose. Unfortunately, these 3rd party VPN apps have been known to log user data and monetize it. They are vulnerable to data hacks too, as this NordVPN data breach shows. And if all security checkpoints are covered, there’s always the problem of network sluggishness.

Blockchain projects have been working towards implementing a decentralized Internet for a few years now. Many of the public blockchain networks today (such as Bitcoin and Ethereum) suffer from scalability issues. These projects have not only been looking at creating a new decentralized architecture, but have also been working towards improving the speed, stability and security of the blockchain itself, so that it can reliably support Web3.0 DApps. In the following section, we look at some of these current and upcoming projects.



Whitepaper – read here

Substratum is an open-source network built on the Ethereum blockchain, where anyone can allocate their spare computing resources to host or access Web content through Substratum nodes. Substratum was possibly the first blockchain project working in this space to have conducted ICO, (in Sept, 2017) where they raised $13.8 million.

Nodes have to first download the Substratum Host software, which controls and encrypts traffic that originates or is routed through the node. As per Substratum, the software makes the traffic undetectable. Nodes within a certain geographical area are grouped together to form a Neighborhood. Each Neighborhood is responsible for keeping track of other network nodes, and storing information about them. This information exchange and tracking occurs using the Gossip protocol.

Messages originating from a node are relayed from neighbor to neighbour till the request is finally serviced. The message is encrypted only for the target node that receives it. This is true for the return route as well – each node can see only what is intended for it. Only the final node (which is the originator of the request) can decrypt the final message and see the complete content.

The Substratum ecosystem pays each Substratum node using the native token Substrate (SUB), which is an ERC-20 token. This is meant to incentivize people to allocate their computing resources towards the functioning of the Substratum network. Individuals can pay nodes using SUB tokens to host their websites too. Substratum’s team has also developed an online wallet called CryptoPay, to allow users to store major cryptocurrencies and pay through them.

Substratum was one of the pioneers in the world of decentralized Internet. Unfortunately, even 2 years after their token listing, the project hasn’t made any significant progress. The scalability issues that have shown up in Ethereum over the last couple of years haven’t helped Substratum’s cause either.

In Dec, 2018, Substratum’s CEO claimed in a video that they have been liquidating their ICO funds, which went against what had been promised in their whitepaper. To make it worse, Substratum launched a second ICO (for an exchange called Amplify). This coincided with suspicious activity regarding Substratum’s wallets and token trading on Binance, which eventually led to the delisting of their token.



Whitepaper – read here

Blockstack is a decentralized computing and application platform that promises to puts users in control of their data and identity. They were in the limelight recently for conducting the first SEC-approved token sale in Sept, 2019. Before this, Blockstack had also held private funding rounds, and the total funding amount is a staggering $75 million (as per Binance’s report).

Blockstack claims to provide a full-stack decentralized alternative to traditional cloud computing for building secure and private applications. Blockstack is re-designing the application layer of the traditional TCP/IP protocol, to remove points of centralization and provide a new network protocol for DApps. The existing transport layer and the underlying communication protocols are not being modified.

Blockstack has implemented its own blockchain Stacks, which provides the global consensus and coordination layer for the network. Users can register and control digital assets (like universal usernames and software licenses), and register or execute smart contracts on their platform. For any transaction, they have to pay network fees through the ecosystem’s native token Stacks (STX). Users can also link their access credentials for private data lockers with their universal usernames and have complete control over their data.

For the leader election process, Stacks uses a proprietary Tunable Proofs mechanism, which takes multiple inputs and adapts their relative weights. To begin with, the consensus algorithm is a combination of conventional Proof-of-Work (PoW) and a unique Proof-of-Burn technique, where miners burn cryptocurrency to indicate their interest in mining. Tunable Proofs gives Blockstack’s team the flexibility to research other PoW and PoS (Proof-of-Stake) mechanisms, and introduce them later in a tunable fashion.

Other innovations include a smart contract language called Clarity, and a decentralized data storage system called Gaia. Clarity is optimized for security and predictability of smart contracts, while Gaia enables users connect their private data lockers securely to their Blockstack client software. Gaia provides users the flexibility to host their data on cloud services, local disks, or even remote storage locations.

Blockstack’s team has been operational from 2013, and includes computer scientists from Princeton, Stanford and MIT. They claim that over 100 developer teams have built more than 270 apps on their platform. They have recently deployed the initial version of their full-stack computing platform. In order to attract DApps developers, Blockstack is currently paying $200,000 every month to the best apps built on the ecosystem.



Whitepaper – read here

Tachyon is creating a decentralized Internet protocol to provide a secure, reliable and fast network to users. Tachyon’s primary use case is decentralized VPN, but they are also targeting other emerging sectors like Internet-of-Things (IoT), Decentralized Finance (DeFI) and decentralized storage. Unlike other decentralized Internet projects, Tachyon hasn’t conducted any public token sale.

Tachyon is completely re-structuring the TCP/IP protocol stack. While Blockstack’s approach is restricted to the application layer, Tachyon is modifying the internet and transport layers too. Tachyon’s application is based on V SYSTEMS’ blockchain platform, which uses a novel consensus mechanism called Supernode Proof-of-Stake (SPoS). It’s similar to conventional PoS, except that SPoS only allows Supernodes with higher memory, bandwidth and processing capabilities to participate in consensus.

The core of Tachyon’s architecture is the Tachyon Booster UDP (TBU), which replaces the TCP/IP stack. TBU uses a combination of distributed technologies (such as PPPoIP, DHT and UDP) and cryptographic encryption. As per Tachyon, coupled with real-time Optimal Routing, TBU can improve transmission speed by upto 10x, and achieve over 90% connection success rate in complex network environments.

Tachyon Security Protocol (TSP) covers the security aspect. TSP uses AES to encrypt the connection, and a collection of hash algorithms (HMAC, SHA2 and Keccak) to ensure that messages are discarded if the communication channel gets disrupted. TSP also simulates the feature state of the communication protocol (UDP, TCP, HTTP/S, FTP or SMTP) to conceal the transmitted information and restrict firewalls’ ability to detect the traffic.

Apart from this, Tachyon uses Tachyon Anti-Analysis (TAA) to break down the data into multiple packets, and transmit them through different channels. If a channel is intercepted, only a portion of the message can be retrieved by the hacker.

Tachyon also plans to open a P2P marketplace where nodes can sell or purchase computing resources and bandwidth. Tachyon’s utility token IPX will serve as the ecosystem’s currency. Nodes can also stake IPX (like any PoS based blockchain system) and enjoy the associated privileges.

Tachyon is backed by V SYSTEMS and X-VPN, who are also their main investors. X-VPN is a centralized VPN application with over 50 million users worldwide. Tachyon’s team is hopeful that the association will help in creating a global market for their decentralized VPN. As per their roadmap, IPX will be listed on exchanges by the end of 2019, to be followed by the release of their VPN’s alpha version in Q1 of 2020.



Whitepaper – read here

Orchid is also developing an open-source decentralized VPN application. Till date, Orchid has raised $48 million from private investors, and will refrain from conducting a public token sale. Orchid’s VPN application is set to be launched by the end of 2019.

In terms of idea, Orchid is similar to Substratum. Service providers run Orchid software, which is similar to a typical VPN daemon. Orchid servers maintain registration information in a stake registry and provider directory. The stake registry enables the Orchid client to discover random servers for users, while the provider directory allows server nodes to register metadata (such as geolocation and services offered).

Users are incentivized to share bandwidth through a peer-to-peer decentralized Orchid Market. Customers pay for bandwidth by using Orchid’s utility token OXT. Like Substratum, Orchid also uses the Ethereum blockchain, and OXT is an ERC-20 token. Anyone who wants to operate an Orchid Node has to first stake OXT to the network.

Orchid protocol uses the open source communication protocol WebRTC, which is a web standard widely used for the transmission of audio/video from inside browsers. WebRTC provides some amount of data obfuscation, which makes Orchid traffic look like normal internet traffic and avoid firewalls from detecting the VPN. In order to mask the original node which generated the request, multi-hop techniques are employed.

Orchid also implements a unique nanopayment system, which is the foundation of the Orchid Market. Payments in the bandwidth market are expected on a packet-wise basis at an exceptionally high rate. However, Ethereum’s layer 1 solution is extremely slow and costly to settle these frequent nano-transactions, while layer 2 scaling solutions are not completely reliable or secure.

Orchid uses an advanced payment architecture where users send probabilistic nanopayments, balancing transaction fees across multiple transactions and parties. This system is similar to one where clients pay node operators OXT lottery tickets for proxy bandwidth. Orchid claims that the nanopayment system could potentially scale to billions of transactions per second (TPS) using sharding with Ethereum 2.0.

Inspite of these optimizations, the Ethereum blockchain remains Orchid’s primary weakness. As they have admitted in their whitepaper, any scaling and security issue inherent to Ethereum will adversely affect Orchid’s performance too. Considering Ethereum’s current speed of ~15 TPS, Orchid’s system can only scale to millions of users today. Scaling to tens of millions of users will be possible only when scaling improvements occur in Ethereum itself.

Parting Thoughts

While all the projects discussed here are working in the decentralized Internet and VPN sector, their visions are different. Blockstack is developing a decentralized computing environment, where developers can build secure and scalable DApps, while Tachyon is deploying a completely new decentralized network protocol, which can support VPN, IoT and DeFi applications. There are a bunch of other projects with different working philosophies. For example, Blockcloud is designing a blockchain-based massively scalable advanced TCP/IP protocol stack, aimed specifically at the IoT market. While it is extremely difficult to pick a winner so early in the game, it can be safe to say that more the competition, greater the overall development of the ecosystem.

P.S. - This article was originally published on HackerNoon. You can reach out to the author on Telegram or Twitter.   

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