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BitTorrent’s master plan to bring a Tron-powered crypto token to the masses

This weekend, Binance founder Changpeng praised Zhao Tron on Twitter for adding a crypto-based business model to BitTorrent, the branch sharing software he bought last summer.

Zhao, who topped CoinDesk’s Most Influential List in 2018, wrote:

“Dapp’s grandfather[s] finally finds its decentralized currency and its business model. Should be a very interesting case study. “

Zhao’s tweet delivered over 100 retweets and over 500 likes and a decent series of comments that followed what he had to say. Many respondents seemed to conclude that Tron would make BitTorrent a paid service. Instead, users have the option to spend crypto – more specifically, the new BitTorrent Token (BTT) – to enhance their user experience.

According to a review by CoinDesk, the BTT whitepaper (PDF) promises a wide universe of possibilities. “By introducing a mechanism for storing and exchanging values, we want to significantly expand the universe of possible participants – either service requesters, service providers, or both,” the document says.

Regarding the question of whether BitTorrent would switch to a paid model, the whitepaper addresses this directly: “Participation in the BTT transactions must be both fully disclosed and optional for end users.”

The more substantive reviews of the move generally argued that BitTorrent was nothing more than a decentralized exchange for pirated content. However, the BTT whitepaper argues that the protocol could find more use with a token:

“Optimizing the existing BitTorrent protocol is an obvious first step in introducing a cryptographic token, but it barely scratches the surface of what will quickly become possible.”

The companies behind BTT – Tron and the BitTorrent Foundation – envision three core businesses that could potentially be decentralized via BitTorrent if a value tool were built in: content delivery, file storage, and privacy proxy services.

While the list is not exhaustive, it hits many of the same categories that the Telegram Open Network listed for itself. Additionally, blockchain engineer and Bloomberg writer Elaine Ou has blogged about previous attempts to token bandwidth and data storage (spoiler warning: they didn’t work in the past).

Regardless, these new BitTorrent activities are still encountering the initial friction from existing BitTorrent users: they have gotten very used to the protocol that provides its services for free.

However, the whitepaper is very extensive to explain that it is not really free. It claims:

“The system essentially implements a barter economy in which individual customers collaborate based on the trade in parts of a file they each wish to download, using delivery bandwidth as a key factor in further bartering.”

Bit torrent economy civilization

With the BTT white paper, the company wants to make it clear: BitTorrent users have always paid for their downloads – they pay with bandwidth.

It was a barter economy. Just like with the human economy, the idea is that by adding a fungible token to this barter system, the economy can expand for the benefit of everyone involved.

BitTorrent breaks files down into many parts. So the first piece that a user downloads is available to another user who wants the same file but has not yet downloaded that piece. This is called a “seed”.

However, it doesn’t always work fairly, as the whitepaper explains:

“Because of the bandwidth imbalance, file downloads often complete long before a peer has been able to upload an appropriate number of bytes.”

This means that some users can get a partially free ride. If too many users sharing and downloading the same file shut down their BitTorrent clients after the download completes, it can disrupt a swarm and create gaps in the user experience.

As the whitepaper points out, the bottom line is that the system still works quite well. People can get anything they want on BitTorrent in general because there are so many users.

Still, the company believes that adding a token could make it work just a little better and make the service even bigger.

Bigger picture

In either case, it appears a primary goal for Tron is to convert a huge user base of decentralized internet users into crypto users so that the adoption game can be won.

Ash Egan, who takes the lead on blockchain and crypto at Accomplice VC, told CoinDesk that he sees the acquisition as an offer from Tron for legitimacy.

“BitTorrent has been recognized and stress-tested for about 15 years,” said Egan. “What better way to legitimize yourself than to acquire that stature?”

This stature encompasses a large user base. BitTorrent, which was first introduced in 2001, states that 100 million people use the protocol every month. The whitepaper makes it clear that Tron and BitTorrent plan to leverage these users to get the users to use crypto:

“While many new proposals for decentralized protocols point to ambitious technical paths, almost all remain silent about how to address the enormous marketing challenge of building a critical mass, which is a critical technical necessity for all distributed systems.”

Read the full white paper below.

Crowdsurfing image via Shutterstock / Christian Bertrand

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