Will IPFS storage be stopped by the government? Content risks may be borne by miners

Special note: This article only discusses ipfs, not filecoin, etc. The author is Huo Xiaolu

IPFS/Filecoin testing is in full swing, and more and more people are beginning to worry about IPFS compliance issues . Will decentralized storage conflict with domestic network supervision and data security policies and be cut short?

Huo Xiaolu believes that there is no need to worry too much in the short term . The project is too young and there are many uncertainties in its future development. It will take time to ferment. Regulators will not intervene too early. Bitcoin was launched in 2008, and regulators paid attention to it for the first time in 2013. The 94 document that shocked the industry was not released until 2017, a gap of nearly 10 years.

Regarding decentralized distributed storage, if you want to achieve long-term and large-scale development, some issues need to be considered as soon as possible. This article only discusses legal compliance issues from the perspective of miners based on existing official news and related tests.

To discuss the legal compliance risks of IPFS, we must first understand the legal risks of traditional cloud storage.

In traditional cloud storage, that is, centralized cloud storage, the risks are generally borne by the cloud storage service provider, that is, the platform.

Apart from the necessary procedures such as routine license applications, the two most common risks are data compliance risk and infringement risk.

Data compliance risks are currently more about the protection of personal information, involving compliance requirements in multiple links such as data collection, use, storage, flow, deletion, and cross-border transactions. The core is to avoid unnecessary collection and leakage, while data outbound, that is, the cross-border flow of data, needs to meet higher requirements.

Infringement risk mainly refers to what reasonable measures the platform should take to avoid liability when the stored content is suspected of infringing on the intellectual property rights of others. Generally, the "notice-deletion" rule is followed, that is, when the platform receives a user's infringement notice, it must promptly take necessary measures such as deletion, blocking, and disconnection. If the dereliction of duty leads to the expansion of damages, it must bear joint and several liability for the expanded part. However, the above rules do not apply to Iaas service providers such as Alibaba Cloud. It is mainly based on the comprehensive judgment of the specific service nature, service content, and whether there are derivative technical services of the service provider. It is legally complicated and will not be expanded here.

Looking at the IPFS white paper and removing all the modifiers and features, the core is still cloud storage, but it adopts a distributed approach, that is, the provider of specific storage services is replaced by individuals instead of platforms.

This raises two questions.

First, does the free storage of information mean that there is no need to meet regulatory requirements?

Obviously not. Everything can only develop in a long-term and orderly manner under the requirements of compliance. Everyone understands this principle and there is no need to explain it.

Since it needs to operate under the regulatory framework, why does the article say that there is no need to worry about possible regulatory conflicts for the time being? This is a question of "short-term" vs. "long-term". In reality, supervision cannot penetrate into all aspects in practice. Even mature industries are bound to have gaps and lags, not to mention those that have not yet become established in the short term.

Second, does distributed storage mean that platform responsibility is transferred to individuals?

To some extent, yes. According to the existing information and the operation of the test network, whether it is storage or retrieval, miners are paid services. In this process, the platform does not match transactions, and everything is communicated by users and miners. Since it is a paid service, it is not subject to excessive interference from the platform and has strong autonomy. So while enjoying the benefits, it naturally also bears certain responsibilities.

Given that the project is subject to uncertainty and is still in the testing phase, we can only analyze the underlying risks in a general manner.

For most miners, the worry should be whether the entire project will be stopped by the government halfway through the mining, and their investment and efforts will be wasted. There is no need to worry too much about this in the short term. Technology is neutral, and the entire project can be understood as a paid storage business. FIL coins can be regarded as similar to game tokens for storage and retrieval. The pure internal circulation mode operation is unlikely to be suddenly stopped as long as it is not used for a large number of illegal and criminal matters and does not involve the exchange of RMB virtual currency.

Returning to legal risks, for a storage system, the most critical issue is still “ content risk ”.

There is no problem with storing normal legal content. However, if it is illegal or sensitive content, the risk factor rises sharply .

Sensitive content is mainly concentrated in two categories: personal information + business secrets; illegal content involves two layers. The first layer is illegal content, such as pornography, violence, terrorism and other content expressly prohibited by law; the second layer is potential illegal content, such as content that infringes on others' copyrights and other related intellectual property rights.

Whether it is the officially announced fragmented encrypted storage or the entire storage of the test network, the risks for miners are basically concentrated on three things: storage, transmission, and custody .

For example, when storing, did the data provider know or have reasonable basis to judge that the content was illegal? Another example is, when knowing that the content involved privacy or bad content, did the data provider actively spread it? Another example is, did the data provider fail to fulfill reasonable obligations during the storage process, resulting in data loss or leakage? These are all possible risks, and different situations trigger different responsibilities, which need to be analyzed in combination with the business environment.

This is a question that has always troubled Huo Xiaolu, an outsider.

As a storage system, what are the fields where IPFS will eventually be applied? Can it attract enough real storage users simply by relying on the belief of "decentralization"? What is the core reason why users abandon existing cloud storage brand service providers and choose IPFS?

If we cannot answer the above questions in a practical and down-to-earth manner, it is really too early to talk about supervision and compliance.

The official Space Race 2 is mainly aimed at storage users and developers. After basic user identity review, users are expected to bring real, valuable and usable data, including but not limited to application data or data collection. Only by collecting more high-quality and valuable data can the project be revitalized and the value of the project be improved .

Imagine that after the birth of Bitcoin, as a kind of virtual currency, as long as it does not threaten the status of sovereign currencies, compliance may not be a problem. The compromise of Libra2.0 is a good example. Why is it that the price of the currency remains high and the speculators are all over the country, but it is still not regulated? The answer is probably the "money laundering" problem that almost everyone knows tacitly.

When a project, even a gold medal project like IPFS, is filled with a lot of junk, invalid and illegal content and is frequently used for illegal and criminal activities, it is difficult not to be stopped . The Internet Finance is an example, and the only outcome is a bleak exit.

Where will IPFS go? Only the project itself and its participants can give the final answer.

Regarding the legal risks of Filecoin mining, please go to " Virtual Currency || A detailed account of the mining machine situation and cloud computing risks behind Filecoin ".