Utilizing blockchain's decentralized architecture, smart contracts and cryptocurrency applications, an emerging ecosystem of startups is now offering to pay companies and consumers for their computers' unused storage capacity and network bandwidth.
The companies, which use blockchain's peer-to-peer (P2P) architecture to deploy software to disparate computers or servers, then offer services through aggregated resources — from data storage for distributed application development to cybersecurity.
Washington-based Gladius says it has even figured out how to end distributed denial-of-service (DDoS) attacks using excess internet bandwidth from corporations and individuals during down time. This month, it launched its LegionP2P software, which aggregates unused network bandwidth and makes it instantly available to any participating company to fend off inbound DDoS attacks.
It also allows Gladius to distribute content over the P2P network, which is where the company's CEO, 20-year-old Max Niebylski, sees the most promise.
The goal, Niebylski said, "is to become the largest content delivery network in the world without actually owning a single piece of hardware."
Palo Alto, Calif.-based Filecoin and Atlanta-based Storj Labs are using blockchain to manage a storage aggregator that rewards those who rent out unused storage with cryptocurrency or with free storage and network capacity.
Storj Labs/Google Maps
A map showing where Storj farmers and their nodes are located around the world.
"This is blockchain at its best, frankly — peer-to-peer networks where underutilized servers are traded," said Avivah Litan, a Gartner vice president of research. "It's more or less Uber for computers on a blockchain, so by default the design eliminates the Uber-like central authority and operator and replaces it with smart contracts in a system where no one entity is in control."
Joel McIntyre, founder and CEO of high-speed internet service provider GiGstreem, said his company has been beta testing Gladius' DDoS prevention service. And while the security aspects intrigue him, its blockchain's ability to aggregate bandwidth for content delivery that represents a greater business opportunity.
"That's where we really got excited," McIntyre said.
GiGstreem aims to provide last mile broadband connectivity via fiber optics and wireless routers for businesses and dense urban, multi-family housing communities. GiGstreem's business could offer something as simple as an internet handoff for a business that just wants to get online or provide large corporations proprietary VPN tunnels between multiple offices.
Currently, GiGstreem is able to offer Gladius between 10 gigabits and 20 gigabits of bandwidth to help fight DDoS attacks. But as GiGstreem ramps up its participation, McIntyre believes his company will be able to use client-side routers and switches to offer hundreds of gigabits of aggregated bandwidth on a daily basis.
Aggregating bandwidth that way also means GiGstreem can also use the bandwidth to distribute content closer to the customer without relying on media service providers such as Netflix, Google or Facebook.
"If we have that data distributed across our network, you never have to go outside our network — you know, out to the cloud — to get access to that content; it's inherent to our network and therefore the speed and capacity capability of the service becomes exponentially better," McIntyre said.
A distributed bandwidth model also allows GiGstreem to find new ways to compensate customers who agree to view advertising for a price reduction or free content.
"It shouldn't just be 100% in the hands of the upstream ad companies, the Googles and Facebooks of the world that drive the content at you. You should have some control over it; you should get some compensation from it," McIntyre said. "We think there's an opportunity there inherent with Gladius' core technology and architecture that will allow us to do that."
McIntyre believes distributed ledger technology will allow companies to disrupt the traditional advertising model by garnering a mass audience via the blockchain content delivery service, thereby allowing GiGstreem to barter with advertisers for some rights and controls.
"Using that blockchain methodology..., we can turn that transaction on its head to where our customers can say, 'This is the type of information I'm willing to consume, the type of ads I'm willing to consume,' in exchange for a [crypto] token or a reduction in their monthly bandwidth bill," McIntyre said. "We're still toying with that model, but ultimately [this is] where we see this going and are so excited about the partnership with Gladius."
How LegionP2P works
Gladius' LegionP2P software allows Gladius to leverage massive scale and speed capabilities critical to stopping DDoS attacks by squeezing the maximum performance out of any hardware on which it is running.
Gladius has a P2P architecture overlay on top of the Ethereum blockchain platform, so transactions are done on Ethereum while all of the website requests are handled by the overlay.
Essentially, customers offering up bandwidth to the pool redirect their domain name service to Gladius' P2P network.
"At a high level, service providers want to provide protection to their clients... or pools of resources to them in case of a DDoS attack," Niebylski said. "In these pools, you have the pool owner who runs the master node that is essentially a source of truth that continually pulls website content and distributes that throughout the pool to the nodes."
Gladius software is comprised of three highly complementary technologies: a content delivery network (CDN), a web-application firewall and a DDoS mitigation service.
"Not everyone has the resources to deploy a CDN," Niebylski said. "Gladius makes it easy for ISPs, like GiGstreem, to deploy CDN technology. This technology enables GiGstreem customers to access cacheable content on GiGstreem’s network without having to traverse outside to other carriers. CDNs reduce load times and transit times for consumers of content, ranging from static website data [and] frameworks [to] video.
"GiGstreem would benefit from the use of this technology because they are the last hop to the customer," he said.
Gladius uses two types of nodes, a content node and a proxy node. The content node takes the data from a master node and stores it on the computers, whether it be a data center computer or a home computer. A proxy node doesn't store data but acts as a filter to analyze incoming traffic.
"Then when somebody wants to visit the site, they type in the URL and they're directed to the master node, which points them to the content node that's geographically closest to them," Niebylski said. "So, instead of having to grab all these files and videos from a server across the ocean, potentially, you could be grabbing all the content from your next-door neighbor ... or even your own computer if you were storing content in there."
The computers basically act as content caches and as traffic analyzers to see if certain IP addresses requesting access to a site is either a normal visitor or a compromised component of a botnet.
Gladius' LegionP2P software is currently in open beta with the expectation it will be generally available in April. It's currently aggregating network bandwidth from about 1,600 nodes in 80 countries.
Investors are interested, but there are growing pains
Investors are taking blockchain-based aggregation services seriously, but some companies have run into speed bumps.
In 2017, Filecoin's initial coin offering (ICO) became the largest token sale in history, garnering more than $257 million — and the company received money from top venture capital firms such as Andreessen Horowitz, Naval Ravikant, Y Combinator and Winklevoss Capital.
Data storage aggregator Storj Labs did its own ICO in 2014, and had a group of VC investors in 2017 that included Qualcomm Ventures and Techstars. Despite the enthusiasm for its plans, Storj ran into problems scaling; in March 2018, it stopped accepting new users until it could rearchitect its platform to allow it to grow with demand.
Last fall, Storj announced that its updated V3 platform had entered a public alpha phase for developers and companies interested in testing the platform on their local hardware, and so it reopened to new customers. Last month, it welcomed new node operators, who supply the storage capacity to the P2P network.
"We've been onboarding our storage node operator waitlist and are set to launch the next phase of our alpha the first part of April," said Storj spokesperson Dan Sorensen. "This next release, Vanguard, will welcome partners and developers to the platform, allowing them to test their integrations ahead of the beta and production launches. We expect to enter beta this summer, a few months after April's launch. Production launch will be this fall."
Preliminary tests have shown Storj Labs' service is about 20% faster than Amazon S3's storage service, while also being about half the price, Sorensen said. The platform is also S3 compatible to simplify migrations.
Storj also recently announced an open partnership program with an initial 10 companies that have signed on, including Confluent, Couchbase, FileZilla, InfluxData, MariaDB, Minio, MongoDBNextcloud, Pydio and Zenko.
Storj Labs uses blockchain to track digital "farmers" who, similar to Bitcoin miners, have signed on to allow an application to share excess network and storage capacity on their computers or servers. The blockchain ledger is also used to pay farmers in cryptocurrency.
Free, open-source FTP client FileZilla, which has been piloting the Storj decentralized storage for nearly a year, had been making money through its free file-sharing service, which is hosted on SourceForge.net. (It pitches users third-party software or offers to let them make money by testing a new web or mobile application. In turn, FileZilla shares revenue with the third-party software vendors.)
By sharing revenue with Storj Labs, FileZilla would be able to continue offering users its free service and even expand feature sets — such as offering free access to a VPN — using the native cryptography of blockchain.
"People have been using FileZilla for free for so many years, it's important to find a new service that, if it's not free, it's cheaper than anyone else," Roberto Galoppini, FileZilla's director of strategy, said in an earlier interview.
Prior to signing on to test Storj, FileZilla's leadership had been hunting for another storage method based on a secure cloud service; a token technology was key because it created a certain "stickiness" for users.
"For the first time, we're able to provide end users with something that's easy, and cheap — if not free — and that they're able to make money with," Galoppini said. "It's not a zero-sum game. Everyone wins."
Another startup, 0chain, also uses blockchain to tap into unused storage capacity to be used by dApps (decentralized applications that run on P2P networks); the difference is that 0chain's algorithm only uses enterprise data center servers to create a virtual pool of capacity. In turn, the company markets the spare capacity to other enterprises. 0chain also claims companies that use its decentralized cloud storage will suffer less latency than other offerings.
0chain has partnered with dApps providers such as China-based NEO Council to design blockchains for specific use cases and verticals, such as internet-of-things (IoT) devices, retail and financial services.
"The idea is that an IoT app...should be configured differently than one that handles retail transactions, for example. So, this approach may put 0chain in the best position to become a viable alternative to AWS," a 0chain spokesperson said via email.
0chain claims that, because its architecture is decentralized (unlike AWS), it is less vulnerable to concerted hacker attacks.
Sia pushes a blockchain-managed P2P storage network
Boston-based Sia also uses a blockchain-managed P2P network to store data on hosts with excess storage capacity; it replicates each file to 50 other hosts for redundancy and reliability.
Sia is running more than 1,000 hosts in 50 countries, and while its beginnings may have been with consumer users, it now targets the enterprise market, offering cold storage to CIOs and CTOs at enterprises, universities and SMBs. It claims its service is 10 times more affordable, more secure and more reliable than traditional cloud services.
Conceived in 2013 at an MIT hackathon by then 20-year-old David Vorick, Sia can offer cheaper storage prices because it's not exclusively using data centers like other cloud services. So there are no capital expenses to build the data centers.
While Sia hosts set the price for their capacity use, on average it costs $2 per month per terabyte, according to a company spokesperson; that compares to AWS, which charges $20 per terabyte per month for archival data storage. For enterprise capacities of 100TB, AWS, Google Cloud and Microsoft Azure all charge $2,000 a month or more; Sia charges $200 a month for the same storage.
The idea of using P2P networks to aggregate computer resources is not new. In the early 2000s, BitTorrent opened as a distributed file-sharing service and grew to handle more than half of the internet's file-sharing bandwidth.
Because blockchains come with a built-in mechanism for payments — cryptocurrencies, which were missing from the last go-around at P2P services — they are more likely to succeed, analysts and users said.
"Tokens are game changing," FileZilla's Galoppini said. "It can finally bring us closer to avoid that one-on-one relationship with the end user that comes to us, downloads our software and goes away. In this case, they become part of an ecosystem. If they start using the storage, and start sharing their hard drive capacity or bandwidth, they become part of a marketplace."