Our fervent hope is that the Safe Network will be the one that finally gets it right. Plenty of promising decentralised projects have crashed and burned through underestimating the technical challenges, misaligned incentives, obsession with short-term coin prices, and a fatal dilution of the original vision. Our vision is as it always has been: secure access for everyone to humanity’s data. To have a chance of achieving it, we need to be canny, to deal with the world as it is, and to stay one step ahead.
The Safe Network Foundation, as most of you know, will be based in Switzerland, which is probably the most welcoming and forward-thinking country in the world as far as crypto-related projects are concerned. That said, there are rules and requirements. Fortunately, unlike in the UK, they are mostly logical, sensible and consistent. This week @Heather_Burns takes us through the non-token governance questions being asked of us by the authorities and how we’ve responded
@yogesh is working tracing messages sent by client to the elders and from there to the adults using traceroute, so we can get a complete picture of what happens on a GET or a PUT. He reckons he’s 80% there. He is also researching simple, ultra-lightweight key-value databases to replace sled db, which has a few issues and is apparently no longer maintained.
@anselme is tightening up the Handover process, adding a verification stage so we can check that the promoted elders match our network knowledge, and @davidrusu is debugging Membership where we’ve been experiencing deadlocks when propagating network knowledge. This seems to be fixed now and we should be able to integrate it into anti-entropy soon.
And @dirvine is digging into information dispersal algorithms (IDAs), as outlined last week, enabling data to be split up for transmission to greatly reduce overall traffic. He’s found a likely candidate with initial tests performing quite nicely. Next step is to do some benchmarking to check performance.
This month, as part of our ongoing steps to establish a healthy independent structure for the project’s non-token governance aspects, we had to answer a number of questions about the due diligence we are undertaking to prevent the Network from being misused and abused in ways that could damage its commercial potential as well as our own reputations.
Where any technical innovation is concerned, there are three issues which must be addressed by any legally binding governance structure, no matter what the nature of the project is or how it is funded.
We at MaidSafe are doing everything we can to ask the right questions on these issues. Because we know that other companies and projects are looking to us as an example, we’re also keen to “show our work” on the steps we’re taking, and look forward to sharing what we’ve learned as these innovations develop.
Until then, here are some of the questions we were asked about these three issues, along with abbreviated versions of our answers.
Q. How can the Safe Network prevent the abuse of the system for illegal financial activities?
A: Any system with privacy as a key principle will raise legal and regulatory concerns about individuals or organisations potentially misusing the system for criminal ends. Chief among those concerns when it comes to the economic misuse of the system is, of course, money laundering.
The Network is designed around the privacy and security of users’ data and communications. Private payments, therefore, are necessary to the extent that they protect the privacy and integrity of user data when being stored on the Network. The Network itself can function as a closed system where users trade local temporal storage and computing resources for perpetual distributed Network storage, in a private and secure environment.
Users will still, understandably, desire economic on and off-ramps in fiat currency for ease of access to Network services, and also get money back out of the system to cover hardware and utilities. It’s these entrance and exit points where the money laundering risks bottleneck, and can be addressed.
We are anticipating doing this through:
Accessing fiat ramps via exchanges or payment platforms which have established anti-money laundering procedures and safeguards;
Working towards decentralised solutions that allow individual users to protect their privacy, and maintain their own financial and personal security (for example, a system that allows controlled disclosure of personal financial information to 3rd parties, such as regulators, without the need for fully public ledgers); and
Giving platforms and exchanges the tools to meet their obligations.
It’s worth noting that anti-money laundering, and ‘Know Your Customer’ (AML/KYC) checks, which are required in most jurisdictions, can be quite invasive. Providers can expose regular law-abiding individuals to financial and personal security risks. While we don’t yet have all the solutions to answer this tension between compliance and individual privacy, thanks to the unique nature of our technology, we are in a position to be pioneering solutions to meet those needs.
Q. How can the Safe Network ensure that the funds coming into the network are clean? Who defines the “cleanness” of the funds? Are there different interpretations by country? If this is the case, what are the implications for the Network and its users?
A. The Safe Network is effectively an infrastructure layer which allows apps, platforms and services to be built on top. So the Network itself doesn’t have knowledge or control over the origin of funds entering the system—only the validity of the tokens within its system. That’s why, as mentioned above, the economic on- and off- ramps to that system, where currencies are traded for Safe Network Tokens, are the flash points for money laundering.
What we can do as a Foundation, is to build tools that allow platforms and payment providers bridging into the system to be able to run the required checks, and yet maintain individual privacy.
There are different requirements by jurisdiction, which payment platforms already adapt for. In fact, we can potentially further help here through the development of decentralised identity protocols.
They have the potential to lower the compliance burden for platforms, increase control and security for users, and be used in the context of international consensus. While there are differences between jurisdictions, there is also international cooperation on such matters, for example on rules regarding enforcement of international sanctions.
There are areas, such as this, where the Safe Network Foundation will need to do compliance and AML checks. For example, when we are paying out grants or royalties to application developers, these will need to be in accordance with ‘Know Your Business’ regulations, and Financial Action Task Force (FATF) Recommendations, of which Switzerland is at the forefront. This is one reason why we will need to establish specific developer programmes, which are opt-in, in order to vet businesses and ensure that we meet our obligations before the distribution of funds, either as Safe Network Tokens or payments in fiat.
Q. What are the responsibilities of the Safe Network Foundation related to the misuse of the Network for illegal content?
A: While intermediary liability regulations, on a whole, tend to shield the Foundation and its trustees from a general monitoring obligation over the content shared on the Network, many jurisdictions do have exemptions from intermediary liability provisions for terrorist and CSAM content.
Additionally, there are jurisdictions which are proposing or already have imposed senior management liability provisions, which are regulations which hold senior management and directors accountable for grievous misuses of their networks for illegal content. As the UK, where MaidSafe is located, is one of the countries proposing a senior management liability regime, we are closely monitoring the situation and any implications it might have for the company, its employees, the SN, and its trustees.
We’re also currently exploring the technical constraints, and possibilities, for dealing with those various forms of illegal and abhorrent content, should they be shared on the Safe Network. To do so, we are engaging with several national and international policy networks which have expertise in these fields. While tackling harmful content in decentralised environments is a novel area of research, and has challenges unlike those of traditional centralised systems, it has the potential to offer solutions that not only help uphold human rights, but do so in a way that is driven by global consensus, and that is resistant to subversion.
In addition, these solutions would also have the potential to lower the compliance burdens and barriers to entry for application and platform developers, none of whom want their work to be abused for the dissemination of abhorrent illegal content, and most of whom will, themselves, have legal compliance obligations they themselves must meet.
We take the view that MaidSafe, and the Safe Network Foundation, could become pioneers in the development of decentralised services which keep these kinds of content off the Network without violating the privacy of our users or breaking the encryption of the system, and we’re quite excited to see what role we can play.
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As an open source project, we’re always looking for feedback, comments and community contributions - so don’t be shy, join in and let’s create the Safe Network together!