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Dealing with Illegal Content on the Blockchain

Posted on March 15, 2022

The internet was meant to be the great equalizer. The information age did not discriminate against anyone’s ideas, as everyone was allowed to contribute to the web. Promptly after gaining popularity, it was consumed by pornography and cat videos. Web3 now faces a similar dilemma. Blockchain promises what Web2 wanted, but failed to create: the internet, sans censorship and government influence, built on decentralized currency. The key to this global network is the immutable ledger, a permanent digital record of transactions and data distributed and maintained by anyone who wants a copy to which anyone is capable of writing to. But what happens when people add illegal content to the blockchain?

Around 2014, blogger Ken Shirrif reported on interesting data converted to hexadecimal and stored on the bitcoin blockchain, including prayers, images of Nelson Mandela, but also illegal government document leaks (Shirrif 2014). With Web3 use growing exponentially, this can only become more of a problem in the future.

There are two paradigms to view this problem through. The moral paradigm is very simple: is there a way to ensure people are not adding bad entries to an immutable ledger? The first way to tackle this problem is to make the ledger immutable; however, this is the fundamental trait of blockchain that makes it attractive to use in the first place. If we can scrub the ledger for illegal and immoral content, that makes it possible to remove any entry on the chain. The security of blockchain relies on this trait (Narayanan, Werbach, and Grimmelman 2018), and without it, the blockchain wouldn’t serve its fundamental role.

The moderate solution proposed is to maintain a centralized ‘Blacklist’ as proposed by the team at MoneyButton (Money Button 2019). Trusted authorities and organizations could be tasked with maintaining lists of wallet addresses, entries, etc. that contain illegal content and businesses/users would be able to opt-out of rendering that material. This centralizes a decentralized framework, and is only a partial solution to the problem. Popular browsing clients would make it more difficult to find this material; however, the material still exists and is available for those willing to search hard enough.

Illegal content has always been available on the internet, regardless of which platform. As of last year, there were more than 70 million reports of child abuse videos across Facebook, Twitter and other Web2 social media (Dance and Keller 2020). We may just have to accept that this is a sad reality of the internet as a whole.

Regardless of the technical framework that our media storage is built on, the internet does enable illegal activity. Most blockchains are not built on anonymity, as pointed out by the Bitcoin Association (specifically in regards to BitcoinSV, a Bitcoin hard fork) and perhaps the most we can hope for is that major companies in the ecosystem extend their zero tolerance policy to their client side (Nguyen 2019).

The other paradigm is the legal perspective and its implications for the future of blockchain. The laws are outdated for this medium. Traditionally, governments serve a Notice and Takedown order; however, that won’t work with an immutable ledger (Schellekens 2019). According to Schlekkens, the responsibility then falls on the intermediaries to regulate the type of content posted on-chain. This becomes even more difficult when people don’t have to use a specific intermediary to upload to chain. Another concern with a decentralized ledger is that retaining a copy of the ledger could be equated to possessing the illegal content on it (with some nuance for people possessing partial copies of the ledger). According to Wired magazine, this shouldn’t be a concern for the future of blockchain. “A general awareness that there might be objectionable data on your computer” does not meet the specifications of most legal systems to constitute illegal activity (Narayanan, Werbach, and Grimmelman 2018). We’ve seen this case law already with people hosting Tor endpoints, and subsequent mediocre solutions to the problem of perma hosting illegal content won’t likely be the downfall of blockchain technology.

In 2014 Gavin Wood, part of the core team at Ethereum gave a talk on ‘Alegality’, the concept that the set of ‘illegal’ is mostly arbitrary (Wood 2014). Governments and DC think tanks often express concern over a permanent public record of leaked classified documents, and media companies over copyrighted content. He points out that laws of this nature must adapt to meet the times and not the other way around, considering for example that recording television programs was illegal until it became unenforceable. “The stage between one state and the other state can be very volatile if both sides do not collaborate”, and as such lawmakers learn from blockchain experts to understand the systems they’re banning before implementing blanket prohibition. And if not, “these systems are a force of nature”, and will likely continue to exist with or without laws surrounding them.

Editor's Note: Bruce Schneier published a story on illegal content on the blockchain, which seems to have been picked up by many publications, all of which link to Ken Shirrif’s blog post as evidence for illegal pornography. Shirrif’s blog post does not contain any mention of this and it is unclear where this came from. I’ve cited Schneier’s story, published in Wired magazine.

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