Combatting Fraud and Maintaining Integrity: Proposals for Ensuring a Valuable Filecoin Network

[herrehesse]

Issue Description

Dear Filecoin Community,

In the current Filecoin ecosystem, datacap is a highly sought-after commodity. As a result, it is not at all surprising that entities try to amass this commodity without adhering to the program rules. This is particularly true for entities that are in a financial bind or operate large cloud computing operations with mainly CC sectors. These entities will often go to great lengths to convert their sectors to ones that contain datacap deals. Although this behavior is not surprising, it is noteworthy that after extensive research on the LDN's, only a small percentage of large miners actually engage in fair practice. Most of them have chosen a more fraudulent path to growth, largely due to the lack of adequate supervision.

The responsibilities and expectations of a storage provider(SP) who operates with good intentions include:

• Clearly and accurately disclosing their physical location and operation details.
• Investing in and upgrading their hardware and network infrastructure to improve the capacity and speed of data transfer.
• Forming partnerships with reputable data preparers to ensure the quality and integrity of stored data.
• Willingness to cover the costs associated with packaging, bandwidth and storing data deals.
• Maintaining accessibility and uptime of their miners for at least 540 days.
• Ensuring the retrievability of stored data deals for a minimum of 540 days.
• Being transparent and open in their dealings with the Filecoin community and network.

It is a fair and equitable exchange for storage providers who meet the established requirements and actively fulfill their responsibilities to receive support and increased revenue from the community in the form of a multiplier.

However, the majority of storage providers (SPs) do not adhere to the responsibilities and requirements mentioned above, particularly when it comes to maintaining high standards of data integrity and availability. This trend needs to be addressed and rectified. It is important to keep in mind that the scope of data storage and network power being discussed is not limited to mere terabytes or petabytes, but rather extends to an exabyte and beyond. It is a more significant issue than one may initially realize.

It has been made alarmingly clear that certain large storage providers have been colluding to make hundreds of datacap requests for their own benefit, effectively converting their entire mining operations to verified sectors with the multiplier. This is not only a flagrant violation of the rules, but a brazen act of fraud and theft, stealing revenue from all the entities in Filecoin who are working hard to play by the rules. This behavior is unacceptable and must be addressed immediately.

Impact

It is disheartening to see that while many genuine companies and businesses are working tirelessly to build and contribute to the Filecoin ecosystem, there are bad actors who are exploiting the system for their own gain. Take PiKNiK for example, a company that has invested millions to recruit new storage providers and make the network more valuable. Or SEAL Storage, a company that has always been committed to storing humanity's most important information at storage providers around the world, with a focus on high-quality research data. And let's not forget the countless software companies that are investing in the protocol to add value and make the ecosystem more accessible for businesses and individuals.

These examples illustrate the hard work and dedication of many players in the Filecoin ecosystem. However, it is a harsh reality that not everyone shares these values. We must stop assuming that everyone has good intentions and start looking at the facts. The fact is that many datacap requests are not being made with the best intentions, and it is the responsibility of the applicants, data preparers and storage providers to prove otherwise.

Datacap is a valuable and scarce resource that should be used to benefit the entire Filecoin network. Its abuse not only undermines the integrity of the blockchain, but also undermines the hard work of those who are trying to build a better, more valuable ecosystem. It is our duty to hold those who abuse the system accountable, and ensure that the value of datacap is protected for the benefit of all.

Proposed Solution(s)

It is our recommendation that moving forward, datacap should only be allocated to applicants that have been proven to operate with good intentions and that strict adherence to the following rules should be upheld:

• Adhering to a fair and impartial process for all entities seeking datacap, with no exceptions or special treatment.
• Allowing all entities a (single) opportunity to prove their intentions and qualifications.
• Implementing a thorough Know Your Customer (KYC) process for both the applicant and the data preparer, conducted by multiple independent notaries.
• Requiring storage providers to provide their company name and proof of location to prevent the use of virtual private networks (VPNs).
• Storage providers who are found to be using consecutive IDs must provide proof that they are separate and distinct entities in order to avoid suspicion of fraud. The burden of proof will be on the miner to demonstrate that they are operating under different identities, and not simply attempting to cheat the system.
• Developing a ranking system for known applicants and notaries to promote trust and transparency within the network.
• Applicants must provide comprehensive details and plans for the distribution and use of the datacap.

In our view, it is essential that there is a clear and defined set of expectations and requirements for entities seeking datacap. Currently, many of these expectations are left ambiguous in an effort to be inclusive, however, it has become evident that this approach has led to widespread abuse and is detrimental to the growth and success of the Filecoin network. The time has come to establish clear and specific guidelines to ensure that only well-intentioned entities are able to acquire datacap and contribute to the network's progress.

Proposed guidelines for the Filecoin+ program:

• A minimum of six data replicas must be maintained to ensure data redundancy and availability.
• Data must be distributed across a minimum of three continents to ensure geographical redundancy and accessibility.
• A maximum of two copies of data may be stored by a single company or entity, if hardware is located in different cities.
• The sharing of CIDs (Content Identifiers) is strictly prohibited, with the exclusive exception of duplicate or identical datasets, if the packing process can be independently verified.
• Miners must be reachable at all times, with a minimum uptime of 98%, a maximum of 6 days of annual downtime.
• Deals must be retrievable at all times, to ensure data integrity and accessibility.
• Data stored must match the original content as declared in the LDN datacap application.
• The use of Virtual Private Networks (VPNs) is permitted, as long as it is not utilized for fraudulent activities with intent. When abuse is suspected, the burden of proof is on the respective storage provider and cooperating applicant.
• The data stored under the FIL+ program should be considered valuable and enhance the overall quality and of the Filecoin network.
• (potentially) Using Boost-software should be mandatory to make and receive Filecoin+ deals due to the improved retrievability.

A separate but critical aspect to consider is the definition of "valuable" data. The FIL+ program is intended to support the storage of humanity's most important information, as stated in its description. However, the determination of what constitutes "valuable information" is subjective and can vary among individuals and organisations. Therefore, it is imperative that clear and specific rules, rather than guidelines, are established to define what data is and is not acceptable for the program. This will ensure that the program's purpose is upheld and that all entities understand the expectations and requirements for participating in the FIL+ program.

We believe that the FIL+ program should have strict requirements for applications, as the datacap provided in return is extremely valuable. It is only fair that in exchange for this valuable resource, the Filecoin community should expect a significant contribution or added value to the network from the applicant, data preparer, and storage provider. If the applicant is not able to meet these expectations, the community is more than willing to assist with regular paid deals.
Allowing non-valuable data to be stored through the FIL+ program would dilute the program's purpose and undermine the efforts of storage providers who are truly committed to this mission.

Moreover, by requiring other data to move through regular paid deals, it ensures that the scarce and valuable datacap is being utilized efficiently and effectively. This helps to ensure that the program is being used for its intended purpose and that the resources such as datacap are being directed towards preserving and storing important information. In addition, it also ensures that the network is not overcrowded with non-valuable data, which can bring down the overall quality of the network.

Examples of data that can be considered valuable and contribute to the Filecoin network include:

• Large-scale medical research data, including genomic data and clinical trial data.
• Historical documents and artifacts that are important for preserving human culture and history, such as manuscripts, photographs, and artifacts.
• Cultural and artistic works, such as literature, music, and film, that are important for preserving human creativity and expression.
• Climate data and environmental research that is important for understanding and addressing global challenges such as climate change and biodiversity loss.
• Financial and economic data that is important for understanding and analyzing financial markets and economic systems.
• Educational resources and academic research that are important for advancing knowledge and understanding in various fields of study.
• Scientific research data, including data from experiments and simulations, that are important for advancing understanding in various scientific fields.
• Social and demographic data that is important for understanding and analyzing various social and demographic phenomena.
• Digital archives and libraries that are important for preserving and providing access to a wide range of digital content such as books and articles.

It is with great disappointment that we have discovered, after thorough research, that a majority of applications submitted are not genuinely focused on storing valuable data as defined above, but are instead primarily focused on gaining access to the multiplier benefits provided by the FIL+ program.

We have found and should not allow instances of the following:

• Fake websites created specifically to deceive the community and gain access to datacap.
• Impersonations of legitimate companies, with the aim of obtaining datacap.
• Completely fabricated and false applications, containing no relevant information or data.
• Applications that claim to store data, but in reality, the data is completely non-existent or empty.
• Unauthorised, or intentional misuse of CIDs for the sole purpose of consuming datacap.
• Data that is stored without the proper permissions or consent from the rightful owner.
• Random and irrelevant videos, photos or documents, which have no value to the Filecoin network.

These fraudulent activities are not only a violation of the integrity of the network but also have no intention of contributing to the Filecoin network's goal of storing humanity's most important information. It is imperative that these types of applications are not supported and strict measures are taken to prevent them from accessing datacap and diminishing the value of the network.

This situation is unacceptable and cannot be allowed to continue. The purpose of datacap is not to enable fraud, but rather to reward storage providers who are committed to storing humanity's most important information and contribute to the overall integrity and quality of the network. Fraud should be kept to a minimum, and all entities should be held accountable for their actions.

In light of this, we will also propose a new FIP (Filecoin Improvement Proposal) that would allow for the removal of datacap from entities who are proven to have obtained it fraudulently. This would prevent them from receiving the long term rewards associated with their actions and prevent them from continuing to harm the integrity of the network and the broader Filecoin community. It is essential that this type of behavior is not tolerated and that the network is protected from those who seek to exploit it for their own gain.

In conclusion, it is important to remember that we are all here for the same goal: to make decentralized storage a reality and create a more valuable Filecoin network. Any actions that undermine this potential, whether it is through fraud or other unethical behavior, must be held accountable. We must work together to ensure that the network is protected and that the scarce resources of datacap are used efficiently and effectively.

Let's remain civil in our discussions and be transparent in our intentions and actions. In this way, we can work towards achieving the shared goal of creating a more valuable and sustainable Filecoin network for everyone. We welcome and value all feedback and opinions regarding the proposed rules and guidelines outlined above.