Observations on Infrastructure Location Proofs (1)

This past few months my focus has been on finding commercial applications for location proofs. The recurring need I'm seeing involves verifying the location of nodes running on decentralized networks, and making better management decisions based on that information. This note is an effort to articulate and unpack what I'm seeing, and to invite engagement from people to color things in.

Observations

One of the hallmarks of decentralized systems is that they are open (or "permissionless" — one of the Web3 design principles I find most compelling) — anyone can join, or leave, the network. Service / infrastructure providers are coordinated using token incentives and other cryptoeconomic mechanisms.

If designed well, this is a powerful way of ensuring durability. By relying on self-interest and consensus mechanisms and other protocols for dispute resolution rather than legal commitments and master-slave architectures, decentralized networks have remarkably high liveness guarantees. The Ethereum network has never halted or failed, even as it has scaled to control billions of dollars of value, and attracted commensurate attacks.

For most networks, joining involves generating a keypair, and securing resources (hardware or economic stake), downloading client software, syncing, and then participating in network management. Where the entity is incorporated, where the entity's employees or owners are physically located, and where the infrastructure they offer up to the network runs, are all self declared or weakly inferred — if location is measured at all.

One way blockchains and other decentralized systems are gaining traction is through their recognition and integration with the existing financial + legal system. Also, as they mature, new risks are identified, requiring new mitigation strategies. And customers bring their own requirements, for any range of reasons.

This combination of conditions is creating an emergent need: location proofs + intelligence tools for decentralized systems. By making the geography of decentralized networks legible, we can improve resiliency, increase compliance, and offer new product functionality.