A German team of researchers has made a shocking discovery on the Bitcoin blockchain. The researchers found links to child pornography and at least one image of such content. Since the entire Bitcoin must be downloaded to mine Bitcoin or run a full Bitcoin node – a program that validates transactions on the network – this means that anyone who does so is potentially in possession of illegal content.
In the vast majority of cases, the data on the Bitcoin blockchain consists of a list of transactions on the network. But it is certainly possible to store data on the blockchain. In fact, the first block ever mined on the Bitcoin blockchain contained a text message, left there by its creator, Satoshi Nakamoto. Now it appears that some have used this property of the blockchain to insert potentially illegal content.
The research presents an analysis of about 1,600 files on the Bitcoin blockchain. Most of this content is “harmless,” but there is at least one file that depicts “a young woman naked” and “hundreds of links to child pornography.” As a result, it could become illegal to own the blockchain, which is required to participate in the Bitcoin platform.
The document lists several other types of content that could be problematic if found on the blockchain: data that violates copyright, someone's privacy, politically sensitive content, or just plain old malware.
The problem is Bitcoin’s immutability – we can’t just remove a block from the blockchain. Think of it like stacking bricks on top of each other. If we remove one, the whole building collapses. This is good for financial transactions, as it makes it impossible to double-spend, but it’s problematic when there’s an illegal image or link there. And yes, there’s a lot of illegal content on the internet.
For the average user, this isn't a big deal. One can easily store Bitcoin in a so-called light wallet, which doesn't require downloading the entire blockchain to their computer. But if it's illegal to own the blockchain, it affects miners and people running full nodes, and Bitcoin can't function without them.
One could argue that just mining Bitcoin or running a full node doesn't necessarily mean you'll be using data hidden on the blockchain for malicious purposes. But it's still concerning that legitimate uses of Bitcoin in some cases require downloading and storing potentially illegal content on your computer.
Currently, Bitcoin’s immutability is a non-negotiable feature. It is not possible to delete or change any part of the blockchain after it has been mined. It is possible that Bitcoin will change this in the future. Methods that could mitigate the problem include, for example, blocking certain types of data on the blockchain from running full nodes or mining, or encrypting the blockchain (or parts of it), but these would require a very significant change to how it works, potentially undermining some of its greatest advantages.
