Editing Atomic cloud storage (section)

= Economic attacks =

What’s good about this scheme is that the outcome of contracts are all publicly verifiable on the blockchain - so anyone can see if a farmer failed to pass an audit or if a renter didn’t download any of their files. But there are a few remaining problems – 1. what happens if the renter doesn’t download any of their files (depriving the farmer of the download revenue) or 2. if the farmer passes all audits but still doesn’t give up the download? [24]

I would argue that problem 1 isn’t really a problem at all – if the renter chooses not to download their files back then they’re simply not getting charged for a service they’re not using – after-all the reason why downloads cost money in this context is because bandwidth costs the farmer money so the download contract was created with that in mind [25].

On the other hand – if the renter actually wants to be able to download back their files and the farmer refuses – there should be a consequence for doing that. The way that Sia solves this problem is to use collateral [24] but I think the planned approach that Storj uses is more elegant – proof of stake.

Under PoS you require that the farmer keeps a certain number of coins in a publicly associated address. This proof of stake then becomes their reputation which can be publicly burned if anything goes wrong. So you’re not requiring collateral to be entered into every transaction but the farmer’s long-term reputation and their initial upfront payments are still at stake.

Also consider that the renter can still get back the money they used to front the download contract and I think the game theory dynamics happening for these contracts seems to be the fairest possible for both sides. In a nutshell – this contract dynamics allows for pay-as-you go storage and downloading that simultaneously protects the farmer and the renter while guaranteeing that as long as they uphold their terms of the contract there is a favorable outcome for both sides (i.e. either getting paid or getting their money back + having the service provider punished.)

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