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Blockchain: Copyright and (De)Centralisation

Copyright law is cognizant of the ways in which anonymity can play out in conventional fields as it demonstrates through provisions determining the term of copyright to anonymous works. The law, however, is not especially well equipped to deal with anonymity and blockchain together despite the fact that we have partially segued from the industrial information economy, which copyright law could be considered to have anticipated, to a networked information economy. 

Blockchain and traditional copyright law do not fit together neatly allowing open data and 'piracy' to effectively be two sides of the same coin despite offering high hopes for a transition into an economy in which open knowledge prominently features. On the contrary, although blockchain certainly does have its benefits, not least of which are allowing for the fractional ownership of protected works stored on-chain and, potentially, facilitating a thriving marketplace in secondhand digital copies since it enables each copy to be individually identifiable, its largely immutable structure and bypassing of trusted intermediaries also makes it resistant to addressing such issues as mistakes of provenance and outright fraud.

There is no sure way to determine the ownership status of copyrightable or copyrighted works that find their way to the distributed ledger that is blockchain since such information is often informal, contained in non-searchable databases incompatible with each other, and easily changeable off-chain. The problem of determining copyright ownership is not novel by any means but, given that it stands out in stark relief against the much-touted transparency and integrity of blockchain, it is a problem that is entirely inescapable in the new networked economy, and could potentially lead to misdirected payments for the exploitation of protected works particularly in cases where blockchain is employed to facilitate the payment of royalties. The solution to the problem may lie in blockchain itself if it is universally used to store ownership information. However, in relation to the vast majority of works, such a day lies far into the future.

Further, the immutability of blockchain poses technical legal issues where copyrighted content is stored without authorisation not least because intermediaries are shielded from liability for infringement only in a limited number of circumstances which essentially require them to have been unaware of the commission of infringement and to remove infringing content once they become aware of it. Unfortunately (in this context), the removal of infringing content from blockchain may be well nigh impossible since immutability is built into the structure of the technology.

The decentralisation and democratization of data are two fundamentally different processes, as blockchain demonstrates. When it is used in conjunction with copyrighted works, the works themselves may be stored on-chain or off-chain. Independently of where they are stored, payments due or paid in relation to the works may be handled on-chain. The works, if they are stored off-chain, could be hosted in physical form or on various websites, possibly mirrors of each other, which could make data 'universally' accessible. In such cases, it is tempting to synonymise the decentralisation of power over works with the decentralisation of storage of works on to which is appended the universalisation of access.

However, a structural arrangement or change to make works 'universally' accessible (like having works stored at multiple sites) does not democratise data or establish the openness knowledge by itself unless the control of the works is beyond the control of a single person whether licensed publisher or so-called 'pirate'.

Democratising data requires taking data — protected works in the context of copyright law — and relinquishing sole control of it whether by using blockchain or by some other means. In any case, falling short of relinquishing control merely results in either a change or a reiteration of gatekeeping mechanisms and a failure of disintermediation, supposedly one of the salient features of blockchain, especially where a public version of that technology is used. It is not a breaking down of the ownership gate corralling exclusivity envisaged by conventional copyright.

With copyright being primarily an economic right, works protected by it do not exist in a vacuum without reference to monetary considerations. And, so, cryptocurrencies have a role to play in respect of protected works on-chain or associated with blockchain whether in relation to payments to support an off-chain framework which supports works and access to them or as the means to directly transact in relation to works which could be on-chain. The number of permutations of the ways in which protected works, payments, blockchain, and associated cryptocurrencies could interact is limited only by human imagination. 

To suddenly pick up the words blockchain and 'crypto…' and club them together with the legal publication or infringement of works claiming that they, the words, define a new path leading to a destination that could never otherwise be reached is absurd. There is no new path: the use of blockchain isn't in itself invariably compatible with open data. It is consistent with nothing beyond having technological choices. Likewise, the use of cryptocurrencies to fund access to data is a choice, one which is likely dictated by circumstances. 

If one were prone to cynicism, it would be difficult to ignore that the use of cryptocurrencies may be especially attractive in relation to the illegal publication of protected works since their presumed anonymity could be considered to preemptively resist the enforcement of orders for damages and to avoid mediated transactions, possibly by unwilling mediators, using fiat currencies. However, the anonymity associated with cryptocurrencies is far from absolute meaning that the ostensible 'benefits' of using cryptocurrencies on account of their supposed lack of traceability and consequent ability to thwart recoveries may be more perceived than real.

Blockchain offers the opportunity to build a radically different world than the one we have known but, as a technology, it is agnostic to the ethical considerations involved in access to knowledge. What we do with the technology is up to us, the technology on its own leads nowhere and everywhere all at  once. Unless it is forced to change the world, it will simply enforce the status quo.

(This post by Nandita Saikia is based on a note posted on LinkedIn, and was first published on