Bitcoin, blockchains, and national security.

Picture this: it’s 2020. President Trump orders a military strike on a key underground nuclear facility in North Korea. Kim Jong-un storms into his war room and commands his generals to immediately retaliate. They caution him to avoid all-out war, and provide him with a list of targets.

The list consists solely of Amazon, Microsoft, and Google data centers. These are not traditional targets — they are cyber targets. North Korea knows that, by taking down several key data centers, it can cripple the US economy.

Two weeks ago, Amazon S3 experienced a few hours of downtime and disrupted service. This in turn caused issues with thousands of sites that host files on S3. Many Americans could not view their Instagram photos, their Twitch streams, their Netflix movies. But this outage also affected services that US companies rely on daily: Atlassian, Slack, Autodesk, Github, Trello, Twilio, Zendesk, and more. Even the SEC’s website was affected.

When we rely on centralized cloud services, like AWS, we open ourselves to the possibility of widespread outages. Luckily, these rarely occur. Last week’s S3 outage was caused by a typo, and by now Amazon has likely made changes to prevent this type of outage from reoccurring.

But let’s be clear — centralized cloud services will always come with great risk. Greater centralization = greater risk. As more companies shut down their in-house servers and move to Amazon, Google, and Microsoft services, the ramifications of any outage will be far more pronounced. There is no such thing as 100% uptime.

Centralized cloud services are good when times are good. We are not currently at war. We have not had an attack on US soil since 9/11. We are not under any imminent threats.

But it is not enough to simply build for good times. When we build a house, a bridge, or any other physical infrastructure, we are required to follow building codes. These codes anticipate possible scenarios — like hurricanes, earthquakes, or bombings — and require us to build in greater redundancy.

We need to treat digital infrastructure like physical infrastructure. And I believe our digital infrastructure is not prepared for the worst case scenarios: natural disaster or war. Our data centers are large targets for malicious actors. To cripple our economy, a malicious actor needs only to cripple a few Amazon data centers through cyber attacks or bombings.

Centralized digital infrastructure is a major threat to national security.

Most ardent Bitcoin believers are Silicon Valley tech-types, libertarians, and/or crypto-anarchists. Among these groups, Bitcoin has been touted as brilliant technology, freedom from government control, value-preserving, decentralized, trust-less, open source, and more.

Bitcoin.org reads:

Bitcoin uses peer-to-peer technology to operate with no central authority or banks; managing transactions and the issuing of bitcoins is carried out collectively by the network. Bitcoin is open-source; its design is public, nobody owns or controls Bitcoin and everyone can take part. Through many of its unique properties, Bitcoin allows exciting uses that could not be covered by any previous payment system.

All these points are true, but a large component is missing: extreme redundancy. There are few paths to fully shut down the Bitcoin network. A malicious actor could target the thousands of full nodes and miners, but these parties are distributed across the globe. A malicious actor could take control of 51% of mining power, and begin to manipulate the network, but this would take billions of dollars and there are many defenses.

When comparing Bitcoin infrastructure to centralized digital infrastructure, redundancy benefits are negligible — in good times. When disaster strikes, however, Bitcoin’s redundancy benefits are vast. A malicious actor can destroy data centers, but it cannot destroy the Bitcoin network. Transactions will continue to flow. The same holds true for blockchains in general.

Bitcoin and blockchains directly threaten centralized government control. But governments must decide — are they willing to give up some control in order to greatly strengthen national security and defend against damaging cyber attacks? The answer seems obvious.

Bitcoin and blockchains will allow us to create a decentralized internet, simultaneously bringing far greater freedom and far greater national security. Bitcoin will create an unbreakable global finance system, replacing current centralized banking infrastructure. Sia will replace Amazon S3, Google Cloud Storage, and Microsoft Azure Storage. Blockchains will facilitate the creation of decentralized energy markets, voting systems, and other decentralized digital infrastructure.

For these reasons, it is not enough for Bitcoin and blockchain projects to be supported by the technology community — they need to be supported by governments and militaries. Our national security may depend on it.

Sia, by Nebulous Inc., is a blockchain-based decentralized cloud storage platform. Zach works as Head of Operations for Nebulous.