/biz/ - Business & Finance

There's no need for DVPN technologies to use a blockchain. Blockchain isn't a requirement for a DVPN. In fact, it's completely reasonable for DVPNs to take payment in Bitcoin or monero, or even fiat, or not at all. For every Blockchain DVPN type technology I've looked at, the token economics don't stack up. Inevitably these things are nothing more than ERC20 tokens used to fund the development rather than operation of the network, which leads to some perverse incentives for subscribers.

The problem with DVPNs is that there are more providers than consumers, so there's scope for a supply glut which depresses prices. This type of problem has already happened with storage blockchain services e.g. STORJ and SIA.

Then you have DVPN-type technologies like Substratum where not only are there no published token economics details whatsoever, there's no understanding of what costs will be (therefore it becomes impossible to accurately value the token).

In all cases any DVPN is competing (for want of a better word) with Tor, which is free and conventional VPNs, which are quicker. Any intermediary multi-hop routing protocol is going to have latency issues, Tor have done tons of research into this and it's a fundamental part of the anonymity/speed tradeoff. The only way DVPNs can compete with conventional VPNs is on cost, which is aided by the supply glut, but ultimately pitches them squarely against Tor. As Tor is free, the one advantage a DVPN has over the competition (cheapness, not speed) is lost.

I'm not saying these things can't exist, nor that they can't somehow make some amount of money, but mass adoption to the point of displacing Tor or centralised VPNs just isn't going to happen.