Better Bitcoin Relay? Crypto VCs Back BloXroute Funding Posted on : Mar 22 - 2018

There's one part of bitcoin that isn't censorship resistant - its relay network.

At least that's according to the team at BloXroute Labs, which just brought its network for relaying information between blockchain nodes out of stealth with an impressive group of investors including AngelList co-founder Naval Ravikant, Metastable, 1confirmation and Flybridge Capital. Through these investors, the company raised $1.6 million in an equity round.

But the new network is more ambitious than the capital suggests. Called BloXroute, the project aims to make relay networks censorship-resistant against any number of powers by blinding the system from knowing how nodes connect with each other. And that, they say, is an improvement on the current infrastructure, largely built over the years by volunteers.

To understand this, it helps to know where relay networks originated, coming about as "mining pools," or networks of miners seeking to share profit started to form.

Smaller mining pools saw a higher number of orphan blocks (those that weren't eventually added to the blockchain) since they were usually not the ones that found blocks. This meant they spent time working on the wrong blocks as the information took time to propagate to them. So, in an effort to level the playing field, relay networks allowed faster for the faster propagation of information over the network.

While Uri Klarman, BloXroute Lab's CEO, said existing relay networks, including bitcoin developer Matt Corallo's FIBRE and Cornell Universities' Falcon, are working fine in this regard, these networks allow parties to understand network traffic, such as the IP address of the node, where it's sending information and where that information is coming from.

In this way, existing relay networks offer insight into transactions that governments, big businesses and others could exploit, censoring certain wallets.

"If the protocol depends on the relay network to scale, then that ends up that everyone has to trust the relay network for that work," Klarman said, adding:

"Then what's the point of the blockchain? Just leave the bank in the middle."

The BDN

In an effort to eliminate this issue, Klarman collaborated with Cornell's Emin Gun Sirer and Soumya Basu to build what they call a "Blockchain Distributed Network" or BDN.

Inspired by the content delivery networks that allow data on the Web to be delivered quickly all around the world, the BDN is entirely controlled by BloXroute Labs. But, the company has spent a significant amount of time building in blinds that will keep the network from being censored.

The government wouldn't try to shut down the company, and in turn the whole network, just for a couple bad actors. View More