In an era of AI-generated content abundance and concerns about censorship, analysts at research and brokerage firm Bernstein say blockchain technology has a unique role to play in the pursuit of truth.
A look back at the past few weeks, which saw Facebook founder Mark Zuckerberg admit to consenting to COVID-related censorship in 2021, Telegram CEO Pavel Durov arrested in France for allegedly failing to moderate content, and X feuding with Brazil over its failure to remove misinformation, Gautam Addagni, Mahika Sapra, and Sanskar Chindalia wrote in a note to clients on Tuesday that the “immutable ledger” nature of blockchain technology could help prevent censorship.
Analysts say that while traditional media is ramping up fact-checking on politicians during the U.S. election cycle and X is trying to moderate content by adding context rather than deleting posts or banning accounts through its Community Notes feature, Telegram is taking a more extreme stance on censorship.
Unlike other messaging apps, Telegram does not use end-to-end encryption for data and relies on distributed storage across multiple jurisdictions, making data retrieval difficult. It also uses blockchain for cross-border remittances and supports blockchain apps that integrate with cryptocurrency wallets. Despite its stance on privacy, governments have called on Telegram to be more cooperative on serious issues such as child abuse and illegal activities. However, according to analysts, Telegram strongly opposes censorship due to concerns that it could lead to widespread suppression of political views and freedom of speech.
Adding, Safra, and Chindaliah say this raises important questions about what truth is, who gets to decide what’s true, whether governments should be the ones to decide what’s true and pressure the media to censor content or open backdoors for monitoring, and how we should moderate AI content compared to human-generated content.
Blockchain-based social media and democratization of markets
Analysts say there have been attempts to launch blockchain-based decentralized social media platforms, such as Farcaster and Lens, but so far they have had minimal user adoption and struggled in terms of user network effects as most users still prefer centralized platforms.
But blockchain, they argued, has a unique way of democratizing markets by allowing users to tokenize and create markets for any event, and conveys truth by “adding skin to the game.”
One example they highlight is their use of Polygon-based decentralized prediction platform Polymarket ahead of the U.S. presidential election. If users believe that traditional election polls are biased, they can follow Polymarket odds instead to see if they differ from the polls, Chhugani, Sapra, and Chindalia said.
On Monday, Kamala Harris’s odds of winning the November election dropped to 47 percent at Polymarket, while Donald Trump’s odds of winning reached 51 percent as of Tuesday. Trump had been ahead of Harris after the candidates had previously been tied 50-50, and the vice president was ahead in early August. Analysts noted that the numbers compare favorably with national polls that had Harris at 47 percent to 44 percent.
Polymarket’s odds of winning the presidential election. Source: Bernstein.
To cope with the rise of AI-generated content, Bernstein analysts suggest that advances in zero-knowledge proofs could help authenticate human content and add annotations that differentiate it from AI content.
“While AI brings abundance, productivity, and creativity, blockchain balances this by seeking truth, scarcity, and decentralization of power,” they said.
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