Localhost is a program that lets you access a shared, world-wide file system through your web browser. This file system is maintained in a fully decentralized way by all of the computers running Localhost. The program uses BitTorrent technology, and P2P Distributed Hashtable technology called Kademlia. (Localhost is a modification of Azureus.)
Great idea. Another bad name.
Localhost creates a wiki-liek global virtual hierarchical filesystem "containing" torrents. Wiki-like, anyone can edit any node of the directory tree. Un-wiki-like, all versions and branches coexist as long as anyone has viewed (and keeps caching while running the client) that version. People newly browsing to a new node apparently get the "most popular" version. (Most popular globally or locally, I wonder.)
In functionality, this is very similar to an idea we kicked around at Bitzi in early 2001. We called it "Chaotegories", and was intended as a bigger, messier, overlapping-visions way to categorize media files in a vaguely DMOZ-like way. There'd be a "majoritarian" view of the tree -- summed from everyone's preferences -- but your personal moves of items and categories to and fro would be persistent for you, and perhaps others in declared agreement with you, so that's what you and they would see. (Consistent with the idea of Bitzi being a canonical reference site, we would have hosted the tree -- allowing mirroring -- unlike in Localhost, where it lives in the network.)
(I think I had several 'chaotegories' domain names for a while... the problem with reserving a marginal obscure name, then letting it lapse, is that some speculators/squatters specifically grab names on expiration. So if you want to then come back to it -- your earlier registration is worse than if you'd never registered it at all. Chaotegories.com is held by a squatter now.)
I suspect the system of Localhost would have to include some dampener to prevent the "popularity breeds popularity" effect, where the fact most people never go past the top versions means they enjoy self-reinforcing dominance. I look forward to seeing the interface for choosing versions "below" the top one. It looks susceptible to intentional pollution.
The natural extension would be to allow multiple signed roots to which only "leagues" of coordinating, loosely-trusted users can make changes. (Perhaps, everyone sharing some secret would have mutual edit rights for a certain rooted subtree.) Leagues would compete, merge, split, and so forth. (This variant is a lot like a completely P2P Wikipedia idea I've kicked around with a few people.)
A neat feature would be: given a target torrent, what are all the different paths that lead to it (with weights)? But that begs the question: would a nonhierarchical del.icio.us-style tagging system be more flexible and appropriate here? I know that idea will be tested soon.