Arash (the CTO) asked me to, in a really civil way. So I decided to respect his wish and take down the repository.
Myself, I really regarded dropship as a nice feature. As Dropbox had implemented the great idea of putting all humanity's data in one big hash-addressable vat, sharing is a logical extension. If you would cache the popular blocks locally (dropbox already does this in a way with LAN P2P), global data distribution would be pretty much a solved problem.
Obviously, this affects legal and illegal files in the same way. It's really a shame that people are still so obsessed with the illegal applications, that they become blinded to how useful this is for legal ones.
Yes, as I kind of hinted at in my post, the main reason is that they don't want the stigma that is associated with file sharing.
Even though there is a lot of (social) legal sharing going on between users, the focus is always on illegal sharing. He has a point there, though I think it's a pity.
IMO it's not even that suited to piracy, as the deduplication means that they can find everyone that has a file! Torrents are way better for that.
The principles of dropship could be used for sharing photos, videos, public datasets, git-like source control, or even as building block for wiki-like distributed databases. The possibilities are endless when every file can be called up with just its hash.
There is a way around this. Charge the person sharing the file a certain amount of money after a certain bandwidth (rather than the person downloading the file). This would virtually prevent large scale piracy without preventing many other usages.
I've been doing the same, but on a very small scale. Mostly sending a funny episode of some show to a group of friends or occasionally sending a movie to my folks. I don't doubt that if I was mass distributing these files it would attract attention.
Also, wouldn't breaking the hash nullify one of the ostensible advantages of this method (the de-dupe of the stored files)? If the goal is solving global file distribution, making each copy of every originally-identical file unique - and therefore requiring n times the storage - isn't a viable solution.