Massively Multiplayer Peer-to-Peer

I've been playing a few Massively-Multiplayer Online (MMO) games, and they all seem, to some extent, limited by the client-server model.

The current game I'm playing, Flyff is plagued by lagging, disconnects and full servers.

It seems like the holy grail of MMO is peer-to-peer. However it comes with an inherent problem -- how can the game maintain a singular, persistent view of the "world", and yet distribute the management of that world to different computers.

Well, it seems to me that this could be accomplished using a concept of localised reality. For instance, if 50 people are in virtual London, those 50 people agree on the events that take place, and then communicate that back to the server.

Of course the big fear is cheating. If I can fool the server into thinking I've made £100 when I haven't -- I can print money.

But I think if there was an intelligent way for peers to confirm the events of peers (I don't make £100 unless the person to the left and right of me agree I've made £100) then you can have a peer-validated world that doesn't cheat the rules of the game.

Easier said than done.