Blogging for bitcoins? A look at the crypto-change alternative to paywalls

Another interesting talk at the American Banker conference discussed how cryptocurrency more broadly could address the issue of advertising, ad blockers and paywalls.

One of the presenters, Victoria Van Eyk, wrote a post on medium that essentially summarizes the issues as follows:

• Advertisers loses one to many medium to the Internet: Although not explicitly mentioned in her post, our journey begins with the Internet displacing the incumbents - TV, print and radio - as the advertisers destination of choice. It was the Internet that enabled the "attention merchants" (as Tim Wu puts in his latest book) to better target us in terms of ads.
• Targeted Ads, Privacy and the Invasion of our minds: The post does a good job in terms of summarizing the creep factor of the ads - in terms of how technology has been developed to actually follow you around on the web to get you buy something based on your habits. The other aspect is the whole idea of advertising itself or as Tim Wu puts the "sale of attention". In his talk at Google, which summarizes the history of how both public and private enterprises used the media and "sticky eyeballs" to attract attention; see this video below for a quick snippit of the type of things he discusses.

• Ad Blockers - the remote control of the Internet: Of course technology is a double-edged sword. So like the remote control that enabled people to skip commercials (which Tim Wu explains was invented by the eccentric owner of Zenith, Eugene F. McDonald, as an electronic device that would literally zap the commercial), ad-blockers came to be our best friend in terms of protecting us from these unwanted ads.
• Media companies strike back: Just when you think the consumer rebellion would succeed against the corporate empires, they strike back. Companies make you turn off the ad blocker to use their website. As the hold access to the material, they ultimately have the power to withhold the content unless we comply with their demands. 
• Enter crypto-currency based micro-payments: The solution to this tug-of-war? Micropayments. When I heard the panelist discuss this, I thought this made a lot of sense. Being someone who has given into paywalls, I would most likely have a media budget set aside that would allow me to pay for articles - 10 cents here or 25 cents there - to consume content. This is much better than being on the hook for hundreds of dollars a month for subscriptions you may or may not use. In Victoria's post, she mentions a number of services that are working on this model, including Brave (which uses cryptocurrency) as well as Patreon (see video below). 

As I mentioned in my last post, the bitcoin represents the world of open and this is one of the use cases that illustrates its potential. With bitcoins micro-payments can be potentially cheaper, friction-less way of making these types of payments that were prohibitive in the credit card centric world that we currently inhabit. For example, Brave notes that they charge 5% in their FAQ. However, without bitcoin they would have to charge a 2.5% credit card fee on top of that for their business to be viable.

Although it would be nice for us to see this hit a critical mass, I think one of the challenges beyond the cost is the underlying psychology that prevents people from paying out: I think many would rather sell access to their mind to the attention merchants instead of paying out digital cash. 

  

Public versus Permissioned Blockchain: All of the above?

Earlier this year, I attended the American Banker's conference on Blockchain.

One of the sessions that attracted me to the conference was the session, "The Debate: Permissioned vs. Permissionless Blockchains".

This is one of those good old tech "religious" debates on whether the future is open or closed - similar to open source versus proprietary software debates of old.

As for public blockchain this is referring to Bitcoin or Ethereum.

As for permissioned or closed blockchains, I had written an earlier post where I explored Goldman's take on the "permissioned blockchain" where the participants are known to each other.  I had noted in the post that the "consensus mechanism in the permissioned blockchain is quite different than it's public counterpart, which relies on the proof of work (POW)... This is not the case for permissioned system which require the consortium who set-up the blockchain to determine how they will work with each other". Some main examples of permissioned are R3, Hyperledger, and NASDAQ's Linq. The following video gives a quick breakdown of Hyperledger and the key features of a permissioned ledger:

Before seeing the debate (more of a spirited discussion), was that permissioned was going to win out.

To be honest, what I see as the main obstacle of the public blockchain is the amount of energy it needs to sustain itself.  Linked to that is how much more energy it would require to hit the level of Visa or other credit card transaction processing to become mainstream.

It's not to say there aren't other issues, such as confidentiality and regulatory opposition to the technology, but I see this as one of the key challenges. So I thought we would at least see permissioned ledgers dominate at the outset.

However, what I realized after seeing the debate was that I wasn't approaching this from the right perspective.

What Siddharth Kalla (Chief Technology Officer, Acupay) noted in the debate was that you need to think what's the equivalent of Google and the blockchain. What he was saying was to think of blockchain as the equivalent of the Internet: how could we have predicted that TCP/IP would have ushered in the technology-giant we now know as Google? 

That concept hit my mind like a bolt of lightning: think about all the things that Google has brought about, search, gmail, Android, and cloud-based office productivity. 

That's the power of open.

And that's what I realized is that I needed to think of bitcoin or Ethereum as the Internet of Value's first proof-of-concept (POC). There will be someway to overcome the limitations I noted above and make it viable. It's only matter of time before the equivalent of Sergey Brin and Larry Page will unleash the power of open on the public blockchain. 

So what about the permissioned blockchain? Will it die out?

Where I am is that this not about one or the other. Rather, each solves for different problems. The public blockchain is about exchanging value with strangers. The permissioned blockchain is about exchanging value with private parties that an entity regularly deals with. In a gross oversimplification of the latter, it is a "secured-shared-spreadsheet" that replaces the routine exchange of spreadsheets by email. I like the term distributed ledger ledger technology, as used by the World Economic Forum, to describe the latter. 

Although the two are closely linked now in terms of community and development, eventually the two communities will separate based on what societal or business challenge they address.