Basic Attention Token: Blockchain-Based Digital Advertising
There’s no question that digital advertising is broken. Advertisers and publishers both agree that the current models, which are largely dominated by large technology platform including Google and Facebook, are highly inefficient and carry a number of serious ethical concerns regarding user data. Kevin Akeroyd, the global CEO of Cision and the individual responsible building Oracles marketing cloud, identified the issue that many advertisers face in their decision to continue using digital advertising:
“[Advertisers] are not going to be able to back out of the decade-long investment they’ve made in digital,” he continued. “Their P&L (profit and loss statement) simply isn’t going to allow it, right? They can’t say, ‘Well, I took the bad advertising out of my budget and that’s why I missed my earnings per share.’ I don’t think Wall Street is going to allow them to do that.”
Publishers face similar issues, as the current system seriously undercuts the value of their content, in large part due to Ad blockers, which are forecasted to cost publishers $35 billion by 2020. As these publishers face falling revenue and users feel increasingly violated, advertisers’ ability to assess the effectiveness of their digital campaigns is severely diminished.
These issues have many looking for blockchain-based solutions. Recently, popular media site Salon.com tried to offer a browser miner called Coinhive as an alternative to advertisements. While this might be a good solution for certain high traffic volume publishers, it certainly does not address all of the ongoing issues plaguing digital advertising.
One project that hopes to have the final solution is Basic Attention Token (BAT), a decentralized, transparent digital ad exchange based on Ethereum Blockchain. To build this more efficient exchange, BAT created Brave, an open-source privacy-focused internet browser that contains a ledger system that anonymously captures user attention to accurately reward publishers with BAT tokens. Through their system, BAT offers a significant alternative for advertisers looking to improve their ROI with digital advertising campaigns while offering clear monetary incentives for both users and publishers.
Interested in BAT? Here’s a quick rundown of the project:
Platform & Development
The key element of the BAT platform is ‘Attention,’ which is measured as users view ads and content in the Brave browser’s active tab in real time. According to the BAT website, Attention Value for an ad is calculated “based on incremental duration and pixels in view in proportion to relevant content, prior to any direct engagement with the ad.” These ads are then anonymously matched with users through machine learning algorithms that leverage previous browsing data. This offers truly targeted advertisements that make the most of an advertisers investment.
Users benefit from anonymity in their browsing, limiting the odds of invasive data breaches. Additionally, Brave blocks ads and trackers, reducing the chances of being infected by malware, ransomware, and spyware. Users are incentivized to use Brave through passive BAT rewards for simply viewing ads as they browse. BATs can be used for premium content or services on the Brave platform.
Publishers earn the majority of the BAT rewards that are paid out through Brave. Given that there is no middleman, like Google Adsense, taking a large cut of ad revenue, publishers are able to earn far more relative to current advertising options. In the table above, which is included in the BAT white paper, you will notice how big of a step up the BAT platform is when compared to the traditional systems.
All BAT payments are monitored via a payments tab on the Brave platform that is seamlessly integrated with the BAT wallet. The process is fairly straightforward for publishers to establish their sites on Brave to begin earning BAT payments. For interested publishers, Brave provides a 4-step guide to become verified:
- Step 1: Open the email invitation sent from Brave Software to your webmaster. The email is titled “Brave Publisher Invitation” and includes all of the information needed to verify your site.
- Step 2: The email will direct you to a web page where you will need to confirm your site ownership. The site will guide you through a simple process of adding a new record to your DNS host account. This ensures a secure handshake between Brave Software and you – preventing someone else from receiving your payments.
- Step 3: After verifying your site, you can view the current funds available for withdrawal. If you are ready to receive your funds, you may verify your wallet and submit the necessary tax forms.
- Final Step: Check your wallet balance frequently, and transfer funds to wherever you choose. It’s your money. You earned it! And – once you are verified, we welcome you to add a Brave badge to your site which will help lead your visitors to download Brave.
Basic Attention Token (BAT) currently has a market cap of ~$190 million with a circulating supply of 1,000,000,000 BAT and a total supply of 1,500,000,000 BAT.
Basic Attention Token is tackling a massive issue that has impacted absolutely everyone who has ever used the internet. With their new browser platform and associated token reward system, BAT is positioning themselves to become a major solution. That being said, converting users to a new browser is a massive endeavor and BAT will need to overcome many barriers to reach mainstream adoption.
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Disclaimer: The author(s) of this article may have a position in one or more of the securities mentioned above. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.