Builder Research - Basic Attention Token

I’ve recently started getting back into some blockchain development. A part of that has been digging into some projects to figure out where I might be able to help out, and just sharpening up my analysis when it comes to crypto projects. A vast majority of the info you find on the crypto sites is focused on the value of a token. I want to know what the state of a project is from the builder perspective though. Is this something I can build around or on top of to help create some value?

The Basic Attention Token is a pretty OG project. I suspect most of the folks who are interested in the project already know the broad strokes of what it was meant to do. But in case you somehow landed on this and you don’t already know about BAT, the super high level overview is that the token was meant to bring to the forefront the value exchange around attention that happens during advertising. Many of us don’t think about it, but when it comes to a lot of the business on the internet, we the users are the “product” that gets sold. It’s our attention (and the potential to divert that attention into commerce) that really drives most of the sites we use and think of as “free”. We normally aren’t aware of the big machine that’s trying to process our attention into dollars for someone else because it’s often intentionally hidden. And even when it isn’t hidden there are often so many stakeholders involved in what’s going on that it can be hard to unwind who is doing what and what data is involved. The Basic Attention Token was meant to simplify and make the value exchange explicit.

That was the high level pitch as it had existed a few years ago. And admittedly I haven’t followed it closely in the time since. I’ve tried to bring myself up to speed over the last month or so, and there might be some things I’ve missed in trying to figure out the current situation. But I’m pretty sure I’ve got the major parts right, at least as far as thinking about the token as a component of a development plan. The TL;DR is that the token itself seems to be in transition as Brave transfers to a different vision of how crypto and blockchain should fit into their overall strategy. If you’re interested in more detail than that I’ll try to lay it out.

The flow of BAT through the system is supposed to mainly be in support of creators. The central diagram on the BAT site shows a flow of BAT from both advertisers and users to creators. And the logo itself is meant to represent the relationship between advertisers, users, and creators in the system they’re trying to create. But it seems like that relationship has broken down under the current system.

In the original whitepaper the compensation paid out to the creators was meant to be an automatic outflow. The browsers would use directly instrumented time on property to figure out how much BAT should be directed to the publisher of a piece of content, and it would happen automatically behind the scenes. This was dropped as an option a while ago. I’m certainly not going to fault them for this no longer being the system in use currently. I could see there being some huge issues with this method of distribution.

In the absence of the automated contribution I did expect there to be a effective alternative. I pictured there being decent tools for supporting creators - maybe some tools for creators to drive the process on their own. In my mind that would be things like setting up ongoing contributions to your favorite creators, maybe tools for token gating some content, options to setup automatic BAT splits between multiple creators working on a collaboration. When I was looking at this part of the market a few years ago that’s the kind of stuff the crypto-forward creators were looking at. But so far I haven’t really seen evidence of activity on the publisher side. I’ve had a really hard time trying to size the outflow of payments to creators at all. There are lots of numbers shared on the BAT site, but amount of BAT paid out to creators isn’t one of the metrics. I would consider that core if the overall plan today is the same as it was originally.

So I just did some legwork. I figured of all the folks likely to have BAT contributions enabled, the blockchain and crypto media should skew higher usage. And since their audience is other crypto enthusiasts I assumed they would get some contributions. Figuring out how much usage there is for direct contribution is admittedly kinda hard. The BAT token was on the Ethereum chain to begin with, but it got bridged over to Solana to keep the costs down. That makes sense. And there are a bunch of custodial systems that were built into the Brave wallet to make it easy to sign up for the system and get users and creators onboarded. But what I was surprised to see was that the existing mechanisms didn’t smooth over the differences. I would often find someone who did have contributions enabled, but when I went to contribute to them I wasn’t able to because they’re on Uphold. That’s just broken. You have a user with BAT in the wallet you told them to setup, and a creator who’s asking for BAT to support their efforts, but it’s not possible to complete the transaction? If that main loop in the system isn’t working consistently it was hard for me to picture that the overall health was great.

The wallet I have setup on Brave is a direct Ethereum account though, so the few times I was able to get someone who was signed up as a Brave Creator and also had the right config on their side I was able to send them some Eth. And of course I could see the account I was sending to for those donations. There had been some other technologies in the mix at one point to keep users anonymous, but in this version at least we’re able to see each other for Eth donations. My system is obviously not scientific at all, but I just wanted to get something of a feel for if publishers were getting paid out at all. And from what I’ve been able to see, no. The few accounts I was able to get a bit of a view into had very low activity. In one case, before my donation the last deposit had been almost three years ago. And that was a pretty decent account with a lot of activity that I would have expected to be a highlight.

But the BAT token itself is doing pretty well in terms of price, so what does it really matter if the publishers aren’t ending up with the token? That happens because the Brave Rewards system has the token as part of the process. So advertisers on Brave need the token to be able to reward users, that puts the token in a pretty decent place compared to lots of others that don’t have any utility at all associated with them. That’s great for the price of the token, but not so much for the health of the ecosystem. For example, one of the big selling points of Brave is that it does a lot of ad blocking and stripping unessential content by default. (It really is a great browser by the way. It’s my daily driver browser and they’re doing great work over there, I just don’t think the BAT token is working). If your browser is stripping out ads that normally makes the content creators somewhat upset, cause they don’t get paid for the views of their content. If you have an alternative way for them to get compensated there’s a great answer to the content creators concerns. But if you’re both blocking ads and not really minding how the new system could be funneling them alternative value, there could be some issues down the line.

And there are some other efforts that seem a bit odd in relation to the core flow. Brave was encouraging a memecoin called Guano that rewarded folks for locking up their BAT. And they’ve made a partnership to allow for registering a .brave domain using your BAT. These things aren’t necessarily bad, but they don’t seem to be in service to the core mechanism the token is supposed to support. The cynical side of me would say they seem like the kind of thing I would do if I needed to increase velocity of the token and provide some utility exits for BAT that was pooling with users. But instead I’ll just say that these alternative ways to use BAT just further starve out the creators. There are a few posts on the community forum from creators who had been making some BAT for a while and have seem a pretty drastic drop-off recently. I wouldn’t be surprised if that drop-off correlated with the Guano launch. Why would users donate if they can earn from their locked up BAT? Especially when actually using the BAT to donate doesn’t even work a lot of the time?

So that’s my long winded version. Brave is open source by the way, the community seems to be pretty accepting. My hope had been that I would find something useful I could do to help out for the project. I know it’s not all on Brave to solve every problem on their own. However, with the core loop of the currency looking like it has stalled, I don’t think it makes sense to try to build with it. It seems like the roll of the token now is shifting to a new model. When I see the things like their domain registration partnership and native IPFS support I think maybe there’s another story starting to emerge around evening out access to infrastructure for folks underserved by existing providers. There’s been mention on the community calls of a revised roadmap coming up, hopefully that clears some of this up. I’ll cycle back around to it when there are some updates.