pull down to refresh

The Problem of Using Attention as a Currency
92.6k sats \ 50 comments \ @dergigi 25 Nov 2022 bitcoin
The internet never had a native currency, so it had to use a surrogate: attention.
Due to the lack of a digital native money, we had to use credit (IOUs) to send money electronically. Fraud & chargebacks made micropayments impossible.
Two models evolved:
  1. "You are the product", which uses attention & user data as a currency
  2. "Subscription hell", which uses credit IOUs, which requires full control & KYC, and doesn't allow for micropayments (it's always ~$5 or more, nothing else would be profitable)
You can monetize some services outright: storage and compute are easy examples, because they are scarce. JPGs, however, are not scarce. They can be reproduced at zero marginal cost.
Because reproduction is free, a digital image or a piece of text can't have a market price. It can't emerge, because supply is infinite. I can crush the paywall and distribute it for free. We have to disconnect price from value, and we have to think about both differently.
Bitcoin ⚡ fixes this.
I believe that, in a value-enabled web—a web that does facilitate the free flow of payments, in addition to the free flow of data—new models will emerge that are not bound to selling eyeballs and outrage. We should use money as money, not attention.
Of course, this is already happening. The obvious examples are:
  • Podcasting 2.0, lead by the Podcast Index,1 which allows for value-enabled podcasts.2
  • Stacker News, which uses a slightly different approach: every action has monetary value attached to it, making bots uneconomical.
The thing about monetary value is that it is human action distilled. Many signals can be faked or auto-generated, be it views, downloads, comments, and even content and profiles. In other words: talk is cheap. Sats are not.
This is Day 2 for the Internet. It's still Day 1 for Bitcoin. ...and Day 0 for the Value-Enabled Web.
A lot of people are trying to solve the conundrum the internet found itself in:
  • Elon wants to fix it.
  • Jack understands these problems deeply and has the right ideas when it comes to fixing them.
  • Saylor understands that cash money brings real consequences and real cost to cyberspace,3 which is one piece of the puzzle.
  • Daniel understands that we have to get the identity piece right, without having to rely on trusted third parties.
  • Snowden understands these problems and is on the right track, and like him, I am optimistic that we will be able to fix them.
"I'm thankful for the Internet. One day it will be free and open, edge to edge." —Edward Snowden
Central control doesn't fix this. A new platform doesn't fix this. Protocols do. In addition to using the right protocols, we have to fix the incentives. And for that we have to fix the money.
Bitcoin is fixed money.
Digitally native money—money that is not credit—is a big deal. It is a big deal because infinite velocity of money is a big deal, and the removal of counterparty risk is a big deal. There is a reason why cash is king.
And when it comes to monies, Bitcoin is the king of kings.
Originally published as a twitter thread. Also mirrored on dergigi.com/attention
Footnotes:

Footnotes

  1. Join podcastindex.social and chime in! ↩
  2. Visit value4value.info to learn more. ↩
  3. Listen to Saylor on the Bitcoin Matrix. I'd recommend you listen on Breez or Fountain. ↩
write
preview
related posts
936 sats \ 19 replies \ @dergigi OP 25 Nov 2022
Would love to hear everyone's thoughts.
Also: if you want to help fix this shit—with code, open protocols, and new business models—let me know.
reply
480 sats \ 12 replies \ @jimmysong 26 Nov 2022
I came to this conclusion back in 2014-15. The internet runs on ads because no micropayment solutions existed when it got started. The payment amounts are so small that you can't do real payments, you have to do ads.
I actually spent some time with another Bitcoiner looking to do a startup on coming up with an alternative. At the time Lightning was nascent, but we realized then that this could be the solution.
Here's the problem. The amount of attention you need to give to figure out whether you want to pay 1/30th of a penny is not worth 1/30th of a penny. This is why subscriptions are so popular. It reduces the decision fatigue you're likely to get from having to decide every time whether a song, a book, or a podcast is worth paying for. And this is where you start running into problems.
You need some automated way of making these sub-penny decisions. And that requires a lot of code. I'll pay for articles that my friends recommend, which has a keyword that I'm interested in, or has a certain ranking on stacker news, etc. These are not easy to write and every person is going to have a different one. Heck, some people, especially people with a lot of time on their hands, will totally be willing to watch ads instead of paying 1/30th of a penny.
That's the hard part about microtransactions. The decision has to be with the user but too many decisions fatigue the user. Thus, you need a second brain that's very like you to make those decisions on your behalf. Writing that is very, very hard.
Hence my thought that it's going to take a long time to replace ads.
That said, there's at least one way which can work and that's offering to pay websites the ad revenue they would get and not showing you the ads. The problem is there's no way for you to know how much they would have made so it's easy for them to lie.
Some random thoughts, but this is not an easy thing to solve once you dig into it. Decision fatigue is real.
reply
3 sats \ 3 replies \ @dergigi OP 26 Nov 2022
I agree, this is a big problem, and one of the reasons why paywalls don't work.
I am aware of the mental transaction cost problem and I wrote about it at length here: https://dergigi.com/2021/12/30/the-freedom-of-value/ (CTRL+F "MTX problem")
Podcasting 2.0 shows that payments can be invisible. I think the challenge is both on the user-experience front, and on the business model front: no paywalls, voluntary support. I think the success of Substack (and Patreon, and Twitch) shows that this is a viable model.
Thanks for sharing your thoughts!
reply
26 sats \ 2 replies \ @jimmysong 26 Nov 2022
Here's the other thing, though. Ads are also unsustainable! I wrote a thread about how AI is going to destroy the ad model a few months back: https://twitter.com/jimmysong/status/1577934190540165121?s=20
What this tells me is that there's a real opportunity for entrepreneurs to figure this out and I suspect Lightning will be a big part of it.
reply
10 sats \ 0 replies \ @dergigi OP 26 Nov 2022
I agree, as does Adam Curry. He talked about it at length in the V4V panel discussion that NVK hosted on Bitcoin Review a few nights ago.
The attention economy is broken, it leads to clickbait, polarization, and maximizes outrage and addiction.
The advertising model is broken for most; it doesn't fatten the long tail, and if successful it often leads to self-censorship. Incentives are messed up too, most of the time.
What this tells me is that there's a real opportunity for entrepreneurs to figure this out and I suspect Lightning will be a big part of it.
100%
reply
0 sats \ 0 replies \ @joemartinmusic 28 Nov 2022
isn't advertising only as good as the quality of data linked to a real identity..? As people become more privacy conscious and careful with whom they share their data, won't this impact ad revenue models..? Seems the longterm solution to this is self hosting of the content you want to give away on a personal server and then use the V4V model where people can access it for free or stream sats as they stream the conent from your personal server. Guess if it was really popluar though, it might not handle the bandwidth. I don't know enough about this... What are your thoughts Jimmy..?
reply
4 sats \ 5 replies \ @timechain 26 Nov 2022
I hate to say it, but Brendan Eich's (Javascript, Mozilla Firefox) Brave & Basic Attention Token (BAT) model was interesting. Of course it didnt work because they made a shitcoin. But they came up with an interesting idea. Imagine instead of a sats/min, (like Fountain) a total sats/month, (like Brave/BAT) and the app figures who gets how much of it.
You earned the BAT tokens... by watching ads of course, but in this model, only Brave learns stuff about you, and tries to block trackers and cookies, giving you tokens to give out to support creators.
Websites and content creators registered. You set an amount of BAT tokens per month to give to all creators you visited during the month, and at the end of the month, it would distribute to "Brave Creators" in proportion to the amount of time spent there.
Of course in the end, both your browser and the websites were still spying on you and Brave found a way to print money. But the setting a monthly amount and it being dispersed by time spent was an interesting idea for a few years ago. It fights the "mental cost" by being something you only set once and forgot about. It even funded itself. (Thru "tokenomics" (a ponzi) and a few advertisers.)
reply
0 sats \ 0 replies \ @joemartinmusic 28 Nov 2022
does it all come down to the platforms hosting the files having overheads and costs of servers, electricity, employees, brick and mortar etc. Would this change if there was a way to self host your own content on a personal server and a platform for people to serch it somehow and listen/ read/ view from your personal server to their device. That way, the content could truly be FREE (as in beer), because you're baring the costs involved with hosting..?
reply
0 sats \ 0 replies \ @criptopanas 28 Nov 2022
I found the browser extension AddSlice a good way to earn SATS for mi attention. It's like Brave but with Bitcoin instead a shitcoin.
reply
0 sats \ 2 replies \ @dergigi OP 26 Nov 2022
Yes, it was the right idea (or at least going in the right direction), but creating your own currency for it is unethical, of course.
The Gab/Dissenter guys created a fork a while back to replace BAT with sats, but I think it was discontinued. Used to be called Dissenter browser, I believe. Imho it was too early. I'd love to see another effort now, or soon.
reply
1 sat \ 1 reply \ @timechain 26 Nov 2022
Yeah I heard about Dissenter. I like the idea of a (uncensored) comment section for anywhere on the internet. With an interoperable comment section being a thing for podcasts through the Podcasting 2.0, I wonder if we will see the same thing for everywhere online.
I think the "pick an amount for the month to give and let it be distributed in proportion to the time you spent on each site" method might have been a good idea. Maybe Alby will try it, although they kinda seem more like a Bitcoin Metamask than a Bitcoin Brave Browser. But maybe they will try it.
reply
321 sats \ 0 replies \ @dergigi OP 28 Nov 2022
Alby has allowances per site; I'd love to see a global one. Hard to do in a way that won't be gamed/abused, though.
https://getalby.com/website/_assets/landing3-F7XZJDM4.webp
reply
1 sat \ 1 reply \ @gandlaf21 26 Nov 2022
Yeah i think deciding about micropayments lead to fatigue. Maybe a solution would be to meassure the content consumed (e.g. scroll percentage on a page, seconds in a video) and then give an estimate/recomendation based on that which can be overruled by the user
reply
10 sats \ 0 replies \ @dergigi OP 26 Nov 2022
Did you ever use any of the new podcast apps that are value-enabled, and do exactly that?
Check out Breez or Fountain if you haven't yet.
reply
23 sats \ 0 replies \ @kr 25 Nov 2022
love the concept of using bitcoin instead of attention as a native currency of the internet
reply
1 sat \ 0 replies \ @02000d4de7 26 Nov 2022
I'm in - ads and subscriptions should be replaced with micropaymentals, as well as like buttons and so on. That's why we're making donate4.fun. but at the same time, we need to modify recommendation algorithms, because in a decentralized web it's much easier to cheat on them and promote your content just by paying
reply
1 sat \ 0 replies \ @Kaffi 25 Nov 2022
are you interested in teaching? I'm a software engineer but open source dev seems so foreign to me.
reply
1 sat \ 1 reply \ @chairman_pretense 25 Nov 2022
Thoughts on an open source App Store? Too few FOSS developers getting paid because managing the (global) money is too complex. Apps for sats fixes this - Flathub on lightning?
reply
1 sat \ 0 replies \ @dergigi OP 26 Nov 2022
App developers should include themselves in V4V payment splits, yes. Lots of room for experimentation & new models.
reply
0 sats \ 0 replies \ @why 27 Nov 2022
This is such a rich thread, thanks for starting this conversation. I could see the inspiration for a wildly successful business model launching right here. Lightning-enabled Wikipedia is great; also really love what SN has done by converting the like ❤️ to a micropayment ⚡️. What other models (Youtube, IG, Vine, TikTok) could be upended simply by supplanting, or augmenting, the like button?
reply
1012 sats \ 2 replies \ @Lemon 26 Nov 2022
Do you view Wikipedia as Value for Value?
Based on the number of emails I receive from them and the pop ups on their page for donations, they seem to be on the brink of considering advertising as a source of revenue if they are unable to reach their donation goals.
I’m very curious to understand why you feel this isn’t working for Wikipedia now.
Why aren’t they doing better? Wikipedia clearly adds value to the world.
Is it because of payment friction like VISA transaction fees and entering in card information?
Is it the UI because we can’t boost posts like Stacker?
Is it poor incentives because authors aren’t proportionately rewarded from donations for their writings and research?
How do you think about this?
reply
10 sats \ 0 replies \ @phaedrus 27 Nov 2022
1k for great question! Wikipedia is a great target for v4v. How can we experiment with it?
Maybe enable LN payments through Alby, at least for some subsection like stuff related to Bitcoin? (Most people don't have any LN wallet setup so paying sats is harder for them than stupid credit cards)
reply
0 sats \ 0 replies \ @dergigi OP 28 Nov 2022
Great question.
Wikipedia is an interesting case study. It worked well in the past, but I would argue that it now suffers (and has for some years) what Warren Buffet called "the institutional imperative."
It used to be a very lean organization, and now is anything but. There are some interesting answers as to the why of this bloat. But many people agree that—again, for some years now—Wikipedia has cancer.
Personally, I would love to see a move away from "Siren Servers," towards something that rewards people monetarily, i.e. something along the lines of programmatic V4V splits. I believe it would solve some of these problems, but it probably will also introduce new problems. That's just how these things go.
In any case, I'm so bullish on V4V on Lightning in particular because of its directness and transparency, which should—at least in theory—reduce administrative and other bloat.
reply
152 sats \ 4 replies \ @pi 26 Nov 2022
During his chat with Elon and Cathie Wood, Jack said that Twitter would have never chosen the advertisement model, had Bitcoin already existed when they launched the service in the early-mid 2000s
reply
1 sat \ 3 replies \ @dergigi OP 26 Nov 2022
Source?
reply
6246 sats \ 2 replies \ @timechain 26 Nov 2022
Looks like he was paraphrasing a bit...
At about 42:20
reply
0 sats \ 0 replies \ @dergigi OP 26 Nov 2022
Thank you 🙏🧡 A Moscow Time worth of sats for you good sir.
reply
0 sats \ 0 replies \ @pi 26 Nov 2022
Thanks for clarifying this. 😅
reply
50 sats \ 0 replies \ @TheBTCManual 26 Nov 2022
I work in advertising and I've played with v4v and I definitely think it has a future in the economic stack, paywalls are rubbish without micropayments, you have to sign up, you have to provide contact details, pay a subscription and you dont get the full value, you just get a bunch of things you don't value simply because you wanted to read a few articles or see some of a persons content
That's where I think v4V thrives as well as in the pay to consume, videos, podcasts and even written content can be charged on a view/listen/scroll depth which not only makes it affordable for more people to consume, but gives creators more signal on what people like and what they dont
I do think advertising will always be part of the stack, its keeps alot of the internet afloat its a multi billion dollar industry but where I see private key cryptography falling in there, is with something like LSATS and slashtags. Whats currently happening in advertising is high LSM people who keep the model worthwhile, are falling off, they're becoming numb to ads, using ad blockers, not using social media as much, and becoming harder to get.
By having a unique identifier not tied to your PII (personally indefinable information) like an LSAT or slashtag, you can create an opt in ad network and a granular bidding market, it gives advertisers the chance to pay sites and services that attract high-quality users a premium and entice high LSM users with better deals because the margins on their products would make up for it.
reply
198 sats \ 0 replies \ @joemartinmusic 28 Nov 2022
great article Gigi! As you know, I'm here for this and will be incorporating a value for value model in every music release I do going forward. I want to try and popularise the phrase 'streaming 2.0' which could encompass music and film as opposed to just 'podcasting 2.0'. The economics of music making and podcasting are very diferent though. I will be bringing attention to this when I release my next song as people might find it interesting. I'm still waiting for a way to bring my current fans into the V4V economy. There needs to be an easy onramp like Strike where people don't even know that they're using lightning but still have that instant lightning experience with no lower amount. People won't buy some sats on an exchange with KYC, open a lightning channel just to tip 10p for a song... Until the barrier to entry for the average person is lowered considerably, adaoption will be slow. Let me know your thoughts
reply
23 sats \ 5 replies \ @premitive1 26 Nov 2022
I agree with most of what you say. Especially regarding the potential for p2p. but I think it will take time and a continuing shift in social values
reply
107 sats \ 0 replies \ @dergigi OP 26 Nov 2022
I agree, it will take a lot of time. This has to grow organically, and it has to be a change in behavior both from the creator and the consumer side.
Adam Curry is leading the way with Podcasting 2.0 and the Value4Value concept.
I think the time is ripe to do something similar for the web at large, hence the Value-Enabled Web idea.
Browsers should be able to parse value information (like lightning addresses, etc) and enable value flows natively. Alby is on the right track with the introduction of Lightning meta tags for HTML and so on:
https://getalby.com/website/_assets/code-YNBT4BTR.svg
reply
92 sats \ 3 replies \ @inevitable 26 Nov 2022
It will ALL take too much time, it seems to me. Too much for me at least. I desperately need a new mindset, framework to find a purpose in the world that is too slow for what I dream and hope to see in my lifetime. I believe in afterlife, so I will see it all from up there in the end - and this is uplifting. But still it's hard to live day by day in this world, where it seems I was born too early.
reply
43 sats \ 1 reply \ @premitive1 26 Nov 2022
if you believe in an afterlife then consider the potential that you were born in the right time to play some important role in the creation of that world you expect to see well after you pass from this existence. What could you build that you aren't yet? Or what are you building that you haven't finished yet?
reply
2 sats \ 0 replies \ @inevitable 26 Nov 2022
Thank you.
reply
56 sats \ 0 replies \ @dergigi OP 26 Nov 2022
It's all happening very quickly in the grand scheme of things. Not too long ago Lightning was just a proposal. First Lightning Conference in Berlin, 50% of payments didn't work, even though everyone knew what they were doing. Now I'm receiving streaming payments every minute, and Lightning payments rarely fail, if ever.
Podcasting 2.0 exists. Lightning Addresses exist.
Soon we'll have recurring payments (already works if you use Oak) and hopefully reusable payment codes that work without a server, ala BOLT12 offers.
I'm confident that amazing things will happen in the next years. ⚡🧡
reply
1 sat \ 5 replies \ @sommerfeld 26 Nov 2022
I see the appeal of v4v but have my doubt if it will scale to support all the services we have today.
It can be complementing, no doubt.
I'm seeing many competing interesting visions for a new better web, this one of them.
Nostr and holepunch/slashtags are other possible paths that do not depend on bitcoin structurally but play well with it.
The future is exciting!
reply
22 sats \ 4 replies \ @premitive1 26 Nov 2022
value4value doesn't make sense for all exchange, but it makes a lot of sense for certain forms of media creation, like podcasts. A hollywood style feature film might never come out of the v4v model, but it might move us in a better direction than the rent-seeking business models of today
reply
73 sats \ 3 replies \ @dergigi OP 26 Nov 2022
Exactly. It doesn't make sense for an apple. But it makes sense for a picture of an apple.
Because reproduction is free, a digital image or a piece of text can't have a market price.
Digital artifacts can be reproduced at zero marginal cost. Regular pricing models don't make sense. This book got the problem definition right, but not much else I'm afraid.
reply
13 sats \ 0 replies \ @sommerfeld 26 Nov 2022
Thanks for the reading suggestion, looks interesting.
reply
0 sats \ 1 reply \ @premitive1 26 Nov 2022
I added to a reading list, but found it a little ironic to our conversation that he sells the digital copy of the book for $13.99!
reply
52 sats \ 0 replies \ @dergigi OP 26 Nov 2022
Yeah, don't buy it. (Or buy the physical copy.) It's not great, I just wanted to point out that this is a known problem and there is a lot of prior work in regards to the problem definition.
V4V is a behavioural solution. Lightning allows for a technical solution.
I think wedding and extending both is the way.
reply
0 sats \ 0 replies \ @selfish_gene 28 Nov 2022
стоит подумать над тем, чем является биткоин. это вирус или антивирус? если он побеждает все вирусы в виде фиата то это антивирус. если появиться кто то, кто сможет превзойти биткоин. значит биткоин вирус.
reply
0 sats \ 1 reply \ @phaedrus 27 Nov 2022
Yep, this is happening!
Reminds me: Will Lightning replace ads? #4604
reply
0 sats \ 0 replies \ @phaedrus 27 Nov 2022
I think it will be important to pick the right markets to develop these ideas. SN seems great because it's mostly bitcoiners and thus setting up LN wallet is low overhead.
I wonder, what are other market areas to bootstrap this?
reply
0 sats \ 0 replies \ @siggy47 26 Nov 2022
We are lucky to have access to this material.
reply
0 sats \ 0 replies \ @peterzion 26 Nov 2022
https://cointelegraph.com/news/ftx-crisis-likely-to-spark-a-domino-effect-macro-analyst-explains
reply
0 sats \ 0 replies \ @Soldmychairs 26 Nov 2022 freebie
Subscription hell and KYC is nothing less than disrespect towards the customer. I, as a potential customer, am offended by them and often cancel transactions I find intolerable.
Using cash and trust to transact is so much more lubricated. I’ve bought Maple Syrup from @beisnerds with bitcoin and it was the best internet buying experience I’ve ever had. I send cash and shipping address, you send the product, easy. And nobody else needs to know about it.
Yes it requires a little trust aka risk, but people should learn absolute safety is an illusion and there’s risk inherent in everything. The most I’m risking in my tx is the price of the product without compensation in the form delivery of the product.
Bitcoin doesn’t need to fix the problem of people lying to each other, it just needs to be a better money. Mission accomplished.
KYC and subscription customers risk much more in the form of stress, hoop jumping, and private information leaks.
0 sats \ 0 replies \ @02e2a7777a 26 Nov 2022 freebie
Talk is Cheap, Bitcoin is Not https://thepathtobitcoin.com/2022/10/06/episode-57-talk-is-cheap-bitcoin-is-not/ reply
0 sats \ 0 replies \ @DolisDumitru 26 Nov 2022 freebie
https://app.noah.com/?referralCode=PurpleBrain13
Lightning wallet that helps you to transfer sats from lightning to on chain with 0 fee. Worth trying it.