Despite being invented in 2008, Blockchain made big news in December 2017 when the price of Bitcoin Cryptocurrency surged past the $ 20,000 on the CoinDesk Bitcoin Price Index (BPI). This was also the same time, when we heard that Australian Stock Exchange would incorporate Blockchain technology for trade settlement. All this has created a lot of buzz in the digital industry about Bitcoin and Blockchain.
If simply put, Bitcoin is the digital coin (a Cryptocurrency) and Blockchain is the technology that enables digital coins or digital assets to move from one individual to another individual, in the safest way possible, without any third party involvement. In this post, we will only understand what Blockchain is and how it will transform the digital transactions.
The beauty of Blockchain technology is that it not only decentralizes a Digital Market Place but also makes that place tamper-resistant, transparent and incorruptible. Some of the notable features of Blockchain are-
Chronological recording of transactions occur in a distributed ledger that is transparent to its participants
Blockchain ledger is also encrypted so nobody can cheat by faking or changing the transactions
Blockchain includes agreed business rules, contract terms, and rationale that can also be programmed to automate transactions- ‘Smart Contracts’
Blockchain is an example of a distributed computing system that incorporates high Byzantine fault tolerance
Blockchain offers a decentralized consensus that makes it best fit for the recording of events, management activities, and transactions
Before going into the detail discussions of different digital sections that will get revolutionized by Blockchain, let us understand what the Blockchain is-
Satoshi Nakamoto invented Blockchain in 2008 for use in the Cryptocurrency Bitcoin, as its public transaction ledger. The invention of the Blockchain for Bitcoin made it the first digital currency to solve the double spending problem without the need of a trusted authority or central server. The Bitcoin design has been the inspiration for other applications- Wikipedia
In a simpler way, a block can be understood as a record of new digital transactions; be it Cryptocurrency or other Digital assets.
Once one block gets completed, it is added to the chain and hence a chain of blocks get created, which is termed as Blockchain.
Cryptocurrency used in Digital Transactions are encrypted and Blockchain records transactions with the help of Bitcoin miners who solve the complicated math problems to generate the private key for each transaction and to validate them as well.
Miners are also rewarded with Cryptocurrency.
The Blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.” – Don & Alex Tapscott, authors Blockchain Revolution (2016)
Now, time has come to understand how Blockchain will revolutionize the future Digital Advertising-
An essential thing in which Blockchain can offer the appreciable positive change is in the formation of Digital Rights Database that will resolve the issues related to Digital Rights Expression in media and entertainment industry.
Recognizing copyright of a song, tune or content and characterizing how royalties ought to be split amongst musicians, entertainers, distributers, makers is troublesome in digital space. We regularly see different royalty related court cases due to the confused copyright conditions.
The immutable ledger system of Blockchain guarantees that no single entity of the complete network can ask for their ownership will resolve this issue.
Blockchain can store secure files with all relevant information such as composition, lyrics, cover workmanship, license, etc. in an encoded and well-encrypted form ensuring the perennial existence of those records
Blockchain technology also offers the ‘Smart Contracts’ facilities that facilitate automatic payment of royalties
The “Tiny Human” song of British singer Imogen Heap released on Ujo Music, which is a Blockchain powered site. It lets the users not only buy the song but also the tempo, key, and stem of the track via Cryptocurrency Ether
Smart Contract was encoded in the Blockchain that channelized the royalties directly to the producers, writers, singer and other stakeholders without any need of intermediaries, and with full transparency
In Digital Advertising, notwithstanding the capacity to target and customize Ads, we spend around 40 to 70% of our Ad investments to the intermediaries and the reason is the current Digital Advertising system does not have the needed transparency. Blockchain-based Ad Exchange platforms for Digital Advertising helps publishers and advertisers exchange efficient and transparent advertising contracts.
NYIAX recently developed a Blockchain based Ad Exchange platform in partnership with NASDAQ, and its Chief Product and Technology Officer, Richard Bush says while talking about the deployment of Blockchain technology-
With valuable experience in capital markets, NYIAX has a long-term vision to create a more financially rigorous model leveraging fin-tech best practices with advertising and media.”
Madhive is another company that is deploying a Blockchain based Ad exchange for its digital video content sites. Adam Helfgott, CEO of Madhive says,
Our platform enables ad-based monetization of video in a secure privacy-compliant way so a viewer’s private information is shared only with an artificially-intelligent agent that pulls in relevant ads.”
Undeniably, we all live in Digital Society because of which Digital Identity is one of the most important phenomena in today’s time. Blockchain gives the technology to incorporate security and trust into the Digital Identity applications. Blockchain-based Digital Identities take into account the storage of a great deal of individual data, and in addition, offer the vital link important for the transfers of Digital Assets. Three examples where Blockchain based Digital Identity is used are-
Blockchain-based Digital Identities that augment Personal Credit Score for property buyers. This would offer Smart Contracts with full property details along with buyer’s Digital Identity for property auction on Blockchain for the financiers.
In online shopping, Blockchain based public profile can be used to demonstrate your trustfulness with a Know Your Customer (KYC)/reputation management system. This also helps in classical identification of data with the help of more qualitative and quantitative information.
Digital identity in the food chain with a Barcode and Blockchain information linked to it will disclose the complete and verified trajectory of the product.
People nowadays are being increasingly vigilant about their privacy, that is why worries over the information gathered through web search tools, and smart devices are at a record-breaking high.
It is not a mystery now that Google and Facebook sorts of companies are making a fortune pitching client information to organizations that require insights of the customers, while clients are not qualified for any of the benefits produced using these deals.
Because of the usability and free nature of Search Engines, Social networks, and email services, huge measures of personal information are gathered and shared, and clients have no control over such sharing. Therefore, a substantial number of individuals are not happy with the techniques that are being utilized to gather the personal information and they want to have control over which information, assuming any, can be shared to outsiders.
Blockchain technology is one of the most efficient solutions for all such issues.
To upgrade the privacy information security and to enable Digital Media Users to recover the control of their own personal information, Blockchain is considered best.
Blockchain technology can bring a level of transparency into the data and information space that is at present not accessible to Digital Media Users
Blockchain is a decentralized record and it is changeless, straightforward and effortlessly auditable that empower clients to have control over their information
You can decide what information is being shared and who it is being sold to
This also creates a revenue-generating model for Digital Media Users who will be directly compensated for the individual information that they share
Blockchain startup BitClave is an example of decentralized Search Engines that offer Blockchain based privacy to its users. About its working framework, the company says,
“BitClave is the next generation of search data privacy. You should have control over who can use it — and how. Our decentralized search engine helps you truly find what you’re looking for and get compensated for your data, making third-party advertising networks unnecessary. Powered by Blockchain, you can rest assured your data is protected.”
Approximately, when we spend 3$ on Digital Advertising, our 1$ is lost to Ad frauds. The estimated Ad loss because of Ad frauds by the end of 2017 was around $16.4 billion.
The Digital Advertising space is laden with misrepresentations. Companies are generally unfit to evaluate if the Ads they place and pay are offering the real conversions or not. Likewise, it is misty what number of perspectives and clicks of the online Ads are actually created by bots.
Blockchain technology can resolve all such problems and ensure better transparency and accountability. You can record your Ads on the Blockchain and hence can guarantee that the Ad Metrics are verifiable.
The Blockchain technology can record how often the advertisement was seen and what was the nature of the traffic that is coming to your Ad
Actualizing Blockchain technology is probably going to lessen the rate of Ad frauds and prompt advertisers to get the actual value for the investments
To battle against Digital Ad Frauds, a Los Angeles based tech startup MetaX is among one of the first to bring the Blockchain. The company has built up the first protocol AdChain as Advertising Supply Chain that utilizes Blockchain technology to record and store all the ad impressions in real-time. This helps advertisers know that they are only paying for those Ads that are being seen by real people
Influencer marketing is the new trend in Digital Marketing landscape. Influencers enjoy a large Social Media following and brands pay them in an effort to influence some of their followers to those brands. Terms of contracts in Influencer marketing vary a lot and that is why Blockchain-based smart contracts can be used for reducing the potential conflicts, which may arise during cross-promotional engagements in Influencer Marketing.
Blockchain-based smart contracts automatically pay the influencers once they publish the agreed-upon promotional content
The terms of contract and payment obligations are coded in the Smart Contracts and thus Smart Contracts will remove all kinds of potential issues that may arise in between the advertiser and the influencer
Blockchain also ensures frictionless Monetization of Digital Content that removes the piracy problems in digital distribution.
Blockchain Thought leader, Phil Gomes says-
I personally believe that a lot of piracy comes from friction in the legal distribution mechanisms. Blockchain technology can enable more frictionless monetization of content to better compete with pirates.”
By including Blockchain technology into Digital Media & Advertising- advertisers, content creators, businesses, artists, distributors, and sponsors would all be able to make a profit.
In the event that you are in advertising, media, and entertainment, your industry is for sure in dire need of this technology- And that is why, 2018 is going to be the year to monitor, experiment and invest into Blockchain technology.
Share your thoughts and queries related to Blockchain Technology in comments below.
Author: Shivendra Tiwari, Engineer by Education, Marketing Influencer by Profession, and Creative Writer by Passion- Shivendra is involved in Branding, Advertising & Consulting in the domain of Digital Marketing over the years. He relies upon his Digital Marketing learnings and uses the creative DNA for composing blogs that have the applied zeal to engage, entertain and inspire the readers- to Connect- Convince- Convert their target audiences via different digital media channels.