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BAT, or Basic Attention Token, has been rumored to completely overhaul the digital advertising space as we know it. Advertisers and publishers have long been battling ad fraud and users are getting tired of being tracked and bombarded with unwanted ads. So what’s the solution? Blockchain-based digital advertising.
Explaining Ad Fraud
Before we explain the Basic Attention Token in more detail, it makes more sense to look at why the BAT has been developed first. Digital ad fraud is unfortunately far more common than one might think. Between ad stacking, bots, fake users, and many other nefarious ways of producing illegitimate results, ad fraud leaves users, publishers, and advertisers feeling frustrated.
Here is an example of one way that ad fraud wreaks havoc in the digital ad world…Let’s say a business with a website signs up to get paid for every 1000 views of their site. A bot refreshes the page to drive up the number of views or “impressions”. When it reaches 1000 views, the advertiser is still charged for the view even though there was no chance that the users who viewed the site were ever going to buy anything from the site. For businesses that display ads, ad fraud can increase conversion costs until it’s no longer profitable to run ads anymore.
Who are the Victims of Ad Fraud?
Ad fraud affects companies and ad agencies all the time because the ad agency can report that an ad campaign was a success, when in fact, the results were muddy at best and illegitimate at worst. For example, very high ad viewability sounds like a good result on its own. But if you look more closely, high viewability with a zero increase sales is usually a sign of ad fraud. Meanwhile, users like us are overwhelmed with aggressive and invasive ads. Not to mention, we suffer from slowed down devices because of tracking software.
What is a Basic Attention Token?
It is important to note that BAT is not a currency in the financial sense, but rather a utility token. According to basicattentiontoken.org, the tokens “do not represent or confer any ownership right or stake, share or security or equivalent rights, or any right to receive future revenue shares, intellectual property rights or any other form of participation in or relating to the BAT platform.” BAT can be stored in any ERC20 compatible wallet.
Plans for BAT
The plans for using BAT are still developing. The main usage will be integrating it with the Brave browser. This is already in full swing, but we will get to that in a little bit. Other uses could include paying users to view ads in messenger apps like Telegram or incorporating it into WeChat’s system of bots and payments. The future capabilities of BAT have much potential and look very promising when comparing it to how it has been utilized already.
How can BAT help?
BAT can revolutionize the digital ad space because it is based on blockchain technology. If you remember from our earlier post, blockchain technology relies on a public ledger that does not have one single owner. Which means that fraudulent activity will be virtually impossible to conduct because each node in the blockchain has to check and approve each transaction. So how can it help with ad fraud? A common situation that occurs in digital marketing is that a marketing platform, publisher, and advertiser all claim a different amount of impressions (likely due to fraudulent activity). So which of those three has the most accurate data? The answer is unclear. Blockchain technology will prevent this issue because the network will verify every transaction. Sounds good in theory, but how does it work in practice?
Introducing the Brave Browser
Everyone has their favorite browser with the popular ones being Chrome, Firefox, or even Edge. But imagine a new browser that completely blocks ads and takes privacy to a whole new meaning. Welcome Brave Browser, the free and open source browser with an ambitious future. With a tagline that says, “You are not a product,” the Brave browser has a plan for eliminating malware, trackers, and fraud. Its plan, according to Brendan Eich, will be fulfilled in two stages.
Stage one is to block ads and trackers and reward sites based on user attention. Stage two is to move towards decentralized ad exchange and introduce a new currency. This is where the BAT comes in. The utility token can be earned by giving attention to ad content or anything else the users spend time looking at. So the publishers will receive ad revenue in the form of tokens and users receive tokens for viewing ads.
For publishers, their revenue will increase leaving behind inefficiencies. Advertisers will be able to better target their audience and increase their ROI. And lastly, users can enjoy their privacy on top of earning revenue for their attention. The beauty of the BAT is that it is fully integrated with the Brave web browser. As of mid-January 2019, the company has officially moved into stage two by enabling ads in beta version 0.60.
BAT on Youtube
The Brave browser has already implemented BAT into Youtube. Users can donate BAT to their favorite Youtubers. With this system, the browser logs viewing time on behalf of the content creators, no matter which site embeds the video.
How are the BAT tokens distributed?
There is a total limit on BAT tokens, which is 1.5 billion
Advertisers will pay BAT to access users’ attention. Users who opt-in to ads will receive BAT for their attention. They can use their token in a variety of ways including selling it or using to access Brave’s premium services. Publishers who display ads will earn BAT for their high quality, relevant ads.
An important point to remember is that BAT wasn’t designed to be bought and sold in the same way as other currencies. However, as of late 2018, Coinbase Pro officially approved trading BAT. At this time, besides Coinbase Pro, other major exchanges are trading BAT as well.
It will take some time for digital ads to be fully blockchain based. While blockchain platforms are an exciting prospect for advertisers, it will take an entire industry to make the switch for the situation to truly change.