Money Has No Memory

I’m still trying to grok the whole blockchain thing, and to come up with use cases distributed apps, or dapps as they're called. I realized one way to approach the subject is to consider the limitations of regular currency in the digital world.

A torrent is a file download that distributes the work among several servers. E.g. instead of downloading a 500mb file from one computer you get 1mb from 500 different computers. That's called a *distributed* system. Blockchain technology uses a similar P2P system to maintain the encryption on a public ledger that is constantly growing. Most of us are familiar with blockchain’s use for issuing and managing coins, or cryptocurrencies, but that is just the tip of the iceberg.

Ethereum uses this blockchain ledger to turn contracts into code - imagine buying an item online and having the funds held in escrow until a tracking number is uploaded to the blockchain at which point the funds are automatically released.

EOS - the Epic Operating System - doesn't just host information in this distributed cloud, it hosts software. And not just software but programs running on an amorphous host.

To back up a bit, sometimes I recall the heady days of the early internet when Gnutella and Napster broke into the scene. Before RIAA lawsuits scared us into submission, it was like the wild wild west. Napster was a public repository of every song recorded. All downloadable for free.

In a way, I think that’s what today’s Internet is like - traveling to and from websites is free. For the most part, everybody is giving everything away. You rarely find sites that charge a subscription because a site that charges an actual subscription must A] provide superior content, B] provide enough superior content on a montly basis to justify the cost of subscription, and C] set a high enough subscription price to maintain profitability.

In other words, a website that has one killer story every month can’t charge $4.99, nor is it feasable to charge 0.75¢ per month. The other way to monetize the site is with web ads which are currently the Internet’s version of sharecropping.

Napster’s demise resulted in a one-way shift of power towards centralization. The big players get more. With a decentralized Internet the flow of power will go both ways. It’s like a solar panel installation with net metering, your account will get credited or debited depending on your usage.

When I look to the the future of the Internet I think of millions of small toll gates set up. Every page costs something, even if it’s just a satoshi. On the other hand, if your browser is set up to accept advertisments, you may be able to get paid. I’m talking negligible amounts here, ten cents a day in browsing fees, maybe a dollar a day in ad payouts.

The cost of a web ad will be a split revenue profit sharing between the site hosting the page and the person viewing the ad. Sales that result from web ad click throughs will generate credit kick backs to the page showing them.

This is what the next iteration of the Internet will look like: Websites like Facebook replaced by sites that exist on the computers of the people using them. By contributing to the website you increase your stake in it, and thereby become a more trusted source, receiving more 'gas' (nominal tokens that grease the wheels).

And the reason why this will sound the death-knell for Facebook is because YOU will still retain ownership of all the media that you upload to the site.

A lot of people say MLM is a scam. It’s unfortunate that 99% of MLM companies are scams, but MLM itself is not a scam. MLM is simply a mechanism for growing a sales force while giving proper credit where credit is due, not just on current sales but also for future sales. I believe in tomorrow’s Internet these credit relationships will persist far beyond where they end today. They will become durable.

In the future when someone makes an online purchase the webpage that directed them to the store will get a percentage of the sale, the person who tweeted the link to the webpage that the customer followed will also get a credit. And when that customer returns in two months for another purchase all of those credits will be repeated.

And that’s why I say money has no memory. If you were to try to set up this network of relationships and then attempt to issue credits based on digital dollars and cents you would lose your mind, because the credits are on a separate ledger from the relationships. IF ONLY the relationships between the network nodes was BUILT INTO the currency for these credits. If only the currency could remember that every time a dollar gets spent by this customer on this webstore that 0.00017¢ goes to @bondibox for tweeting the link that sent them to the store in the first place.

Aside from the mechanics of distributing the proper credit, this micro economy can’t come to life because it’s impossible to charge someone a fraction of a penny.

An internet brimming with tokens will monetize absolutely everything.

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edg's picture

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I hate Steemit.

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"Religion is what keeps the poor from murdering the rich."--Napoleon

to monetizing everything. It's been the ultimate objective of TPTB for quite some time. They aren't on my side. The primary objective seems to be to get people to pay for something they used to get for free. For most of my life my TV could receive 4 channels. Advertisers paid the cost for the opportunity to show their wares to viewers.

Now I have cable and more channels than I'd care to count. I still watch the same channels, but now I have to pay a significant cable bill. And the channels still have the commercials.

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