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Thanks to Dimitri De Jonghe at Ocean Protocol for his intellectual input, Simon de la Rouviere and Mike Goldin from ConsenSys for their inspiring work.
The internet today has become a place where large corporates control and dominate cyberspace.
A place where these centres of power are primarily motivated by turning a profit for shareholders who generally do not represent or possibly care about the real users of the network.
The effect has been the rise of social networks where the norm is:
- Users curate content for free by uploading content and personal information in order to build their social status and reputation.
- The network extracts this value by selling the user’s data to third parties such as advertisers.
I believe there is a better way:
Networks that are owned and regulated by its user base, who share and benefit financially from its success.
The Challenge
The difficulty is the Network Effect that makes it difficult to challenge the established status quo.
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The Network Effect: The more people who participate in a network, the more useful that network is.
When a social network passes a certain threshold, power becomes consolidated. Users have established a social and repetitional status and find it difficult to switch to alternatives, which may have fewer participants and where they will have to rebuild their social status.
The Solution
Monetary Value Inclusion — participants share in the network’s success by being financially rewarded and where early adopters receive the greater reward for being first movers.
I believe there should be no distinction between the users and the owners of the network. More specifically, participants whose activities are part of the common shared goal of curating great content for the community should share in the financial benefits they generate.
Introducing Lightstreams
Lightstreams is a protocol for building decentralised communities around digital content.
Our mission is to create a network for building distributed, peer-to-peer communities around digital content. An open ecosystem that enables innovative decentralised applications where creators and fans can connect in a low cost, fair and open marketplaces.
The Lightstreams design focuses on the requirement of privacy, confidentiality and scalability when sharing content between participants in a distributed network. The Lightstreams protocol achieves this by enabling authorised participants to add files to blockchain smart contracts with associated programmable permissions that control access.
Fanbase Content Curation
By combining Lightstreams protocol for controlling access to restricted content and the concepts of Token Curated Markets, Token Curated Registries and Token Curated Governance with Stake Machines we can get very interesting network behaviours.
Introducing Fanbase Content Curation, an idea I have been kicking around in my head…
The goal of Fanbase Curated Content is to create the conditions where fans are financially rewarded for the content they curate while simultaneously building their social status and reputation.
In Fanbase Content Curation, fans form communities around particular music genres or artists that they are passionate about. These groups are moderated by the community, similar to how subreddits are community moderated.
For each group, a new cryptocurrency token is established to be used for voting on proposals and for ranking content. The token will have value based on the Lightstreams native token called a Photon (PHT). This new token can be sold on secondary markets.
Mini-ICO’s for Artists
Artists can become beneficiaries of communities created by fans by newly minted tokens being allocated to artists. This will effectively create an entirely new funding channel for artists.
An Example: The TSWIFT Token
Imagine Taylor Swift is an unknown artist. She had just been discovered by a Tom who has seen her performing at a local bar and thinks this she is amazing. Tom convinces Taylor to create a smart contract, to build community around her music through a TSWIFT token.. The TSWIFT token will be used for:
- Unlocking benefits and merchandise including discount tickets to concerts and new music tracks.
- Voting on proposals, such as where Taylor Swift should play her next gig.
- Funding Taylor Swift’s career via minting TSWIFT tokens.
- Building financial wealth for Tom and others who invest early by buying TSWIFT tokens.
The Value of a TSWIFT token
So how does the TSWIFT token have financial value?
The token’s value represents the attention of fans around Taylor Swift. The market price of a TSWIFT token is a function of a smart contract algorithm. That is, the smart contract defines the price for minting a new TSWIFT token such that as the total supply increases the price of minting a token increases. The algorithm cannot be modified once the smart contract is published.
To give you a simple example, Tom publishes a Taylor Swift smart contact and mints the first TSWIFT token by depositing 0.10 PHT into the smart contract, which holds Tom’s funds in escrow. The price of 0.10 PHT was defined by the smart contract algorithm. If Tom wants to buy another TSWIFT token the algorithm says he will need to deposit 0.20 PHT and then there will be then two TSWIFT tokens in circulation.
At any time Tom can cash out his TSWIFT tokens and receive some of his PHT tokens back. When this happens, these TSWIFT tokens will be removed from circulation. The price of minting a TSWIFT reduces since the supply of tokens in circulation has reduced.
Source: Token-Curated Registries 1.0
Note: There is a margin price between minting (buying) a new token and cashing out (selling) a token. Tom will need other fans to come along and mint tokens for him to break even and to make a profit.
Tom also has the option to sell his TSWIFT tokens to somebody else on a secondary market as an alternative to cashing out directly with the smart contract.
Taylor Swift is a beneficiary of the smart contact such that as new tokens are minted by fans, the smart contract could mint her a ratio of tokens. For example, for every new TSWIFT token minted by a fan, Taylor Swift will also receive say 0.30 of a TSWIFT token. Taylor Swift can then fund her music career by withdrawing some PHT funds from escrow or by selling her tokens on secondary markets.
Another Example: Ranking of Top 50 Hits
We can also apply Fanbase Token Curation to genres of music. For example, a Top Summer Hits token called a SUMHITS could be minted for creating a community around this genre. Those fans that own SUMHITS tokens can suggest tracks and vote on their favourite top hits.
How this works is anybody can make a proposal by staking an amount of SUMHITS tokens. A proposal can be:
- A proposal to add a track to the Top Summer Hits chart.
- A proposal to move a track higher up the chart.
There is a period when someone can challenge this proposal. To challenge the proposal the challenger must stake the same amount as the proposer. Once a proposal is challenged, it is then voted by the community. If the proposal is not challenged after the period then it immediately comes into effect.
- If the community votes for the challenger, then the challenger takes the proposer’s stake.
- If the community votes for the proposer, then the proposer’s takes the challenger’s stake.
To vote the community must also stake token. Those voters that win the vote take a proportional share of the tokens staked by the losing voters.
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