Money is the lifeblood of our civilisation, a pulsing heartbeat that keeps society ticking, and the evolution of it is a fascinating concept.
Whether it’s nation states giving its residents the ability to pay bills; purchase train tickets; and even buy street food using QR codes, or for those of us slightly behind the unavoidable technological stampede, the ability to tap your phone and complete a simple transaction in a supermarket — it’s hard to fathom the evolution leading up to these events.
The medium of exchange can be traced back 40,000 years, when groups of hunters in the Upper Paleolithic era traded the best and most desirable flint-based weapons for various tools between one another. This created a natural bartering system, which went on to include items such as cattle, grain and fish. As these were non-fungible and easily perishable, eventually scarce natural objects arrived as the unit of value for exchange. These are objects that were rare to find in nature and whose circulation could be controlled for exchange purposes. Shells being the first form of this, but it ranged from copper, amber, obsidian and even meteorites.
Once gold and silver was introduced, and the ability to verify with touchstone (a test for determining the purity of gold and silver) was initiated, an even newer form of exchange was born. This led us to what we know today as currency. The earliest and most well documented form being the Mesopotamian Shekel, which was used to provide stamped gold and silver coins to pay the armies of Western Asia. One coin represented a specific weight of barley, value was attached, and thus fungibility was born. A far cry from the technological innovation that is the QR code.
What exactly is money though?
It’s a strange concept, when you strip it down to its core. Today, I can give you a piece of paper that supposedly holds a certain value, and in return you give me goods that we both deem to be a fair trade. The only reason we believe it has value is because the powers that be tell us so. Rather unsettling when you realise these are the same corruptible entities that control the supply.
Thousands of years ago, and even in its primitive form, it still boiled down to the basic principle of supply and demand. If there was a certain shell that was rarer in a particular area, then those shells would be worth more. If there was an abundance of that particular shell in the area, the value would be worth less. Simple really.
As time passed by and governments grew into power, the inevitable trait of human greed reared its ugly head. In 1920’s Germany during the Weimar Republic, the German government printed money to pay for WW1, and from 1913 until the end of the war, the number of Deutschmarks in circulation increased from 13 billion to 60 billion. Along with this, government bonds were printed and Germany’s sovereign debt soared from 5 billion to an incredible 100 billion Deutschmarks.
This is not the first instance of hyper-inflation and will certainly not be the last. As long as mankind has the ability to print as much of the supply as they deem fit, history will always repeat itself. This has resulted in situations such as Venezuela, where it takes a literal pile of cash to buy a loaf of bread. Or Zimbabwe, where a 100 trillion dollar note can be found bustling in the wind amongst the dismay of honest and hard working people. How about the 2008 financial crisis? Again, led by the unavoidable human trait of greed. The list goes on and on, and history has time and time again shown that people in power cannot be trusted when it comes to money.
In times of despair come glimmers of hope.
The year is 2008, and a mysterious individual named Satoshi Nakamoto posts an unassuming white paper online for the world to bear witness to. A new peer-to-peer digital cash titled ‘Bitcoin’
While various digital cash systems had been attempted in the past, none were able to solve the long-standing ‘Double Spend’ issue that had been perplexing computer scientists for decades. Satoshi solved this with elegance and subsequently created an incredibly clever system where, through code, the ability to unnaturally inflate the supply is thwarted. Digital money is, for the first time in history, scarce, and the people of the world can finally claim back their financial sovereignty. It was about time. The first transaction of the genesis block also had a sobering reminder of the failings of our monetary system hashed into it, forever public as long as the network was alive.
“Chancellor on brink of second bailout for banks”
As Bitcoin gathered steam and the concept of ‘Digital Cash’ was burned into our collective psyche, people were forced to take notice. Several attacks on the network, a barrage of media propaganda and the threat of heavy government regulation couldn’t stop the force that was Bitcoin. It just wouldn’t die. The longer it stayed alive, the stronger the belief was. Also known as the ‘Lindy Effect’. A notion that future life expectancy is directly proportional to current age.
While Bitcoin was a natural evolution of our monetary system, and the first obvious use case was currency, this is not where blockchain, the underlying technology, stopped. The next evolution of this system was in smart contracts and digital assets. The origins of the smart contract can be traced back to 1996, to American cryptographer and programmer ‘Nick Szabo’ with his definition being:
“Smart contracts are digital protocols for information transfer that use mathematical algorithms to automatically execute a transaction once the established conditions are met and that fully control the process.”
While the concept was theoretically sound, in 1996 there was no such technology to implement such a system. It took years of failings in our monetary system, a turn of unfortunate economical events, and the immaculate inception of Bitcoin to eventually serve as the impetus for the smart contract to be created.
A new realm of possibility opened up for digital assets.
The ability to provide proof of ownership and a transfer of value is a marvellous feat. The ability to remove the middlemen out of these transfers is a marvellous feat. The ability to create scarce, digital assets is a marvellous feat that knows no bounds. Programmable code-based ownership is no doubt the future.
Fast forward to 2019 and there is one project incorporating all of these ideals, aiming to be at the forefront of the digital asset movement: Elastos DMA (Decentralised Digital Marketing)
The ethos behind Elastos DMA
DMA encapsulates the notion of owning your own data and creating a form of sovereignty that is unparalleled in modern e-commerce. A lot of our freedoms have been slowly stripped away, with the steady stream of personal data siphoned from us for over two decades.
DMA gives people the freedoms necessary to transform their own personal data into wealth, and they believe that the best way to achieve this is by building commercially viable, transparent applications that enable the end-user to profit directly.
Here are four use cases that DMA believe will enable users to experience the next evolution of personal freedom within the digital commerce and data economy:
‘Uptick’, the first pilot dApp powered by DMA is a digital marketplace for buying and selling tickets. Eventually aiming to be the enabling layer for local businesses to create their own ticket dApps across all regions.
It’s really no secret that this industry is a mess. The fees that companies such as StubHub and Ticketmaster charge are notoriously expensive. Removing these middlemen and replacing them with code enables the end-user to not only benefit from cheaper tickets, but also take part in a process that is completely fair and transparent. From both the consumer and issuer perspective you now have complete control over every ticket you have bought and sold. Blockchain gives you the ability to control the records of these tickets, which in turn dramatically reduces costs. For everyone.
If you want to buy concert tickets on the secondary market, this is also a giant mess. Forged tickets are a real problem and have left many concert goers disappointed as they are refused entry to a concert they paid a gargantuan amount of money for. DMA provides the ownership we were talking about and assigns a Decentralised Identification (DID) to each ticket. In layman’s terms this means that your identity is linked to the ticket and you are now free to do with it as you wish, it is your property after all.
Uptick gives you the ability to confirm that your ticket is genuine, and also avoid a mark-up of up to 50%, with profit from some scalpers exceeding 1000% for the bigger concerts. With smart-contract technology, this is no longer a problem as the price is immutable and programmed into the code (i.e. the ticket) and cannot be tampered with. E-tickets are the perfect use-case to begin displaying the power of DMA.
Copyrighted Digital Content Management
For content creators, this is an exciting prospect. When you license a song for something like an advert, you must first sign up with a licensing company. They then take on the task of finding a suitable buyer for your music (along with 50% of the profits). This is a painstakingly slow process, with very little transparency. However, DMA allows one to cut out those middle-men and license not only music, but games, art, books, etc. All without that third party taking the cut.
When you buy an e-book from Amazon, you don’t really own it. You’re leasing it. DMA want to make it so that if you sell an e-book (or any digital asset for that matter) the ownership is rightfully transferred over to the next user and everyone is paid the fair and mutually agreed amount. DMA targets creating scarcity, giving artists the ability to sell a limited amount of their product. A world where people actually own the art they produce and get paid fairly for it.
Data Driven Advertising
There is a severe and crippling lack of transparency in the digital advertising space. Here’s how the process usually works: The advertiser (i.e. the brand) that wants to engage with an audience will hire a digital advertising agency to manage the entire marketing campaign. The cost comes from creating the campaign itself, and then the distribution of the content to the target audience. The ad agency then buys advertising space in order for the target audience to actually see the content. The other method is through a data exchange platform.
What comes next is an avalanche of hidden fees, fraud, and extremely opaque traffic measurement statistics. In every step of the supply chain there are hidden fees and charges. Not only this, but there are a slew of fake impressions from publishers, domain spoofing, and an overall lack of integrity. If advertising is the forest fire of data transparency, then blockchain is the code-based extinguisher we’ve all been waiting for.
How does DMA solve these issues?
Ad views will only be accounted for if verified by the blockchain and the (DID) that is linked to it. That means that the publishers will be forced to provide accurate information. DMA will also be able to invalidate views from the streamers watching from more than one source.
From the end viewer perspective, DMA can bring big changes to the operation and profit sharing model of the ad space in every application. The freemium model is very popular — you use the app for free and the app platform makes money from the adverts by using collected personal data. We are all helping the app companies make money and soon we will begin to resent this. The app platform is collecting our data and runs targeted ads, but we don’t receive a share. This creates a situation where users hate the ad banners, but can’t get rid of them unless they pay the ad removal fees.
Why not think about this more from the users perspective?
There is still the ad banner/window in my app, but the ownership of this banner space is my own. I grant permission to the operator of this banner space to use my data and post targeted ads, but I subsequently receive a big cut of profit, while still a decent portion goes to the banner space operator.
Everyone is happy. The advertiser, publisher (banner space operator) and the user (banner space owner).
This is the notion of DMA where ‘you own your data as property and you run your own property to create wealth’. DMA seeks to move e-commerce forward in a completely transparent manner.
With social networking beginning its path to world domination in the late nineties, it’s pretty amazing to think about how it’s spread across the entire globe. People cannot leave home without their smart-devices.
Social media marketing is the process of leveraging engagement on social media websites, with the aim to drive growth, increase traffic and ultimately turn your online business into a success. There is one problem with this: The monopolisation of the social media giants. Their sole aim is to monetise your user-generated content. This is done poorly with a true lack of incentive for the content creator.
DMA wants to bridge the gap between the brand and the consumer. Brands should be able to easily connect to the end-user and create a level playing field for everyone.
The benefits of blockchain are tangible, ever-growing and will thrust the digital frontier further forwards. The paradigms of e-commerce have atrophied amid the dominance of the major players, so solutions are needed that create a fairer and more transparent world for everybody. Just like the transition from bartering to the shekel, the next logical evolution of blockchain technology is Elastos DMA.
DMA 1.0 is scheduled for release in just a couple of days, and while this is just phase one of the plan, the next steps are already in place and will be revealed to the world in the coming months.
Welcome to the future of money and commerce.
Article by Chris Parker