Basic Attention Token (BAT) is a utility token built on the Ethereum network that is meant to improve the current broken and opaque digital advertising model. It is seeking to accomplish this by providing a new medium of exchange between advertisers, publishers, and users.
According to the BAT team, digital advertising has been taken over by middlemen and trackers, and users end up taking the brunt of the damage. Up to 50% of the average user’s mobile data is used to load ads and trackers, costing as much as $23 a month in data charges. Ads can take about 5 seconds to load on average, which significantly slows down webpages, and can decrease phone battery life by as much as 21%. User privacy is also violated, as large media sites can host up to 70 trackers.
Traditional publishers are also hurting under the current model. Large corporations like Google and Facebook take 73% of all ad revenue and 99% of all growth. It also doesn’t help that over 600 million phones and PCs across the globe now run ad-blocking software. Advertisers are losing because they don’t receive good information on what they are paying for and targeting can be poor, making users more likely to ignore their ads.
The BAT team believes the solution to the problem is a decentralized digital advertising exchange based on the blockchain. They want BAT to become the future web standard that protects user privacy while solving the problem of monetizing publisher content.
Basic Attention Token Pricing, Market Cap and Volume
The Basic Attention Token was launched in a crowdsale in May 2017 with the goal of raising the equivalent of $24 million USD in ETH. The ICO sale generated significantly more money than their original goal, raising $35 million USD worth of Ethereum. There is finite supply of 1.5 billion BAT and it is distributed as follows:
- 200 million is held in a development team pool
- 300 million is in a user growth pool to incentivize adoption
- 1 billion was made available during the token launch
The ICO price was 1 ETH for 6,400 BAT. In June 2017, right after the ICO ended, the price of BAT was listed at $0.16 with a market capitalization of $170 million USD. Like most crypto assets, its value shot up in the last quarter of 2017 and its market cap reached ~$900 million USD around the same time. Its value plummeted in January 2018 and, like many other digital currencies, it has experienced periods of significant volatility.
How Basic Attention Token Works
Basic Attention Token is a component of Brave—a fast, open source, privacy-centric web browser that blocks third party ads and trackers. The Brave web browser uses a ledger system to anonymously measure user attention. BAT is the medium of exchange for an anonymous and secure opt-in advertising system based within the Brave browser. It takes Brave’s mission to the next phase by connecting advertisers, publishers, and users. This creates a new advertising marketplace that rewards users and protects their privacy, while providing higher yield to publishers and better conversion to advertisers.
Advertisers give publishers BAT based on the measured attention of users their ads receive. Users receive BAT for participating. They can donate the BAT they earn back to publishers or use it on the platform. The system provides the following benefits to users:
Users – security and privacy when viewing ads coupled with improved relevance and performance, and a share of the profits.
Publishers – better reporting, improved revenue, and less fraud.
Advertisers – better attribution, improved customer attention, and less fraud.
The value of BAT is denominated by user attention. In its early stages, BAT will be specifically tied to the Brave browser and verified publishers. Ads served to users will be rate-limited and tied to active windows and tabs. The Brave browser measures attention in real time as users view ad content in an active tab. Ads are anonymously matched with user interests using machine learning algorithms, which means more relevant ads.
Brave will work with advertisers and publishers to establish best practices for calculating attention. Currently, the developers are considering a metric that measures that total views an ad receives in a certain number of seconds. They will come up with more cost-per-action models as the project develops.
Publishers will receive the biggest share of the total ad revenue. Users will also receive rewards which they can use to pay for premium content or services on the Brave platform. The developers expect users will also give some of the tokens they earn back to publishers, further adding to their revenue. Using cryptography, Brave will mitigate ad fraud and provide better client-side integrity. Much of the infrastructure required to launch BAT is complete. Users can download the Brave Browser for Windows, Mac OS, Linux, or Android to try out the system.
Basic Attention Token vs. Other Cryptocurrencies
Basic Attention Token is attempting to fix the current digital advertising model. That goal alone sets it apart from a majority of the cryptocurrencies in existence, because there are not many other coins on the market within the digital advertising space. The system has a number of use cases, which include:
Specific targeted advertising – a lot of small business owners have modest advertising requirements that may be served by tokens they acquire through regular browsing. They can create highly targeted ads for people of a niche subculture, for example.
A subscription alternative – BAT could unlock a new revenue stream for publishers with premium content ordinarily only offered to subscribers. For instance, quality videos or audio can be restricted to users who make a BAT micropayment. Or users may make a micropayment to share premium content with five of their friends.
Comment curation – good comments may be “upvoted” using BAT to give them more credibility. To prevent abuse, token transfers can be verified as coming from real people instead of bots. The right to post comments may also be purchased using BAT to curb spam or abusive comments.
Powering the Brave ecosystem – BAT may be used to purchase digital goods like data services, high resolution photos, or publisher applications that a user needs on a one-time basis. Many publishers have interesting content and tools that users want to use, but a subscription would be too costly. Using the BAT system, publishers could give users access to a small part of their archive or to one of their tools for a limited time.
New app economy – BAT may be used in games and apps built by publishers within the Brave ecosystem.
Buying, Storing and Selling BAT
BAT can be acquired from a wide range of exchanges, both small and large. The most popular exchanges where BAT tokens are traded include Binance, Bittrex, Bitfinex, ChaoEx, EtherDelta, Gate.io, Huobi, Liqui, Livecoin, and Upbit. Bittrex currently has the highest trading volume for BAT. The BAT team has not encouraged or facilitated the trading activity taking place in any of the listed exchanges.
BAT is an ERC20 token that can be securely stored on Ethereum wallets like MyEtherWallet, Mist, Jaxx, Exodus, and MetaMask. BAT can also be stored in popular hardware wallets like Ledger Nano S and Trezor or on an exchange wallet. There is no official BAT wallet yet, and the BAT team has not recommended a particular wallet.
Basic Attention Token Liquidity
The BAT team periodically gives away tokens from the user growth pool to users who install the Brave browser and enable Brave Payments. As a result, BAT has a relatively low liquidity compared to other utility tokens on the market. It is important to remember that Basic Attention Token is a utility token and not an asset. Holding BAT does not represent ownership of anything. It is still too early to tell if BAT will be successful as a utility token for a new system of digital advertising, but its use case is promising.