BitClave, the decentralised blockchain search platform, underwent what is known as a "token raise" on 25 July. This is the blockchain equivalent of a funding round and means it sold off its cryptocurrency, the Consumer Activity Token (CAT), to raise capital and interest in its proposition.
This begs the questions: why should we be interested and what does it have to do with online advertising? The simple answer is: not much and not really.
Ostensibly, the business is out to do what many have tried and failed to do previously: connect advertisers and services directly with consumers by offering the latter some form of reward. But the road to incentivised marketing is paved with the corpses of these failed services. From Wi-Fi to coupon to loyalty, they all have tried and failed to alter the path of the consumer with the belief their product would prove meaningful enough for people to drop their typical behaviours in droves in favour of a "quid pro quo" ideology.
And why is this so attractive to these would-be entrepreneurs? Currently Google, Facebook, Twitter et al sell your data on your behalf – in return for which you can Tweet, search and share to your heart's content. And we, the consumers, have turned them into shiny great unicorns, with advertisers shovelling billions of ad dollars into their mouths monthly.
BitClave argues that it puts that money back into the hands of the consumer – using none other than our golden goose of the month: blockchain. Specifically, a utility called a "smart contract" that will enable them to confirm with 100% accuracy that a person made a search, and duly reward them.
Sounds great, right? The problem is, they may have no intention of launching. If you know anything about blockchain, you’ll know it is very, very easy to make money by getting crypto-people to buy your coin, which they then trade against other cryptocurrencies online – in this case CAT. This is how BitClave probably intends to make money. Like many other crypto-companies, in my opinion, BitClave proposes an impossible-to-realise, game-changing solution to spin up its token sale, largely indifferent to whether it will succeed in its proposed business.
What’s more, the incentives to launch the product are small when you look at other, recent, similar token rasies. For example, Brave, a blockchain-based browser, underwent a similar token sale and generated around $35m in 30 seconds. A few months later… no users. Similarly, AdToken has raised around $28m on its ADT, with the end of achieving exactly what the IAB has solved with its simple and elegant ads.txt solution.
Ultimately, most cryptocurrencies trade off each other with no real-world value or palpable benefits. That will not always be so and there are many extremely worthwhile blockchain solutions out there trying to build momentum. The reality is that currently illegal drugs and weapons are the only tangible products being traded at scale using cryptocurrencies.
So back to BitClave’s goals, and what we’ve seen from Rainbow’s research is that consumers don’t hate ads full stop; it’s only ads that are either annoying, intrusive or simply not relevant to them. As an industry, we are bad enough when it comes to newfangled tech jargon, and the last thing we need is to add to it by borrowing from fintech.
Services such as BitClave are just another hyped-up fad that distract from the real issues. We need content and we want services, so let’s reduce the noise and aim for excellence by ensuring that advertisers and publishers are always keeping the end consumer in mind, and create ads that are relevant, engaging and non-intrusive.
James Collier is chief revenue officer of Rainbow