News by Forbes: Ilker Koksal
All eyes are on data. From the regular data breaches that pepper the news to the growing consternation of politicians, data, privacy, and tech are at the center of modern consciousness.
Unsurprisingly, one of the major focuses for many in the blockchain and cryptocurrency space is to look at data and privacy in new ways, allowing consumers and true peer to peer networks to take control of their data back from big companies.
The data these increasingly monopolistic giants collect about users and their behaviors is the most valuable part of any digital application. Indeed, it is valuable enough that it has allowed the mobile and desktop internet to provide those users with countless experiences for no monetary payment, just the surrendering of that data to the platforms who then allow it to be used to help with targeted advertising. The problem has been that the data goes into a black box and there is no transparency or accountability on how it is used.
This is where Storecoin’s mission comes. The idea at the center of their just-released Lite paper is the tokenization of data. To the team, data tokenization creates numerous benefits.
Expressing his thoughts on the idea behind Storecoin, its CEO and co-founder Chris McCoy said, “If we’re right about our thesis, a new computing platform emerges — one powered by open and tokenized data. Not only do developers get paid when the Google’s of the world want to query/crawl/search their data, but developers can also build with the open data streams and open APIs of other developers (who get paid when the developers access their data stream; 1MB data = 1 datacoin). Best of all, they can provide more transparency and even share data revenue with users. I think this can change the world.”
Tokenization of data addresses the lack of transparency by making it much easier for users to have clarity on how their data is being accessed, by whom and for what. Their data privacy is guaranteed by strong encryption when the data is stored and a context-sensitive anonymization when the data is searched, paid for and accessed. What’s more, some application developers could even take advantage of data tokenization to cut their users in on the financial upside of that data and create incentives for them to share even more.
For users, then, tokenized data seems to create some strong advantages — transparency, privacy, and security—, but what about for developers?
In their ecosystem, miners (or dWorkers as Storecoin calls them) host the applications, whose data is tokenized and opened on the Storecoin Platform. The tokens, which are backed by data are called, datacoins and often the miners are being paid in those datacoins for providing developers with the cloud computing infrastructure. This allows those miners to have a part in the upside of the data while also being paid for the services as they’re rendered. For application developers then, this offers a more profitable alternative for hosting their application than paying for a centralized service like AWS.
But why, when so many ICO tokens failed, would these new datacoins as the company calls them actually accrue value? In a conversation with me, this is what Storecoin creator Chris McCoy had to say:
“The first generation of ICO tokens tended to just be payment coins. They didn’t offer any new value other than to be able to pay for something in the network. Because of that, the only way they increased in value was speculation and hope. Datacoins represent something different. They are explicitly connected to the most valuable part of any digital ecosystem, which is it’s data. In this way, datacoins have intrinsic value, as opposed to most “utility tokens” which are just based on faith.”
These concepts and more are articulated in the Storecoin’s just released Lite Paper — a precursor to its technical whitepaper.