Introduction of the Datareum Decentralized Data Marketplace
“Information is the oil of the 21st century, and analysis is the internal combustion engine.”
-Peter Sondergaard. Gartner Research
If information is the oil of the 21st century, everyone is on an oil well.
We all generate absurd amounts of data in the course of our daily lives. Every (electronic) purchase we do, every Google search we make, every website we view, where our pointer is on each of the websites, any social media post we see, comment, share, like, skip , pause and watch for more than half a second – all this is recorded in exponentially growing global databases.
The production speed of data increases so that, according to an IBM Marketing Cloud survey, 90% of the data currently on the internet has been made since 2016.And as more and more devices, such as the sensors in your Fibit, smart refrigerator, and your countertop Alexis – are connected to the internet, data production is only going to speed up.
All these data have value. It is currently used primarily for marketing and academic research, but is increasingly being used to make useful suggestions and predictions about ourselves and to feed the artificial intelligence that will ultimately be the most valuable thing ever made.
But that is all in a rather distant future. For the time being, the real value of data is usually out of our reach – after all, none of us has been able to cede the profit that is generated with it. IDC research shows that 90% of the data produced so far is still unstructured, meaning that it is difficult to extract any tangible meaning.
Which structured data we have is usually not in our personal control. “Data Custodians” like Facebook, Google and Amazon use it for huge profits. Then there are “Data Brokers” who scoop everything they can and sell it to the highest bidder.
The result: almost all these valuable data are beyond our control and are used by others.
But there is change on the horizon and it comes in the form of a movement towards decentralization. The emergence of the sharing economy has led to an emerging new ethos regarding the nature of property. This is a move away from centralized companies and governments as managers of information or money, towards decentralized peer-to-peer interactions.
This decentralization movement has recently received a huge boost thanks to progress in cryptography and the even more recent emergence of cryptocurrencies.
Now it is possible for the first time to exchange value on a peer-to-peer basis without the need for a trusted authority. As we know, the first application of this is money in the form of Bitcoin and other peer-to-peer cryptocurrencies.Decentralized money is truly revolutionary and it will have a huge impact over the coming years and decades, but money is only the first application. With this technology we can exchange any kind of value. All that is needed is the infrastructure and the network to make it possible.
The infrastructure to enable the trading of data is what we want to build on Datareum. Our long-term vision is a world in which data providers have complete control over the data they produce and data seekers have access to ethically produced, high-quality, structured data at a fair price. In this world, providers will be reasonably compensated for the value of their data and researchers of all kinds will have access to the high quality data they need. To make this vision possible, we are building a decentralized peer-to-peer marketplace for data: the Datareum Marketplace.
Although our long-term vision is great, we recognize that it is essential to start small.
Just like at the beginning of the internet, many wonderful ideas were just too early for their time, in the newly emerging world of blockchain / decentralization that people call Web 2.0, many – perhaps most ambitious – projects are doomed to fail.
Determined not to fall into the failure category, we are strongly dependent on thelessons from R3’s multi-year collaborative research on blockchain research (the world’s largest research program of its kind to date) into the likelihood of success of a particular blockchain business project. We design our platform – both in its original form and in the long term for the rollout of additional functions – to comply with the recommendations in the report. The most important recommendations are:
Offer an integrated application, messaging, workflow and data management architecture.Build on an existing “mega-ecosystem” of technology to maximize skills and code re-use.Remove unnecessary ‘silos’ with data to unlock new business opportunities by allowing real-world assets to move freely between all legitimate potential owners.Enable legal entity identification in the programming model to enable legally enforceable and secure transactions.Enable the inevitable transition to the public cloud without the use of risky technology
Taking into account these recommendations, we have established that online surveys are an appropriate starting point for our decentralized data marketplace.The old online survey industry is a good target for disruption with the decentralized model because:
It lacks guaranteed security and privacy of information. – Collected information is stored on centralized servers and as such is vulnerable to hacking. – By joining a membership site, chances are that users have allowed it or are “marketing partners” to ask them.There may be multiple layers of intermediaries. – Online paid surveys are usually conducted by market research agencies acting as intermediaries between the customer company and the data provider. These market research firms can, in turn, employ smaller companies to conduct surveys for them, adding a new intermediate layer. Even if the payoff by the original client companies is generous, the many layers of commissions reduce the profit margin for all those involved.There is a high degree of payment friction. – Because of the high transaction costs within the existing banking infrastructure, minimum payments are often set at unreliable levels. – Payments are in most cases only available to residents of a particular country. – Payouts are often offered in the form of vouchers instead of cash.
A decentralized online survey market built on blockchain architecture has the potential to solve the above problems by providing secure peer-to-peer access between data applicants and data providers. The marketplace must contain all the necessary incentive mechanisms to ensure its proliferation. We have outlined this in our whitepaper and will soon post a summary in this blog space.
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