The New Data Economy – Genesis Block for a data-backed Universal Basic Income?
–– 11 Dec 2020
“Meet the New Boss, Same as the Old Boss”
It’s been 50 years since The Who coined this phrase in the context of social upheaval with the close of the 1960’s and supposed end of the Old World Order.
Two years after GDPR opened a Pandora’s box of issues around data monetization the abuse, middle-men, and monopolistic position of platforms seems worse than ever, with regulators out-maneuvered by Big Tech. But appearances can be misleading.
If we accept the Web has seen 2 cycles since its creation by Tim Berners Lee – the first connecting machines, the second productizing users – then the third, that of decentralization and individual agency, is already here or at least knocking on the door…
While the concepts of “Exits to Community” and “Fair launches” have gained ground in the start-up and crypto worlds, a fair deal for data owners and re-definition of brokers is emerging as central pillar of the New Data Economy and the stimulus for a wave of technological innovation.
According to the World Economic Forum, data powers around 15% of the world’s GDP, with most of it created in the last 2 years.
The explosion of data around wearables and platform dominance has led regulators to use their ‘nuclear option’; to stop companies processing data, and lawmakers to force portability in the form of CPRA (US) and the European Data Governance Act.
This is nothing less than an Extinction Level Event for the international trade in third party data.
So, bad news for the status quo, but who is all this being done for?
There are 3 groups who can benefit from this change:
- People: Can sell their data directly to licensees, in a marketplace or stake it in liquidity pools where they set the parameters of what is an acceptable use.
- Data Unions: Can find a data rightsholder and build a relationship of transparency, then act on their behalf to sell their data.
- Data Scientists: Can add value to open datasets by refining and enhancing info for analytics tools to consume, create synthetic data using permissioned personal info, then sell all of this.
By exploring the options offered for staking and data farming now and in the future on data marketplaces like Ocean and Streamr, individuals and groups can create an ongoing annuity in terms of transaction fees and rewards.
As these projects are decentralised and open-source, groups can even go one step further and run their own market, using open-source codebases and libraries. This way, they get a percentage of total marketplace transaction fees, as ‘the house’.
This has the potential to tip the current power structure on its head, and create a new economic model for a data-backed Universal Basic Income using decentralized technologies informed by, but much larger than that seen in the DeFi space.
Not everyone has crypto to stake and play with, but we all have our data…
With billions of individuals connected to their data and trillions of revenues in motion, the opportunity is huge, but the way most people will engage is through a trusted intermediary who shares their belief system and plays by agreed rules, along the lines of ‘Data Dividend’ groups in the US, and Data Unions in Europe.
If brought into statute in a coordinated and integrated way, an ecosystem is created where thousands of Data Unions can exist and flourish using agreed protocols and the principles enshrined in GDPR.
Regulators can play a key role in accrediting both new and existing groups on a community, organisation or trust basis to act on behalf of their members and replace the role currently occupied by platforms and ‘trust nodes’ such as credit reference agencies.
The current situation of companies ‘marking their own homework’ is replaced by control and agency in the hands of citizens and their licensees, with the public blockchain as the central statement of record for data transactions.
What are the tools and standards to make this portability and the New Data Economy a reality?
Making consumer-grade technology for data dialogue and Web3 wallets available is a key component. Tapmydata and others have pioneered this from a technological and social point of view; with personal data and ID credentials verified and secured, to license or sell data users simply connect their Web3 wallet to the intermediary or market without any login.
With Compute-To-Data as used by Ocean, the market brings buyers to you and data stays on premise, keeping control and privacy with the owner, plus discretion to exercise rights, withdraw consent and keep an audit of usage.
The legal, technical and social frameworks are coming into place for a new, enlarged engine of sustainable data commerce which is censorship-resistant and enables all players to transact on the same terms, as their own boss.
The EU and others have set aggressive timescales for adoption of true consumer data markets by 2022 which is likely to be picked up in the mid-term US election cycle, so the time for Tapmydata, Ocean, Streamr among others to become the Trust Nodes of the New Data Economy has come…