Comment by asim
11 days ago
This is basically just how we want to do micro payments. I think coinbase recently introduced a library for the same using cryptocurrency and the 402 status code. In fact yea it's called x402. https://github.com/coinbase/x402
This should be the standard business model on the web, instead of the advertising middlemen that have corrupted all our media, and the adtech that exploits our data in perpetuity. All of which is also serving to spread propaganda, corrupt democratic processes, and cause the sociopolitical unrest we've seen in the last decade+. I hope that decades from now we can accept how insidious all of this is, and prosecute and regulate these companies just like we did with Big Tobacco.
Brave's BAT is also a good attempt at fixing this, but x402 seems like a more generic solution. It's a shame that neither has any chance of gaining traction, partly because of the cryptocurrency stigma, and partly because of adtech's tight grip on the current web.
Microtransactions are the perfect solution, if you have an economic theory that assumes near-zero transaction costs. Technology can achieve low technical costs, but the problem is the human cost of a transaction. The mental overhead of deciding whether I want to make a purchase to consume every piece of content, and whether I got ripped off, adds up, and makes microtransactions exhausting.
When someone on the internet tries to sell you something for a dollar, how often do you really take them up on it? How many microtransactions have you actually made? To problem with microtransactions is they discourage people from consuming your content. Which is silly, because the marginal cost of serving one reader or viewer is nearly zero.
The solution is bundling. I make a decision to pay once, then don’t pay any marginal costs on each bit of content. Revenue goes to creators proportionally based on what fraction of each user’s consumption went to them.
People feel hesitation toward paying for the bundle, but they only have to get over the hump once, not repeatedly for every single view.
Advertising-supported content is one kind of bundle, but in my opinion, it’s just as exhausting. The best version of bundling I’ve experienced are services like Spotify and YouTube Premium, where I pay a reasonable fixed monthly fee and in return get to consume many hours of entertainment. The main problems with those services are the middlemen who take half the money.
I disagree, bundling is the problem. That strategy created the fragmented landscape that we now see in streaming video, which is pretty much universally hated.
The ideal solution would involve a flat rate which I pay monthly, and at the end of the month that money goes towards the content that I consumed during that month. If I only read a single blog, they get all of it.
Then we build a culture around preferring to share content which is configured to cite its sources, and we discourage sharing anything which has an obvious source with which it doesn't share its inbound microtransactions.
We already need to do our due dilligence re: determining if an information source is trustworthy (and if its sources are trustworthy, and so on). Might as well make money flow along the same structures.
12 replies →
> the problem is the human cost of a transaction. The mental overhead of deciding whether I want to make a purchase to consume every piece of content […] > When someone on the internet tries to sell you something for a dollar, how often do you really take them up on it?
It depends on how micro they are. Your example of $1 is quite big. It should be cents or even less.
Several examples. When using chatgpt api, do you really worry how much a short q&a session will cost you? Do you stress whether to turn on the light in your room or not (electricity cost is also micro-transaction if you think about it)?
2 replies →
While I agree with most of your comment, there is a pitfall - bundling is often used as an extractive pricing strategy, where you force the consumers to buy goods they do not want to access the one they want.
This is problematic when the seller is a monopoly, and has a strong market power that prevents the consumer to seek alternatives.
https://www.concurrences.com/en/dictionary/bundling
I would pay for YouTube premium in a heartbeat if they didn’t also include YouTube music, which I have zero interest in paying for.
4 replies →
crypto seems like a massive waste for what can just be a regular transaction
Much cheaper than using a credit card processor.
4 replies →
Something like BAT isn't that wasteful, and without crypto you'd be stuck never getting paid by bad actors in the scheme.
10 replies →
Even if advertising were to disappear over night, why do you think that would stop the spread of propaganda, corruption of democratic processes, and social unrest? I don't really see a connection between the two?
It's more like the tech that allows middlemen to insert into everything and be very hyper personalized/targeted
The finiancial connexion is explained here:
https://en.wikipedia.org/wiki/Citizens_United_v._FEC
Really? They're quite connected.
If the architecture of the web changes to one where people only see content that they've asked to see, and that kills advertising, it would also put a significant damper on anyone else whose business involves injecting unwanted content into a viewer's consciousness. Propagandists are the first to come to mind.
If it can become prohibitively expensive to sway an election by tampering with people's information, then the alternative (policies that actually benefit the people) will become more popular, leading to reduced unrest.
Democracy is having a bad time lately because its enemies have new weapons for use against it. If we break those weapons, it starts working again.
Where did I say that all of those things would stop?
What I said is that adtech systems are also used for it. So if they were to disappear overnight, a _proportion_ of those activities, and a pretty large one I reckon, would also disappear.
6 replies →
> This should be the standard business model on the web, instead of the advertising middlemen that have corrupted all our media, and the adtech that exploits our data in perpetuity.
People with content will still want to maximize their money. You'll get all the same bullshit dark patterns on sites supported by microtransactions as you will ad supported. Stories will be split up into multiple individual pages, each requiring a microtransaction. Even getting past a landing page will require multiple click throughs each with another transaction. There will also be nothing preventing sites from bait and switch schemes where the link exposed to crawlers doesn't contain the expected content.
Without extensive support for micro-refunds and micro-customer service and micro-consumer protections, microtransactions on the web will most likely lead to more abusive bullshit. Automated integrations with browsers will be exploited.
Maybe. But at least transactions could be performed directly between consumers and publishers, and there wouldn't be incentives for companies to violate privacy laws and exploit user data.
Of course, we would need to figure out solutions to a bunch of problems adtech companies have had decades to do, but micropayments would be the first step in the right direction. A larger hurdle would be educating users into paying for content, and what "free" has meant thus far, so that they could make an informed decision. And even then I expect that many people would prefer paying with their attention and data instead. But giving the option for currency payment with _zero_ ads is something that can be forced by regulation, which I hope happens one day.
Because this must be done on the gov level.
As I've written about this before: https://news.ycombinator.com/item?id=40972106
Sorry but the sociopolitical unrest of the last decade has been caused by the problems we have created not by people talking about it.
Money need not be involved, just look at how corrupt and biased Wikipedia has become.
Except I don't want to use crypto, I don't want to accept crypto for content, I don't want to pay middlemen for using crypto.
Micro payments using crypto is just a way for folks to prop up crypto currencies. It also is a dead concept, because how do we all agree on _which_ crypto to use? If I'm browsing the internet, and each site only accepts a particular shit coin, is that ok? Does everyone just use a single stablecoin? Now everything is locked to a single currency?
The cloudflare approach is honestly ideal, because it charges people profiting from your content, not humans looking to read your content. It also doesn't use crypto.
I don't think it would even be remotely as technically feasible or viable if it was crypto based. I don't want crypto either, but as far as I can tell, crypto is much much much less ergonomic and inconvenient than just having a tab that you pay off monthly in a normal way with a single transaction.
This is a mistake by Cloudflare. They restrict data access for big players and it would hurt net neutrality as well. I am surprised this gets any positive feedback.
Maybe I'm wrong, I hope I am, but it feels like the boats out for micro payments. To me at least, it feels like for this system to work you want to have something like what PAYG phones have with top-ups. You "put a tenner on your internet", and sites use that in the form of micro payments. Had that been the case since the start, it could've worked great, but now the amount of infrastructure and buy-in required to make that work, it just feels like we missed the chance.
This is really interesting. Assuming I understood it correctly, I wonder why the protocol does not allow immediate return when it gave an address and payment amount. Subsequent attempts should be blocked until some kind of checksum of amount and wallet address is returned. This checksum should be verified by a third-party. This would save each server from implementing the verification logic.
Two missing pieces that would really help build a proper digital economy are:
1. If the content could be consumed by only the requesting party, and not copied and stored for future,
2. if there is some kind of rating on the content, ideally issued by a human.
Maybe some kind of DRM or Homomorphic Encryption could solve the first problem and the second could be solved by human raters forming DAO based rating agencies for different domains. Their expertise could be gauged by blockchain-based evidences and they will have to stake some kind of expensive cryptocurrency to join such a DAO akin to license. Content and Raters could be discovered via like BitTorrent Indexes, thus eliminating advertisers.
I say these as missing pieces because it will allow humans to remain an important part of digital economy by supplying their expertise, while eliminating the middle man. Humans should not be simply cogs in digital economy whose value are extracted and then discarded but should be the reason for its value.
By solving double-spending problem on content we ensure that humans are paid each time. This will encourage them to keep on building new expertise in offline ways - thus advancing civilization.
For example when we want a good book to read or movie to watch, we look at Amazon ratings or Goodreads review. The people who provide these ratings have little skin in the game. If they have to obtain license and are paid, then when they rate an authorship - just like bonds are rated by Rating agencies - the work can be more valuable. Everyone will have reputation to preserve.
It's not a new idea. For example I created https://github.com/philippgille/ln-paywall (also using 402 status code) in 2018.
How do you handle KYC?
As someone who has actually built working micro payments systems, this was of interest. Worth noting though that it's really just "document-ware" -- there's no code there[1], and their proposed protocol doesn't look like it was thought through to the point where it has all the pieces that would be needed.
[1] E.g. this file is empty: https://github.com/coinbase/x402/blob/main/package.json
> Worth noting though that it's really just "document-ware" -- there's no code there
That's not true. That project is a monorepo, with reference client and middleware implementations in TypeScript, Python, Java, and Go. See their respective subdirectories. There's also a 3rd-party Rust implementation[1].
You can also try out their demo at [2]. So it's a fully working project.
[1]: https://github.com/x402-rs/x402-rs
[2]: https://www.x402.org/
> As someone who has actually built working micro payments systems
The Github repo clearly has Python and Typescript examples of both client and server (and in multiple frameworks), along with Go and Java reference implementations.
Maybe check the whole repo before calling something vaporware?