Control over our data has become increasingly important.

With multiple recent high-profile data breaches and scandals, governments are taking extra measures to prevent their citizens’ personal information from falling into the wrong hands.

Data sovereignty, which has become a hot topic nowadays, is one of the concepts governments are using to protect citizens’ data.

But what is data sovereignty, why is it important, and how does it affect businesses and consumers?

Bear with us as we explore this important topic.

What Is Data Sovereignty?

Data sovereignty refers to the concept that the data an organization collects, stores, and processes is subject to the nation’s laws and general best practices where it is physically located.

In layman’s terms, this means that a business has to store the personal information of its customers in a way that complies with all the data privacy regulations, best practices, and guidelines of the host country.

If the business fails or refuses to comply with the host’s data privacy laws, the country’s government can impose a fine or force the company in another way to fulfill its requirements.

As part of data sovereignty measures, multiple countries have regulated how businesses can handle citizens’ data, including the locations and jurisdictions where organizations are allowed to store citizen data.

When a business transfers data of a citizen outside of the country, the third nation’s government can use measures (e.g., subpoenas) to access the user’s data, even though the citizen is a foreign national.

Since governments seek to prevent other nations from acquiring the data of their citizens, they have introduced data sovereignty measures that restrict how businesses can transfer personal information outside of the country.

Furthermore, the recent data protection law of the European Union, the GDPR, has implemented strict rules on how organizations handle the personal information of their citizens, even when the company processes data outside the region.

As a side note, data sovereignty is sometimes used in the context of indigenous societies.

Indigenous data sovereignty refers to the decolonization of the personal information of indigenous people that could play a key role in achieving autonomy for these societies.

Data Sovereignty vs. Data Residency

While data sovereignty and data residency are two terms that have similar meanings, it’s very easy to confuse them.

Data Residency

Data residency is when a business or government specifies the geographical location where its data should be stored.

Data residency requirements are often the result of policy- or regulation-related reasons.

Let’s see an example to understand this.

A nation has favorable data privacy laws that help enterprises in handling data-related processes in a convenient, predictable way.

Due to the favorable regulatory environment, businesses would choose this country to store their data.

A company may also include the location where its users’ personal information is kept in its data sovereignty policy.

An excellent example of a regulation-related data residency requirement is when a business chooses to store the data in a specific country due to its favorable tax environment.

To receive the tax benefits, the business needs to ensure that it does most of its operations within the nation’s borders. Therefore, it decides to store its data in a geographical location somewhere in the country.

Data Sovereignty

On the other hand, data sovereignty refers to designating the geographical location where the data is physically stored AND being the subject of that nation’s laws.

While data residency ensures that the data stays in the specified geographical location, data sovereignty makes sure that the information is subject to the legal punishments and protections of the country where it is physically stored.

The History of Data Sovereignty

To understand our topic, it’s essential to take a look at the most important events leading to data sovereignty’s rising popularity.

Where It All Started

Many credit the popularity of data sovereignty and the rise of related discussions to Edward Snowden’s leaks that exposed the US National Security Agency’s (NSA) PRISM spying program.

As part of the program, the US agency was collecting sensitive personal information – including photos, emails, social media login credentials, video calls, and other data – from tech companies in the United States (e.g., Facebook, Apple, Google, and Twitter).

The problem with the spying program was that the NSA did not only collect the sensitive personal information of US citizens but also from foreign nationals.

In addition to the NSA’s spying program, as per the US Patriot Act, the American government has the authority to access data that is physically stored within the country, regardless of its origins.This means that, for example, German citizens’ data are exposed to the US government if the information is physically stored within the North American country.

Amid concerns that their citizens’ data could fall into the hands of a foreign government, nations all over the world have introduced data sovereignty measures.

Microsoft’s Data Privacy Case vs. the DoJ

Microsoft’s case against the US Department of Justice (DoJ) was also a high-profile event that further highlighted the importance of data sovereignty.

After the DoJ ordered the tech company to grant access to emails stored in Ireland-based servers related to a narcotics investigation in 2013, Microsoft had refused to comply with the Department of Justice’s request.

Despite that Microsoft stated that complying with the request would break the data privacy laws of the European Union, the initial ruling ordered the company to fulfill the DoJ’s request.

However, later on, after Microsoft won the appeal and the DoJ changed its data-related policies.

Why Is Data Sovereignty Important?

Protecting Your Money or Your Data: Is There Really a Difference?

Let us show an example to understand why data sovereignty is crucial.

You open a bank account in the United States, where you regularly deposit your funds.

While you were of the belief that the financial institution would store your funds in the US, you get a call from the bank’s manager that your money has been moved to a third country as the regulatory environment is more beneficial there.

Later on, that nation’s government decides to close your bank’s local branch. For a reason, it confiscates all the funds that the bank’s customers held there, including yours.

Fortunately, due to the different financial regulations in place, the above-mentioned example could not happen with your money.

However, without laws that ensure adequate data sovereignty compliance, your personal information – which is as valuable as your money – could be as easily abused as your funds in the example.

Facebook’s Cambridge Analytica Scandal

Before data sovereignty and privacy were important, businesses could (more or less) use the personal information of their users as they liked.

This means that tech companies could sell your personal data without your consent to a third party for advertisement purposes.

A great example of the above-mentioned is Facebook’s scandal with Cambridge Analytica.

With an app called This Is Your Digital Life, Cambridge Analytica collected personal data from Facebook users who agreed to participate in surveys.

However, Facebook allowed the firm to collect the data of the survey takers’ friends on the social media platform, harvesting the data of millions of Facebook users without their consent, using the information predominantly for political advertising.

After the scandal was revealed in 2018 by a former Cambridge Analytica employee, the event sparked outrage among consumers and governments alike.

Furthermore, the infamous data leak emphasized the importance of data sovereignty, and governments all over the world have been turning an increased focus on this matter to protect their citizens against information leaks.

Which Countries Have Data Sovereignty Laws?

Now let’s take a look at some nations that already have data sovereignty laws in place.

Canada

Canada has 28 data privacy laws, which include federal, provincial, and territorial statutes.

Regarding Canada’s data sovereignty, we should mainly focus on the Personal Information Protection and Electronic Documents Act (PIPEDA) regulation.

Based on Canada’s data sovereignty laws, an organization remains responsible for the protection of the data it transfers to a third-party (even though the service provider is the one processing or handling the information).

Furthermore, Canadian businesses have to reference in their privacy policies and procedures whether they transfer data to third parties outside of the nation’s borders.

The Quebec Privacy Act is more strict with local organizations as they have to ensure that personal information transferred to third parties outside the state would be used only for the intended purposes of the company.

At the same time, the state’s data sovereignty regulation prevents service providers from transferring data to third parties without consent.

If an organization cannot ensure that the third-party service provider outside of Quebec has proper data protection measures, it must refuse the transfer.

California, United States (CCPA)

It’s also important to mention the California Consumer Privacy Act (CCPA), one of the most prominent data privacy laws in the United States.

After becoming effective on January 1, 2020, the CCPA introduced a set of privacy laws for organizations doing business in California that fit one of the following criteria:

1. Have an annual gross revenue of over $25 million
2. Buy, receive, or sell the personal data of at least 50,000 households or consumers
3. Gain over 50% of their annual revenue from selling the personal data of consumers

As per the CCPA, organizations have to disclose the personal data they collect, the purpose of the collection, as well as the third parties they share the information with.

Consumers can demand the deletion of their data from businesses, and they are also able to opt out of their personal information being sold.

In the latter case, the CCPA prohibits organizations from raising the price or changing the level of the service for consumers who don’t want companies to sell their data. However, the data privacy law does allow businesses to offer financial incentives to their customers in exchange for data collection or the ability to sell their personal information.

Furthermore, if the CCPA’s privacy guidelines are violated by an organization, consumers can sue the company.

When California authorities discover a violation of the CCPA’s guidelines, businesses have 30 days to comply with the privacy laws after the regulator’s official notice.

If an organization fails to resolve its issues within that time frame, California regulators can impose a fine of up to $7,500 per record. As there is no upper limit for the fine, a business that processes the data of millions of consumers could pay billions for violating the CCPA.

Unlike the EU’s GDPR, the CCPA does not restrict international data transfers.

European Union (GDPR)

When it comes to data privacy laws, the European Union’s General Data Protection Regulation (GDPR) is what comes to most people’s minds.

After its approval in 2016 by the EU Parliament, the GDPR requires all organizations – within and outside of the European Union – to comply with strict data privacy rules if and when they collect, process, or store the personal information of EU citizens.

We will discuss data sovereignty and GDPR more thoroughly later in this article.

Germany

Germany has been amongst the leaders of data privacy and protection.

Apart from the EU’s GDPR, the European country has implemented the new German Privacy Act (BDSG-new) that restricts data transfers to third countries.

According to Germany’s data sovereignty laws, companies that process the nation’s citizens’ personal information have to fulfill the German government’s data protection requirements, even if they are located outside the country’s borders.

As per the BDSG-new, those who infringe the data protection laws of Germany – for example, illegally transferring data to third parties – could face criminal charges with up to three years in prison.

France

Like Germany, in addition to the GDPR’s rules, France has implemented its own data sovereignty laws to protect its citizens.

Based on France’s Data Protection Act 2, when an organization interacts with the personal information of its citizens – even if it processes the data outside the nation’s borders – it must comply with French regulations in addition to fulfilling the GDPR’s requirements.

Australia

In Australia, data sovereignty laws come in the form of the Federal Privacy Act of 1988 and its Australian Privacy Principles (APPs).

Similar to Canada’s data sovereignty measures, the organization that transfers the data to a third party is responsible for how that service provider handles the information and whether it complies with the APPs.

Also, Australian organizations have to ensure that the third party does not breach the APPs while it processes the data.

Data Sovereignty and the GDPR

The GDPR is one of the most prominent data privacy laws that governments have implemented to protect their citizens’ personal information.

For breaching the GDPR, organizations can be fined by as high as 20 million EUR or by the equivalent of 4% of their global turnover.

After becoming active in 2018, EU authorities have imposed fines of nearly 500 million EUR on organizations that have breached the GDPR’s data protection requirements.

In addition to rules like the right to be forgotten, the GDPR also includes data sovereignty measures.

According to the GDPR, organizations that collect or process the personal information of EU citizens have to store the data within the region or in a jurisdiction that offers similar data protection levels.

Furthermore, no matter where the company stores, collects, or processes the data, it has to comply with the GDPR’s rules in case it handles the personal information of European Union citizens.

What Does Data Sovereignty Mean for Consumers?

From the consumer’s point of view, data sovereignty requirements regulate how businesses interact with their customers’ personal information while preventing third-party service providers from abusing the data.

While data sovereignty requirements are not introduced in every nation and can’t fully protect user data, proper regulations discourage organizations from abusing their users’ personal information.

What Does Data Sovereignty Mean for Businesses?

While consumers are often those who benefit from data sovereignty requirements, businesses must find ways to comply with the relevant data privacy and security laws of each nation.

Therefore, in addition to knowing local, regional, and international data privacy laws, organizations have to develop a new or use existing infrastructure for data collection, processing, and storage that aligns with all the relevant data sovereignty requirements.

Data sovereignty measures could also make things complicated for companies that store their data in the cloud.

For example, an Australian organization has two options to comply with its nations’ data sovereignty laws.

1. The business can choose a cloud service provider to store and process its data, but it has to ensure that the third party is complying with all the relevant laws and requirements; OR
2. The business can choose a cloud service that operates as well as stores and processes data exclusively within the national borders of Australia to prevent sensitive personal information from leaving the country.

It’s clear that whichever option the business chooses, it requires some extra legwork from the company’s side.

However, doing so helps ensure that the data of the nation’s citizens remain safe(r) with data sovereignty.

Data Sovereignty: A Crucial Concept That Requires Immediate Attention

It’s good to see that multiple governments are implementing data sovereignty measures to ensure that organizations treat their citizens’ personal information appropriately.

However, despite the strict laws, we are still very far from reaching true data sovereignty.

Businesses can still take advantage of our personal information and use it to increase their profits by selling our info to data vendors while we receive nothing in return.

Permission is determined to end this by creating a next-generation, blockchain-based advertising platform where users have full control over their data.

If a user gives permission to an advertiser to use his data or leverages his time to engage with the advertiser’s campaigns, he gets rewarded in Permission.io’s ASK cryptocurrency.  The user can hold, exchange, or spend the currency in the Permission.io Store.

On the other hand, by only targeting consumers with ads they’ve granted permission for, businesses earn the trust and loyalty of their users while building long-term relationships and achieving a holistic view of their customer’s needs in real-time.

Take a look at Permission’s official website to learn more about the win-win advertising model (including the innovative Permission Browser Extension) that is changing who controls and profits from our data.

There are always times when you could use some extra cash. Whether you’re chipping away at student debt or covering some of your daycare bills, knowing the best online destinations for making a few extra dollars when you need them is good to have in your back pocket.

There are many survey apps out there, so we’re not going to throw a bunch at you. Instead, we’ve hand-picked a few of the best based on pay potential, usability, and reliability. All of our research was focused on minimizing time-in and maximizing money-out.

Here’s our list of the best paid survey apps to make money with:

1. Prolific

What Is Prolific?

Prolific is an academic site where universities and Ph.D. students pay participants to complete surveys necessary to their research. It’s really fun for participants because they get to be a part of interesting research, and the pay is good too.

How Does It Work?

After you sign up for an account, you fill out a series of demographic questions and then receive email notifications for surveys you qualify for. Once you receive a notification, you go to their portal and sign-up to take the survey. These surveys are usually a bit more involved, but you’re getting paid more and the questions are more interesting than typical demographic surveys.

How Much Can I Make?

Prolific aims for a minimum of $6.50 an hour and people report $30-$40 per month, but ultimately it depends on how much time you put in, how quickly you complete surveys, and how many surveys you qualify for. Prolific generally pays higher than other survey apps, though.

How Can I Get Paid?

You can cash out on PayPal or Circle.

Pros of Prolific

1. Signing up is easy and free.
2. Payment is transparent and fast.
3. You earn cash instead of points or gift cards.
4. Surveys are quick and easy.
5. Academic surveys tend to be more fun.
6. You are guaranteed payment once you start a survey.

Cons of Prolific

1. Doesn’t always do the best job of letting you know when you qualify for a survey.
2. Doesn’t have a specific native app, but there is a way to receive survey notifications via an Android-only Chrome extension.
3. Completing surveys on your computer is easier than on your phone. There are rumors of a Prolific app coming soon.

Where Do I Sign Up?

Sign up for Prolific here.

2. Google Opinion Rewards

What Is Google Opinion Rewards?

Google Opinion Rewards is a Google Program that pings users to fill out surveys in return for credit they can spend in the Play Store.

How Does It Work?

Everything is handled within Google’s fantastic app. You receive notifications to fill out surveys or answer questions. According to Google, questions can range from, “Which logo is best?” and “Which promotion is most compelling?” to “When do you plan on traveling next?” After you finish the prompts, your account is automatically credited with Google Rewards cash.

How Much Can I Make?

Google offers up to $1 in Google Credit per paid survey, and their surveys are usually short. I’d use this app more as a way to buy Kindle books or pay for apps and/or subscriptions you’re already in the habit of buying.

How Can I Get Paid?

Your earnings can only be spent in the Google Play store, so it’s best to use this to pay for subscriptions you’re already using or to buy books. Saving on entertainment is still saving.

Pros of Google Opinion Rewards

1. Fantastic app.
2. Reliable.
3. Short and sweet.
4. Good credit rewards for time spent.
5. Reliable notifications.

Cons of Google Opinion Rewards

1. Can only spend in the Google Store.
2. Limited survey availability — better for a reactive approach instead of proactive survey mining.

Where Do I Sign Up?

Sign up for Google Opinion Rewards here.

3. dscout

What Is dscout?

dscout is a platform that connects brands with users to create in-depth, video-based research experiences.

How Does It Work?

It’s free to sign-up, and everything is handled through their app. After you create an account, you can start applying for “missions.” These missions are usually 30min to an hour in length and involve you taking a video of yourself either experiencing a product or answering questions about a product or experience.

How Much Can I Make?

Typically $40-$100+ per study that lasts around an hour, but spots fill up quickly and you won’t qualify for every opportunity.

How Can I Get Paid?

You can get paid through PayPal, by opting for gift cards, or sometimes getting product samples.

Pros of dscout

1. Great, modern platform with a good reputation.
2. Great pay when you qualify.
3. Fun surveys and experiences.

Cons of dscout

1. Must be comfortable on camera.
2. You need to have a decent smartphone.
3. You have to be in a quiet place without distractions.
4. Spots for the “missions” tend to fill up pretty quickly, so you have to stay on top of applying.

Where Do I Sign Up?

Sign up for dscout here.

4. UserTesting

What Is UserTesting?

UserTesting is a “human insight” platform that enables brands to view screen-recorded experiences of their product or website by actual humans. This lets them test changes before implementing them on a larger scale.

How Does It Work?

You sign up via email either on their website or through the User Testing mobile app, and then you sign up for tests manually. You can set up notifications for new testing opportunities, and the stronger your user rating the more tests you’re accepted for, generally.

How Much Can I Make?

You get paid $10 per 20-minute test and can make even more when you’re interviewed, and some users report making hundreds of dollars a month. It just depends on how many reviews you manage to qualify for — the competition is pretty fierce.

How Can I Get Paid?

You get paid in cash via PayPal exactly a week after you complete a test or interview.

Pros of UserTesting

1. More fun than traditional surveys.
2. Better pay than surveys.
3. Great chrome extension that makes recording simple.
4. You always get paid on time and in cash.

Cons of UserTesting

1. Takes time to build up a user rating good enough to attract enough tests.
2. Tests are really competitive and are often gone within minutes.
3. The mobile app isn’t as well-designed as it could be.

Where Do I Sign Up?

Sign up for UserTesting here.

5. Survey Junkie

What Is Survey Junkie?

Survey Junkie is a survey-only app that pays survey responders small amounts in return for filling out surveys for their brand partners.

How Does It Work?

You can sign up online or on their mobile app. It takes just a few seconds, and then you’ll have the opportunity to fill out your profile in return for points. After you get set up, you can view the available surveys and get started. It’s a straightforward platform.

How Much Can I Make?

Survey Junkie’s points translate directly into cents, so 1 point = 1 cent. Most users report around $2-$5 an hour, and surveys take from just a few minutes to up to 20 to get through them.

Sometimes you can also qualify for focus groups that pay between $50-$100.

How Can I Get Paid?

You can spend your points on gift cards or get paid out via PayPal.

Pros of Survey Junkie

1. You can earn a bunch of points off the bat by completing various tasks.
2. Can get paid out in cash.
3. You can combine your surveys with its browser for extra earnings.
4. Nice, modern app.
5. Low payout threshold ($5).

Cons of Survey Junkie

1. Payouts are much lower than the above sites.
2. Survey offerings can sometimes be limited.
3. It strictly surveys, so you can’t get extra points by product testing, etc.

Where Do I Sign Up?

Sign up for Survey Junkie here.

6. Swagbucks

What Is Swagbucks?

Swagbucks is the biggest player in the survey and free reward marketplace. It’s backed by Yahoo and offers rewards for surveys, searching the web, watching videos, opting into cashback product offers, and more.

How Does It Work?

Swagbucks is all about collecting points. There are a bunch of different activities you can complete to collect points, from watching videos to completing surveys. Your best bet is to take advantage of the daily polls, offers, and featured surveys. There are a lot of ways to waste time on Swagbucks, so taking the time to develop a strategy that minimizes your effort is ideal.

How Much Can I Make?

Swagbucks is a reliable platform but is far from lucrative. $10-$20 a month with minimal effort is fairly standard, but some power users claim to make hundreds of dollars a month. It depends on the opportunities available and how well you can play the system, but don’t expect to make a lot.

How Can I Get Paid?

You can spend your points on gift cards or get paid out via PayPal.

Pros of Swagbucks:

1. Trustworthy platform.
2. Many ways to earn besides surveys.
3. Good cashback offers.
4. Can combine with their browser to earn passively and actively.

Cons of Swagbucks:

1. Surveys take a lot of time and don’t reward you with a lot of cash.
2. You don’t always qualify for surveys.
3. It’s harder to make this platform work for you than the others, but it can be done with the right strategies.

Where Do I Sign Up?

Sign up for Swagbucks here.

Pro Tips for Making Money on Paid Survey Apps

1. Use Them to Fill Time When You’re Bored

Many sources quote $3-4 an hour as the average earnings on big survey app sites. While this can add up over time, it’s not going to be the best use of your time. Instead, use survey apps to fill otherwise non-monetary gaps like waiting for your kids at school or sitting in the dentist’s office, etc.

2. MIX Passive Earners With Active Earners

This goes a bit beyond strictly paid survey apps, but there are many companies that also pay you for your browsing & choices around shopping. If you can have a healthy flow of more specific, higher-paying survey opportunities mixed with “always-available” apps like Swagbucks AND have an extension like Qwee rewarding you for your natural behavior on browsers, then you’ll have the best mix of paying opportunities.

3. Always Aim for Specificity

Surveys that only apply to a small group of people always pay better. Whatever app(s) you use, be as specific as possible about who you are and the experience you have. Surveys that are looking for “25-34 non-white teachers with children under 10” will pay much more than “looking for women.” Aim for surveys you are uniquely qualified for.

4. Set Up a Separate Email Address

Depending on how many apps you sign up for, you could be flooded with survey opportunities. I recommend setting up a separate email address like nathansurveys@gmail.com to have one place to collect all of those messages.

And then if you want to take it to the next level, set up a filter that notifies you when certain keywords related to your expertise are found in emails. E.g., if you have a non-profit background you could ping your other email address when “non-profit” is found — that way you know you should respond to that survey opportunity.

5. Diversify the Types of Surveys and Reviews You Do

The opportunities in survey apps can vary quite a bit. From walking through websites with sites like UserTest to getting actual products and reviewing them on video with dscout, it’s mentally refreshing to diversify your work.

Rapid-Fire FAQ About Paid Survey Apps

What is the highest paying survey app?

There is no one app that pays the most. Each app offers varying opportunities and the pay scale for those opportunities can change dramatically, although apps that require you to record video usually pay more.

In general, the more you can qualify for surveys that are uniquely fitted to your demographic the better. I.e., a survey looking for random people regardless of who they are to fill out what they think of a logo will pay much less than a survey asking ex-accountants to review a new accounting software. Use your resume to your advantage.

Are survey apps worth it?

That answer is relative to your situation. There are many great ways to make money online besides surveys, but knocking out surveys in what would otherwise be wasted downtime is absolutely worth it. Plus, if you can sign up for enough legitimate survey sites and only fill out the high-paying, high-specificity surveys, you can definitely make it worth your time.

Which paid survey sites are legitimate? Are paid surveys even safe?

There are many legitimate and safe survey sites, but there are also many predatory sites. The best way to evaluate a site is to take a look at their user reviews & user experience. If they don’t have many reviews or if the app itself seems really hacked together, stay away!

How long do paid surveys usually take?

Many last around 5-15 minutes, but surveys can range anywhere from just a few short minutes to 60min+.

Do I need to pay tax on online surveys?

You definitely have to report it. Whether or not you actually pay taxes on it will depend on your financial situation & whether or not you claim expenses around the income.

Can you make a living off of surveys?

Not really. It’s smart to look at surveys as low-intensity, low-labor work that you can tap into to pad your main source of income. We don’t recommend attempting to make a liveable wage off of surveys.

Do the best survey apps vary for Android and Apple?

Not really. Most of the big players are on both!

What if We All Got Paid for Our Data?

What if you owned your data instead of Facebook, or Google, or any other internet service that takes your data and sells it for a profit?  What if you got paid for the targeted advertising these tech giants sell at your expense?  You deserve a piece of that, don’t you?

Permission has created a cryptocurrency that enables permission-based engagement and that compensates you for your data. The Permission Browser Extension pays you for watching ads as you go about your everyday internet browsing. And that’s just the beginning.

See what else we’re up to.

Have you heard about data residency?

If you haven’t, it’s a concept that determines where different organizations store your data.

Some nations have stricter data protection laws, while others have implemented only minor measures.

As you don’t want your data to fall into the wrong hands, the location of your personal information is crucial.

In this article, we will discuss what data residency means and how it differs from data localization and data sovereignty. We’ll also explore the measures different nations use.

What Does Data Residency Mean?

Data residency is where an organization – government body, industrial body, or business – specifies the geographical location of their choice for where they store their data.

There are various reasons why an organization would do this:

1. Tax benefits. In this case, a nation’s government may offer a beneficial tax environment for a business. However, in exchange, the company would ensure that a significant part of its operations stays within the country’s borders. As data storage is an important component of business operations, it may choose to host its data in the country.
2. The business could also include data residency in its company policy to make it transparent for its customers where their data is stored.
3. The company may also choose to host its data in a specific country due to financial (e.g., it’s cheaper to set up a data center or use a local data service provider’s services) or regulatory (e.g., the government has beneficial data protection laws) reasons.

Data Residency vs. Data Localization vs. Data Sovereignty

Have you heard of data localization and data sovereignty?

These terms are often used interchangeably with data residency frequently being used in the wrong way.

While data residency, data localization, and data sovereignty are closely related, they refer to concepts with different meanings, which could create some confusion amongst both consumers and businesses.

Let’s resolve the confusion and get things clear now.

Data Residency

The first and least restrictive concept is data residency, where a government body, industrial body, or business simply specifies the geographical location where it stores its data.

As illustrated in the last section’s examples, with data residency, the organization has a choice as to where it wishes to store its data.

Data Sovereignty

On the other hand, data sovereignty is a more restrictive concept. It represents the idea that data is subject to the nation’s laws where it is collected, processed, and stored.

Therefore, businesses have to comply with local data protection laws to avoid getting fined by the government.

Data Localization

Data localization is the most restrictive concept of the three.

While data residency gives organizations a choice to specify the geographical location where its data is stored, data localization refers to keeping the data of businesses within the borders of a country.

The concept almost always refers to the storage and creation of the data, and some nations that have implemented data localization laws require organizations to keep only the copy of the data within the country.

If there’s a valid reason, such data localization laws allow the government to audit its citizens’ data without requiring the nation’s authorities to interact with other governments.

On the other hand, some nations have implemented very restrictive data localization laws, prohibiting the data from crossing the country’s borders.

For example, Russia’s On Personal Data Law (OPD-Law) requires organizations to store, retrieve, and update data exclusively in data centers within the nation’s borders.

While stating that their goal is to protect their citizens’ data, these nations often implement strict data localization measures to secure a market advantage for local data centers that align with their data protectionism-related goals.

By doing so, such laws restrict the international flow of data. Therefore, critics argue that it prevents organizations from realizing the full potential of their data while contributing to “digital factionalism” and the “splinternet.”

Data Residency and the GDPR

The General Data Protection Regulation (GDPR) is among the world’s most popular data privacy laws.

As per the GDPR, companies that interact with the personal information of European Union citizens – both within and outside the EU – have to comply with strict data privacy laws.

While EU authorities can impose fines up to 20 million EUR on businesses or acquire 4% of their total global turnover as a penalty for non-compliance, there are no data residency laws in the GDPR.

Therefore, as per the EU data residency laws, organizations are free to choose where they host the data of European Union citizens.

However, businesses still have to comply with the EU’s (mostly data sovereignty-related) laws that require companies to fulfill specific requirements when transferring data outside of the European Union.

For example, a business could only transfer data to a third country if that nation has similarly adequate data safeguards as the EU or the company has a valid legal reason.

As of today, the EU has issued 13 adequacy decisions.

This means that European Union authorities (at least partially) consider these nations to have satisfactory data safeguards, allowing companies to transfer the personal information of EU citizens to these locations.

Data Residency Requirements by Country

Australia

According to the Personally Controlled Health Records Act of 2012, all personal medical information in Australia has to be stored in local servers.

While the law ensures that foreign governments are unable to access Australian citizens’ personal health records, the Oceanic nation’s data residency law prevents medical service providers, such as IBM Watson Health, from offering solutions to the nation’s citizens and organizations.

Canada

In Canada, two provinces (British Columbia and Nova Scotia) require public bodies (e.g. schools, public agencies, hospitals) to store their personal data within the nation’s borders where the data can only be accessed from the country.

China

China has one of the strictest data residency and localization laws on the globe.

In addition to restricting access to certain websites as part of the Golden Shield Program (also referred to as “the Great Firewall of China”), organizations have to comply with a wide range of data residency measures.

For example, companies offering e-banking services in China have to locate their data servers in the Asian nation. At the same time, Chinese personal financial information can only be analyzed, stored, and processed locally.

Also, the data of internet-based mapping services, as well as medical and health records, have to be kept in China.

Certain companies also have to comply with a cybersecurity law that prohibits personal information and important business data from leaving the country.

France

In France, data produced by local and national public administrations have to be stored with cloud services that are within the country’s borders.

It is also illegal in the European country to move information that is connected to legal proceedings outside of the nation.

Germany

Germany has similar views on data residency as France, advocating the idea of national clouds where personal information can be stored locally within its borders.

While data residency laws can vary by state, all organizations within Germany have to store accounting data in the European country.

Furthermore, organizations and individuals liable for taxes in Germany have to keep their accounting records within the country’s borders (with some exceptions).

Russia

Similarly to China, Russia has implemented strict data residency and localization laws.

As per the 2015 Personal Data Law, the data operators that collect personal information from Russian citizens are required to do all their data-related operations using databases that are physically located in the nation.

In addition to requiring companies to store all telecommunications data in the country for six months, the Russian government could impose a fine or shut down the services of businesses that refuse or fail to comply with the nation’s data residency laws.

Data Residency: An Important Concept Influencing Where Your Data Is Stored

As organizations specify the geographical location to store data, data residency has a great influence on where businesses keep your personal information.

Since data residency laws vary by country – for example, there are strict requirements in China and Russia while minimal regulation in Canada and the EU (GDPR) – it’s important to know where the services you use are storing your data.

If that nation has data sovereignty laws, businesses have to comply with them, which means that the government may access your personal information for any (valid) reasons.

While proper data sovereignty rules can help consumers protect their personal information, strict data localization laws could do more harm than good (e.g., the government can monitor the data easily while restricting the international flow of information).

Achieve Full Control Over Your Data With Permission

Permission, the advertising platform of the future, uses blockchain technology to achieve true data sovereignty by enabling full control over its users’ personal information.

Consumers are free to choose whether and how advertisers can use their data.

In exchange for sharing their personal information and engaging with advertising campaigns, users are rewarded in ASK, Permission’s native cryptocurrency, which they can spend on the Permission platform, hodl, or exchange.

Sounds great, huh?

Now check out Permission’s official website to learn more about this new blockchain-based advertising model and its innovative Browser Extension! You can also join the discussion via the Permission.io Telegram channel.

There are enough arguments about “what Web 3.0 is” to make it impossible to point to a single authoritative definition. But that’s fine, it means we can propose our own definition of Web 3.0.

Here it is:

Web 3.0 is the third generation of the Internet—a global network that permits intelligent interactions between all its users and devices.

Now to explain ourselves…

Web 1.0 was the early Internet that persisted until about 2000. At first, websites were just places you could read the information posted on servers and interact with such servers in simple ways. There were search engines, and there were e-commerce sites like Amazon and eBay.

Web 2.0 arose following the turn of the century. It was far more interactive, far more collaborative, and far more capable. There were technical reasons why, not least of which was the rapidly improved bandwidth available to users, and servers. It is this generation of the web that gave us smartphones and mobile computing. Web 2.0 could support near real-time interactions and thus collaborative activity was feasible. Social networks like Facebook and Twitter were part of this, but so were graphical multiplayer games. It also included the birth of Big Data and the machine learning algorithms that sifted through it.

Web 3.0 is defined by intelligence. This intelligence is not just in interactions between people and websites, but between software and software. And, there’s more than that. The difference between Web 2.0 and Web 3.0 has multiple aspects.

We will discuss them one by one.

The Underlying File System

Web 1.0 and web 2.0 are defined by the HTTP protocol and the simple file systems it provides access to. The protocol enables resources to be accessed (via a URL) and also files, particularly HTML documents.

It is a client-server protocol that currently provides the foundation of all data exchanges over the Internet. The term client-server means that there is a requesting side (a client – usually a web browser) that calls for information from a server (a computer that serves up information – usually web pages or parts of web pages).

The protocol works by virtue of Domain Name Servers (DNS) servers. There is a large network of these which includes thirteen root servers.

You can think of the DNS servers as a postal service for the request you make from your browser via the HTTP protocol. They deliver that request to the address you specify, which will be something of the form:

http://www.thewebsite.com/the-page-I-want

When thewebsite.com receives this message, it sends you a message back, the page you want, using the same postal service.

It may be more complicated than that. In reality, it may involve multiple messages, including ads that you don’t want to see. Nevertheless, it all happens through a kind of postal service.

With Web 3.0 that mechanism will change. Indeed, we might be inclined to call it Internet 3.0.

The technology that will most likely replace the current DNS system goes by the name of the InterPlanetary File System, IPFS for short.

Why wasn’t it called the InterStellar Files System or even the InterGalactic File System? Perhaps its designers lacked ambition.

The IPFS is also a postal system, but it is not centralized around a group of root servers like the HTTP protocol. The goal in the design of IPFS, which is a child of blockchain technology, was to create a peer-to-peer file system that worked after the fashion of BitTorrent, the file streaming service that is frequently used to download and share videos and music.

IPFS separates the act of seeking information from the act of retrieving it. It does so through the magic of content addressing.

Content addressing is a math trick where you apply a hashing algorithm to some content (such as a web page) and it generates a unique key that acts as its address. To cut a long story short,  you provide the network with that address, and a server that holds the information sends it to you.

IPFS has lots of advantages over HTTP. Here’s a list:

1. It is more secure (and SSL is no longer required).
2. It keeps all the versions of a file, as well as the file.
3. The data can be distributed in many places. For example, a website does not reside on a particular server and may not even have a specific origin server, but it’s there somewhere in the file system.
4. Because the address relates to the content, the address never needs to be updated when the content is moved.
5. There’s no real distinction between client and server. Remember it’s like BitTorrent where there are multiple servers both holding and requesting data, including your own device).
6. It is significantly faster than HTTP.
7. It is transport-layer agnostic, which means it can work over any transport layer (from TCP to Bluetooth)

Assuming IPFS is successful, all of these advantages become Web 3.0 advantages.

Digital Identities

Digital identities are another technology that was spawned by the blockchain, and it may become the most important feature of Web 3.0. The point is that Web 2.0 is infested with cybercrime—dark deeds of every description from identity theft to click fraud.

It happens because the connection between two computers is not properly authenticated, and currently cannot be authenticated. Let me spell it out.

With web 2.0 a server never knows for sure that the client software accessing it is what it pretends to be—a browser under the control of an identifiable human being. Neither, on the other side of the equation, does the browser know whether the server and the files it is accessing are the ones it intends to access.

However, if everything involved in such an interaction had a verifiable identity, fraud and deception would be far more difficult to perpetrate. With Digital IDs, individuals can only have one verifiable identity, since each ID has to be linked to a unique credential, like a birth certificate. Similarly, organizations can only have one verifiable identity. As regards everything else (hardware and software) involved in the interaction between a client and server, these things can be directly tied to a unique ID belonging to an individual or an organization.

What is more, because of a brilliant technology that goes by the name of zero-knowledge proof, it is possible for either side to prove they are authentic without even revealing their identity.

Digital IDs enable two important features of Web 3.0:

1. The severe reduction to the point of elimination of cybercrime.
2. Individuals will be able to manage and grant access to their personal data.

(As you have probably realized, Permission‘s business model is strongly connected to this aspect of Web 3.0)

Micropayments

The blockchain is fundamental to Web 3.0, in several ways. We have mentioned two so far: bullet-proof Digital IDs and a distributed file system. Perhaps its most important contribution is its primary use, its ability to create cryptocurrencies, and particularly the ability to use such currencies to make micropayments.

This stems from the low cost of a cryptocurrency transaction. In the non-blockchain world, the cost of a credit or debit card transaction is calculated as a percentage of the value plus a fixed amount (say, 10 cents). The seller pays. So sellers are unlikely to allow credit card payment for products with a ticket price less than about $10.

The cost of a blockchain payment is generally much lower. In practice, it varies quite a lot between different cryptocurrencies as it depends on how the blockchain is organized. Low-cost examples include an EOS transaction at $0.0105 and a TRON transaction was $0.0000901 (measured in March 2018).

With such low transaction costs, it becomes possible to sell things for a few cents. A few cents could be the fee charged for reading an article from a national or local newspaper or a magazine. Being able to charge per article that way will revolutionize web publishing. Low-cost sales of products and services will be a reality with Web 3.0.

Trust

Some might argue that the blockchain’s most important contribution is automated trust. This stretches beyond the security that the blockchain can deliver through digital IDs by building a web of trust.

Some blockchains enable the creation of “smart contracts”, programs that are attached to the blockchain and that execute when triggered by a specific blockchain event. The important point about smart contracts is that the program code is the contract.

This makes smart contracts far more certain than a legal contract. Legal contracts are enforced through the legal system, which varies in reliability from one place to another but is never perfect. The outcome of a challenge to a legal contract is never certain.

However, smart contracts can be trusted 100%. A simple example of a smart contract is given by the movement of goods through a supply chain. Goods are dispatched with an RFID tag that reports their location when read. When the goods reach specific locations the smart contract can automatically enact payment—for transport or for warehousing or import duties. Payments are thus predictable and can be trusted 100% to occur.

Naturally, smart contracts can be far more complex than that example. They can cover many situations that are currently covered by legal contracts, diminishing the possibility of fraud.

Semantic Data and Information

Another facet of Web 3.0 is the presentation of data in a semantic form. We will not dive into the technology behind that here, but you can get a sense of it from Google’s Knowledge Graph which places blocks of organized data to the right of some of your search results.

If you don’t recognize what I’m talking about, do a search on “Galileo’s trial”. Notice that Google gives you a succinct summary of your search topic, as well as the usual collection of links. That’s the work of Google’s Knowledge Graph.

But now try a search on “Who attended Galileo’s trial?”

At the moment such a question is too complex for Google to unravel. However, it could if it had a greater grasp of the meaning of the question and if the websites it surveys organized their metadata in a more semantically friendly manner.

OK, that’s academic, not economic.

But now think about searching for products. It’s here where the commercial magic of Web 3.0 steps in. Nowadays in the US, more product searches happen on Amazon than on Google. Yet neither of these Web 2.0 giants can answer detailed product questions like “what is the best deal available for a 55” HD TV for delivery within 2 days.”

From the consumer’s perspective, a practical answer to such a question would serve up a range of information, offering possible choices rather than just a set of web links.

That kind of capability will be part of Web 3.0 by virtue of semantic technology. It will save buyers and sellers a good deal of time in the sales cycle.

Software Negotiating With Software, Bots for Everyone

The paradigm we have become accustomed to is that of “browser and website”.

We have browser plugins that provide certain services for us (clipping copies of web pages, filling in passwords, ad blocking, and so on.)

On the website side of the equation, websites have been fairly unresponsive in interacting with their visitors, with the exception of the web giants with the big bucks who can afford Big Data AI and thus software that responds to the user in real-time.

The paradigm for Web 3.0 will be different. The individual user will begin to regard what we now call a browser as a kind of operating system that runs applications. What we now think of as plugins will become our applications, and while they will still be able to show us documents or videos, as before, some apps will be capable of much more.

For example, a shopping application will help its owner buy, say a car, by gathering data from him or her and then going out to find suitable links for the user to visit. Ultimately such software should be able to help the user through the whole buying process, including negotiating a reasonable price.

Just as nowadays hackers and some websites run bots, in Web 3.0 the user will be able to buy and configure bots that serve them directly. Bots are, after all, just applications.

This development may take a while as it depends on the proliferation of digital IDs and also good semantics.

AI and Big Data, for Everyone

Most web users are painfully aware of digital ads that follow them around the web or the ads that Facebook drops before their eyes or Amazon’s efforts to tempt them to buy something else “they might like” when they are about to place an order. Among the websites with big budgets, the twin weapons of Big Data (your data mainly) and AI provide commercial firepower that puts the customer at a disadvantage.

However, intelligence can cut both ways. AI could equally well serve individuals if they take control of their data and collaborate in finding effective ways to exploit it. In short, with Web 3.0 the possibilities of AI are likely to broaden, but to the disadvantage of the big guys.

3D Graphics

The advent of 3D Graphics is a natural consequence of graphical software evolution. If you are not sure what 3D graphics is, here’s an example. Such animation owes a great deal to WebGL (Web Graphics Library), which is a JavaScript API that can render interactive 2D and 3D graphics within web browsers without the need for any plug-in. It is based on the OpenGL graphics language and uses elements of HTML5. An important technical detail is that it can exploit GPUs and thus performs well.

3D Graphics will make an impact outside the obvious areas of online games and entertainment. It is likely to be used in education, health care, real estate, and other areas of e-commerce. It’s also likely that, in time, individuals will design and use their own 3D avatars.

While you can view blockchain-related technology (Distributed file systems, Digital IDs, micropayments, etc.) as related developments, 3D Graphics is simply an evolutionary development. It was inevitably going to develop in a given time; it just happens to be coming to maturity at the same time as these other Web 3.0 technologies.

Complete Connectivity (Ubiquity)

Over time, Web 3.0 will remove many of the inconveniences of Web 2.0.

We can expect the Web to be available on any device (pad, mobile phone, desktop) seamlessly. The Internet of Things will join the party, with every household device controllable from anywhere and, where appropriate, able to be used as a web access device.

Ultimately, this means that your identity, and most things you own, and all your data, as well as every software capability you have a right to use, will be linked together and able to work together.

When Will Web 3.0 Happen?

New technology generations are never born on a specific date. Even Web 1.0 didn’t happen on a particular date.

You could say it began as soon as the first browser was released in a usable condition. But at that time there weren’t many websites. You might, therefore, claim that it was born when websites began to multiply. But realistically it didn’t happen until the first search engines appeared. However, you might want to argue that it didn’t occur then, but when the first true e-commerce sites began working.

The point is that it slowly emerged. Web 2.0 with its social networks, multiplayer games, and big data algorithms also took a while to come of age.

Web 3.0 will be the same.

Perhaps you will wake up one morning and realize that your browser embodies a set of bots that do really useful things for you, that you have a Digital ID and that you can interact intelligently with the Internet. When that happens you will have a right to declare: “Oh yes, this is Web 3.0.”

Did you know there’s a way you can cut your unnecessary expenses while growing your Bitcoin holdings?

Yep, that’s right. It’s called stacking sats. And there are some cool ways to stack sats without paying a penny.

Sounds awesome, doesn’t it?

In this article, we will explore the exciting world of stacking sats while giving you tips to convert the expenses you don’t need into BTC.

What Does Stacking Sats Mean?

“Stacking Sats” refers to regularly accumulating small amounts of Bitcoin over time via either buying, earning, or mining BTC. “Sats” refers to satoshis, the smallest unit of Bitcoin.

The unit was named after BTC’s creator, Satoshi Nakamoto, who launched the world’s first cryptocurrency in 2009 after publishing the official Bitcoin whitepaper in late 2008.

How many sats are in a Bitcoin?

1 Bitcoin = one hundred million satoshis

1 Satoshi = 0.00000001 bitcoin

At the time of writing this article, one BTC trades at $8,870, with one satoshi being $0.0000887.

How Did the Movement Start?

Before blowing up the cryptocurrency community, the term “stacking sats” started with a tweet in late December 2017.

Later on, the term was mentioned on several occasions in the crypto community.

However, what helped it become popular was Bitcoin advocate Matt Odell’s “Tales From The Crypt” podcast in February 2019. In that episode, Odell advised his listeners to stack sats by earning or purchasing Bitcoin on a regular basis.

As a result of the popular podcast episode, crypto enthusiasts have started to post screenshots on Twitter as proof for how they’ve accumulated BTC using the #stackingsats hashtag on the social media platform.

After stacking sats became a thing in the crypto space, many blockchain companies joined the movement of accumulating Bitcoin.

With the growing interest in stacking sats, crypto solutions have appeared on the market, offering cashback offers and other ways for consumers to earn BTC.

Even Twitter and Square CEO Jack Dorsey – who has been widely known for his pro-crypto approach – joined the movement, posting a screenshot on Twitter in March 2019 as proof for stacking sats.

How to Stack Sats: Our 9 Favorite Ways to Accumulate Bitcoin

Now that you know everything about crypto’s new trending movement, it’s time for us to show you some handy tips and tricks that you can use to stack sats.

Let’s see them!

1. Invest a Fixed Amount Every Month (Dollar Cost Averaging)

The first option to stack stats is by separating a fixed amount of funds, and using them periodically to purchase Bitcoin (e.g., daily, weekly, monthly).

This method is based on the investing strategy of dollar-cost averaging (DCA).

Unlike lump-sum investing, where you use all your funds at once to purchase an asset, investors using the DCA method decide how much they are willing to spend and at which periods prior to the actual investment.

Let us illustrate this method with an example:

After receiving your salary and paying your monthly expenses, you decide to separate a fixed amount of funds to purchase $100 worth of BTC on the tenth day of the month.

You continue doing this in the upcoming months until you accumulate your desired amount of Bitcoin.

It’s important to mention that the DCA method goes against the strategy of timing your investments.

Therefore, if you choose to stack sats this way, then you should forget about looking at the charts before making your regular BTC purchases.

As a result, this method relieves some stress from investors as you don’t have to worry about checking the Bitcoin price before making your investment. Also, as there is no market timing involved, you won’t feel any regret if the BTC price falls after purchasing it.

2. Cut Your Coffee Expense

Enjoying a warm cup of your favorite coffee is one of the most comforting things to do every morning.

In fact, coffee is the most popular beverage in the world, with over 400 billion cups consumed every year on a global scale.

But what if we told you that many people are overspending on this fine beverage?

According to an Amerisleep study, people between 25 and 34 spend an average of $2,008 on coffee in a year, which breaks down to a monthly $167.

If you recognize yourself among the participants of the study and you are keen on stacking sats, we recommend cutting your coffee expense by a lot.

We are not saying that you should quit drinking coffee ASAP, as we don’t want to take away the world’s most beloved beverage from you.

Instead, you should consider brewing your favorite caffeinated drink at home and take it to work, rather than purchasing a fancy latte for $5 in a coffee shop.

Now, sticking to your new, cost-efficient, coffee-drinking habit, check how much funds you saved at the end of the month.

Oh, and don’t forget to use your coffee savings to stack sats!

3. Stop Killing Your Budget With Smoking

Everyone knows smoking is bad for one’s health.

However, many forget that this expensive habit could easily drain your monthly budget.

The average cost of cigarettes in the US today is $6.16, and the largest group of American smokers were consuming between 10 and 19 cigarettes a day in 2019.

If we calculate the average of ten cigarettes (half a pack), that person spends $3.08 a day on tobacco, which adds up to $92.4 in every month and $1,108 annually.

Calculating with the current Bitcoin price ($8,870), this person could use his annual smoking budget to purchase 0.125 BTC.

And what would be more convincing to give up on smoking than some shiny sats in a Bitcoin wallet?

4. Avoid Drinking (Too Much) Alcohol

While alcohol is a popular beverage when one is hanging out with his friends in their favorite pub, it is one of the top budget-killers out there.

According to Alcohol.org, the average New Yorker spends over $2,000 on alcoholic beverages in a year, which breaks down to a monthly $167.

So, if you feel like stacking sats and reducing your luxury expenses, then don’t forget to check how much you spend on alcohol each month.

Even if you don’t want to eliminate the beverage from your life, decreasing the amount you consume in each month could help you in your quest to accumulate BTC.

5. Consider Alternatives to Cable TV

Americans spend up to $100 in a month ($1,200 a year) for cable TV.

And many are paying for their cable subscriptions despite the fact that they turn on their TVs only a few times in a month.

Fortunately, online streaming alternatives – such as HBO Now, Netflix, and Hulu – come at much lower prices. Therefore, switching from cable to streaming could help you in cutting your expenses, especially when a single service is enough for you to stream your favorite shows and movies.

According to Bankrate, those who cut the cord could enjoy tremendous hours of video content for less than $50 per month.

Therefore, canceling your expensive cable TV service could allow you to accumulate at least $50 of BTC every month.

6. Stop Paying for Gym Memberships You Don’t Use

Going to the gym is a great way to lose some weight and stay in shape.

But what is the purpose of your membership if you don’t use it?

According to Glofox, 6.3% of Americans spent a total of $1.8 billion on gym memberships without using them in 2018.

As the average cost of a gym membership is $58 per month in the United States, failing to use it could lead to the unnecessary expense of nearly $700 a year.

Unless you want to start hitting the gym regularly, you can eliminate that expense to stack sats.

7. Earn Cashback on Your Crypto

Now that you have eliminated the expenses you don’t need, it’s time to see an exciting method that lets you stack crypto sats without spending a dime.

As stacking sats has become a popular movement in the crypto space, multiple blockchain projects have introduced apps and services where users could earn cashback on their purchases.

Lolli, for example, is one of the most popular Bitcoin cashback solutions. After installing the Lolli browser extension, the app will let you know when you have visited one of its partner stores where you can earn up to 30% cashback in BTC.

Fold is a very similar service to Lolli. Using its smartphone app (available on both iOS and Android) will allow you to stack sats when you make purchases on popular services, such as Amazon and Uber.

What’s more interesting is that Fold has recently partnered with Visa to launch a card that lets users earn Bitcoin back on their purchases.

Other popular crypto cashback services include:

1. Pei
2. SatsApp
3. CoinRebates
4. BitcoinRewards

8. Start Mining BTC

Mining Bitcoin is one of the oldest methods of stacking sats.

As Bitcoin uses the Proof-of-Work (PoW) consensus algorithm, miners in the BTC network are required to use their computational power to maintain the ecosystem, verify transactions, and add new blocks to the distributed ledger.

In exchange, miners earn block rewards after successfully adding a new block to the chain while getting a share of transaction fees for verifying BTC transfers.

However, as opposed to crypto cashback, mining Bitcoin requires an upfront investment from your end as you have to purchase special mining equipment – an application-specific integrated circuit (ASIC) miner – which you have to set up to be able to mine the cryptocurrency.

In addition to the setup costs, you will have to pay for the energy your miner uses as well as for cooling your rig.

Therefore, if you want to stack sats with this method, we recommend calculating your potential income and expenses to evaluate profitability prior to starting your Bitcoin mining operation.

Another method you can use to mine Bitcoin is via cloud mining services. With these solutions, you don’t have to purchase a mining rig, and you don’t have to worry about setting it up or running it as the service provider takes care of those for you.

Therefore, cloud mining is a much more convenient option for those who want to stack sats via mining BTC but don’t have the necessary resources or technical background.

On the flip side, service providers often charge hefty fees for cloud mining contracts, which could decrease your profit margin.

Furthermore, there’s a lot of scams involved in the cloud mining space. Because of this reason, we advise you to do your own due diligence and choose a reputable service if you decide to stack sats using a cloud mining solution.

Pro tip: Some altcoins use alternative algorithms to reach consensus within their blockchain networks that don’t require block validators to physically mine (or use their computational power) to validate blocks.

For example, the validators in Proof-of-Stake blockchain networks are rewarded for locking a part of their coins for a certain time to maintain the ecosystem.

If you don’t want to spend a fortune on mining equipment, you can check out these blockchain networks to stack sats.

9. Earn ASK by Leveraging Your Data and Time

Do you hate that tech giants like Google and Facebook are selling your data to advertisers who use it to bombard you with annoying ads?

We hear you.

But it doesn’t have to be this way.

Meet Permission, the cutting-edge advertising platform that rewards you in ASK coins for providing your data with your permission and for taking the time to engage with ads. Download the Permission Browser Extension and have relevant ads delivered to you wherever you surf the web, with crypto payments for every one you watch.

While you have full control over your data, you can use the ASK you earned to stack sats or shop directly via Permission’s Shop With ASK store.

And the best?

You don’t have to spend a dime to stack sats with Permission.io!

It’s Time to Stack Sats and Chill

Stacking sats is one of the best things that ever happened to crypto.

If you choose to mine or buy crypto regularly via the DCA method, you invest in supporting the decentralized economy while accumulating BTC.

Stacking sats also helps you to convert those unnecessary expenses into Bitcoin. It’s a win-win scenario as you eliminate your budget-draining habits while accumulating some shiny sats.

Furthermore, crypto cashback apps allow you to shop at your favorite stores while getting rewarded in Bitcoin.

You can even get rid of those annoying ads and choose the ones you’d like to watch as well as control the data you provide to advertisers while being rewarded in ASK on the Permission.io platform.

Aren’t you stoked to be stacking sats while engaging with businesses on the advertising platform of the future?

What are you waiting for?

Head to the official Permission website now to stack some shiny sats!

After its birth in 2009, Bitcoin ruled the cryptocurrency space as the only digital asset on the market.

But not for long.

After seeing BTC’s success, altcoins have appeared on the crypto market to introduce their own digital asset solutions.

But what are altcoins, what are their purpose, and what is the major difference between an alternative cryptocurrency and Bitcoin?

We will find out in this article!

What Are Altcoins?

Before deep-diving into our topic, let’s first define “altcoin.”

Altcoin, or alternative digital asset, is a term used to describe cryptocurrencies other than Bitcoin.

The reason for the name is pretty straightforward, as BTC is often viewed as the original cryptocurrency, while other digital assets provide alternative solutions to crypto users.

In addition to being the original cryptocurrency, Bitcoin has been dominating the digital asset industry. The BTC dominance index – the metric that measures Bitcoin’s share from the total crypto market cap – currently stands at 63.7%.

According to CoinMarketCap, there are nearly 5,400 cryptocurrencies on the market, and none of them have managed to take over Bitcoin’s leading position since the inception of the digital asset industry.

The Brief History of Altcoins

The history of Bitcoin started in 2009 when the mysterious Satoshi Nakamoto created the world’s first cryptocurrency.

But when did altcoins appear on the crypto market?

2011 marks the birth of altcoins when Namecoin (NMC) emerged as the first cryptocurrency ever created after Bitcoin.

Namecoin has an ambitious goal to replace the domain name system with a decentralized network, which allows users to register domains for a small fee, which is paid in cryptocurrency.

While Namecoin was the first digital asset after Bitcoin, its position as the second-largest cryptocurrency was soon taken by other altcoins.

One of them is Litecoin (LTC) – a cryptocurrency that is very similar to Bitcoin – that also launched in 2011.

Unlike Namecoin, LTC – which features a higher supply and transaction speed than Bitcoin – managed to stay among the top ten cryptocurrencies by market capitalization since its creation, standing at position seven at the time of writing this article.

In August 2013, Ripple (XRP) joined the ranks of cryptocurrencies, using the “OpenCoin” name at the time for its payment network.

Ripple has since partnered with numerous financial institutions and payment services – such as MoneyGram, American Express, and Santander – while featuring the world’s third-largest cryptocurrency by market cap.

Let’s jump ahead to one of the most important events in the history of altcoins: the birth of Ethereum in July 2015.

Ethereum is a decentralized platform where users can deploy smart contracts – self-executing agreements between two or more parties in the form of computer code – and run decentralized applications (DApps).

The platform also allows crypto projects to issue their own Ethereum-based altcoins via the ERC-20 token standard. As a result, the number of altcoins skyrocketed soon after Ethereum’s birth.

Furthermore, the ERC-20 standard was commonly used by many crypto projects that had launched Initial Coin Offerings (ICOs) for fundraising, allowing blockchain startups to issue their tokens and sell them to investors in exchange for major digital assets.

Since then, thousands of new altcoins have appeared on the market, providing the crypto industry with new use-cases and innovative solutions.

Altcoin vs. Bitcoin: What’s the Difference?

To see the difference between altcoins and Bitcoin, it’s important to take a deeper look at BTC first.

Bitcoin 101: The Basics

As per the original BTC whitepaper, Bitcoin operates as a peer-to-peer (P2P) electronic payment system where users can transact cryptocurrency in a decentralized way.

Since there is no central authority in the blockchain network, users can avoid censorship while taking charge of their finances.

Also, Bitcoin’s network is maintained by numerous miners from all over the world, which makes it more secure against hacker attacks than conventional systems that use central servers to operate.

Unlike the banking system, Bitcoin lacks third parties, which allows the blockchain network to feature low-cost and fast transactions.

As the maximum coin supply is capped at 21 million, investors often consider BTC as a decent store of value that has no to minimal correlation with general market assets.

Furthermore, BTC possesses one of the highest liquidity among cryptocurrencies as well as the lowest levels of volatility compared to non-stablecoin digital assets.Because of these reasons, Bitcoin is considered one of the lowest risk crypto assets for investors.

Due to the benefits mentioned above, Bitcoin has established a great reputation for itself as the world’s original cryptocurrency while featuring a decent infrastructure and a large community of active supporters.

Bitcoin’s Limitations

However, Bitcoin has some limitations, which prevent it from being used as the universal (and only) cryptocurrency in the digital asset space.

First, BTC’s use-cases are limited. Apart from sending and receiving crypto payments and holding the asset to hedge against general market risks, Bitcoin is rarely used for commercial purposes.

Also, the algorithm used to reach consensus in the Bitcoin network, Proof-of-Work (PoW), is highly energy-intensive as it requires miners to continuously operate their equipment to secure the blockchain.

While Bitcoin mining uses more energy in a year than Finland, due to the inefficiencies of the PoW consensus algorithm, the BTC network faces issues of limited scalability.

Compared to traditional payment networks like Visa and Mastercard that can process thousands of transfers per second, Bitcoin only has the capabilities to process a maximum of seven transactions per second (TPS).

As a result, there’s an increased risk of network congestion in the Bitcoin network – which often results in excessively high transaction fees and long processing times.

Altcoins to Empower Crypto With More Use-Cases

Due to Bitcoin’s limitations, altcoins have appeared on the market with the ambitious goal of empowering the crypto space with more use-cases.

To date, many successful altcoin projects have delivered value to crypto users.For example, Ethereum supercharged its blockchain platform with smart contracts and DApps to provide new functionality to cryptocurrencies.

As a result, Ethereum is one of the busiest blockchain networks, featuring nearly 900,000 transactions every day.

Due to Ethereum’s features, decentralized finance (DeFi) – a fast-growing movement in the crypto space to create decentralized alternatives to traditional finance solutions (e.g., lending, borrowing, insurance) – has become a reality.

Higher Risks but Increased Profitability

Investing in legitimate altcoins often comes with a higher potential for greater profits for investors.

However, compared to Bitcoin, altcoin investments usually bear increased risks; as such, Altcoins have much lower market capitalization than Bitcoin.

While major altcoins should be fine, the ones with lower market caps and limited liquidity could carry high risks of market manipulation (e.g., pump and dump schemes), volatility, and fraud.

Furthermore, some altcoin projects – especially a part of those that launched their token sales during the “ICO craze” of 2017-2018 – are dishonest about their goals or their products.

Unfortunately, several altcoin projects couldn’t deliver on their promises after their token sales ended. And even some of those that tried to do their best have failed to satisfy investor demands.

What Is Altcoin Mining and How Does It Differ From Bitcoin Mining?

As mentioned before, Bitcoin uses the Proof-of-Work consensus algorithm, which requires miners to leverage their computational power to maintain the BTC blockchain.

For this, they purchase special mining equipment, called application-specific integrated circuit (ASIC) miners.

However, as ASIC miners are often expensive for the ordinary Bitcoin user, some altcoins utilizing the PoW consensus model deployed alternative mining algorithms to BTC’s SHA-256 to combat the dominance of ASIC rigs.

As a result, these altcoins can be mined with lower-end mining equipment (e.g., GPUs, CPUs, smartphones) that require a smaller investment from the user’s end.

Also, many cryptocurrencies have utilized consensus algorithms alternative to Bitcoin’s Proof-of-Work to solve the energy-consumption and scaling issues of BTC’s blockchain network.

While there are still validators in the network (who are miners in BTC’s case), most of these algorithms do not require users to physically use their computational power to maintain the system. Instead, they reach consensus by other means.

For example, the Proof-of-Stake (PoS) algorithm requires validators to lock a part of their tokens for a specific time to verify transactions and add new blocks to the distributed ledger.

What Are the Pros and Cons of Altcoins?

Below, you can find a table that includes the pros and cons of altcoins.

Pros

1. Higher potential for greater ROI
2. Legitimate altcoin projects add new value and functions to cryptocurrencies
3. Many altcoins utilize more efficient consensus algorithms than Bitcoin
4. Some altcoins feature highly scalable blockchains (e.g. Permission.io)

Cons

1. Increased risks of volatility
2. Some dishonest altcoin projects are run by scammers, while others have failed to deliver on their promises
3. Altcoins with small market caps and limited liquidity face increased risks of market manipulation

What Are the Different Types of Altcoins?

Now that you know the essentials about altcoins, it’s time to see their different types.

Major Altcoins

Examples: Ethereum (ETH), Ripple (XRP), Bitcoin Cash (BCH)

This category includes those altcoins that have managed to carve out large shares of the crypto market.

Major altcoins often feature higher liquidity, lower volatility, as well as big communities of active users, and an already established infrastructure.

Due to these reasons – after Bitcoin – major altcoins are considered to pose the lowest risk to investors among cryptocurrencies.

Stablecoins

Examples: Tether (USDT), DAI, Digix Gold (DGX)

As most cryptocurrencies possess higher volatility than general market assets, many have criticized the crypto asset class for the risks digital assets pose to individuals and businesses who utilize them for everyday transactions.

To solve this issue, many crypto projects have introduced their stablecoin solutions, a cryptocurrency that has its value pegged to one or a basket of assets.

The most common stablecoins are pegged to major fiat currencies like the USD or the EUR so they can maintain low levels of volatility while taking full advantage of blockchain technology’s benefits.

Altcoins that have value pegged to other general markets (such as gold or silver) also fall in the category of stablecoins.

Utility Tokens and Coins

Examples: Status (SNT), Augur (REP), Tezos (XTZ)

Most altcoins are categorized as utility tokens.

These digital assets grant specific rights to their users. These could be anything from providing access to their platforms and services to giving discounts or special perks. The main goal of crypto projects that use tokens or coins is to incentivize users to power their ecosystems. In exchange, users can redeem the tokens or coins they gain on the crypto’s native platform or trade them on an exchange.

Utility tokens are often Ethereum-based altcoins that have been often issued with the ERC-20 standard during Initial Coin Offerings (ICOs) or Initial Exchange Offerings (IEOs).

Security Tokens

Examples: Blockchain Capital (BCAP), 22x Fund (22X)

Unlike utility tokens, security tokens grant altcoin holders a fraction of the project’s ownership.

Some crypto projects even provide security tokens to their investors that represent digital shares of the company and pay dividends to the holders.

In the latter case, the value of the digital asset is tied directly to the valuation of the company. Therefore, if the valuation of the firm grows, so will the security token.

As most security tokens – which are often distributed via Security Token Offerings (STOs) – have to comply with strict regulations, the risk of fraud is limited.

However, security tokens are quite rare among altcoins, and they haven’t reached widespread adoption within the crypto community.

Where Can You Buy Altcoins?

The easiest way to purchase altcoins is by utilizing a cryptocurrency exchange’s services.

On fiat-to-crypto exchanges, you can purchase BTC and a great share of major altcoins via bank transfers or credit cards.

On the other hand, if you want to buy altcoins with smaller market caps, you have to first exchange your fiat currency into a major crypto (preferably ETH or BTC).

Then you need to transfer your crypto to an altcoin exchange that supports the coin you want to purchase.

Below, you can see a simple step-by-step guide to make things easier for you.

Step 1: Register an Account at a Prominent Fiat-to-Crypto Exchange

The first step to buy altcoins is to register an account at a reputable crypto exchange where you can exchange fiat currency for digital assets.

Due to regulation, cryptocurrency exchanges – especially the ones that offer fiat-to-crypto trading – will ask for Know Your Customer (KYC) and Anti-Money Laundering (AML) documents.

After you have created your account at the exchange, submit the required documents to verify your identity and residence. Some services may also ask for further information, such as the source of your income.

After submitting your documents, the exchange will process and verify them, which usually takes a few days.

Step 2: Buy Crypto Using Fiat Currency

As soon as the exchange has verified your documents, you can start trading on the platform.

Before you purchase crypto, you have to first decide on the payment method you will use to fund your account.

The most convenient method to purchase crypto with fiat is by using a credit card as it usually takes a few seconds for your funds to appear in your exchange wallet.

On the flip side, buying crypto with a credit card is the most expensive method as exchange services charge a fee ranging from 3% to 5% for card transactions.

Furthermore, some crypto services use payment processors that place an additional charge (4-6%) on credit card transactions.

You can also choose to fund your exchange account via bank transfers. As there are no credit card companies or payment processors involved in the process, bank transfers are among the most cost-efficient methods to purchase crypto.

However, bank transfers could take several days to arrive, so this payment method is much slower than credit card payments.

The best way to speed up your transactions is to use a crypto exchange that supports local bank transfers (e.g., SEPA for EU countries or ACH for the US) as these usually take 1-2 working days to arrive at your account.

After selecting your preferred payment method and funding your account, head to the trading page on the exchange platform, choose your crypto-fiat currency pair (e.g., BTC/USD), set the number of coins you want to purchase and execute the transaction.

Step 3: Transfer Crypto to an Altcoin Exchange

After you have your crypto ready, the next step is to register an account and verify it at an altcoin exchange. The process should be identical or very similar to fiat-to-crypto exchanges.

When you are done, transfer your crypto from the first exchange to the altcoin exchange service.

Copy-pasting your wallet address or scanning the QR code of your wallet (when you are on mobile) is recommended when transferring your crypto.

Be sure to double and triple-check your wallet address before sending your coins to ensure that everything is correct.

After initiating the transaction, it usually takes a few minutes for altcoins to arrive while it could take up to 1-2 hours for your BTC to be credited to your exchange wallet.

Step 4: Trade Your Major Crypto to Altcoins

When your coins have been transferred to your wallet, it’s time to exchange them to your altcoin of choice.Head to the trading platform of the exchange and choose your preferred altcoin-major crypto pair.

After setting the number of coins you want to buy, execute the trade.

Don’t forget to withdraw your altcoins from the exchange to a secure wallet – where you own the private keys to your crypto wallet – to ensure the safety of your funds.

Summary

Bitcoin has established a reputation for itself as the world’s original cryptocurrency that could be used for decentralized payments and as a store of value.

On the other hand, altcoins fill the void that’s left by Bitcoin’s limitations, empowering the crypto industry with innovative use-cases.

Disclaimer: The content of this blog is for general informational purposes only and is not intended to provide specific advice or recommendations for any individual or on any investment product. It is only intended to provide education about the cryptocurrency industry. Nothing in this post constitutes investment advice or any recommendation that any cryptocurrency or investment strategy is suitable for any specific person. Do your own research thoroughly before making any investments of any kind.

You probably do not know what data you own, and you probably have no idea where most of your personal data is. If you want to know, read on—although as with most questions like this the answer is not always simple.

The Possibilities of Data Ownership

Let’s begin by discussing whether you should care about your personal data.

Right now, at the time that I’m writing this, there are only a few ways for individuals to control their data and use it productively. That’s right now, but as time marches forward, that will change.

Think of it like this:

Your personal data has value.

Skilled hackers make a handsome living from stealing and selling personal data. Credit score companies run their businesses off it. eCommerce and social media sites make billions by harvesting it to sell ads.

We at Permission.io are on the side of the angels. We enable permission.io members to earn from their data. They earn ASK coins by watching promotional videos and ads, playing games, and pursuing various other activities in exchange for allowing advertisers to use their personal profile data.

Digital IDs will make a key contribution to Web 3.0, the next generation of the Internet. They will engender a global business opportunity for people and organizations everywhere.

There are two sides to this opportunity:

1. On the one hand, cybercrime will become less and less prevalent because individuals and businesses will be able to operate in a trusted way, authenticating one another whenever they interact.
2. On the other hand, the ability of individuals to control and share their data will allow businesses and consumers to interact directly, on an equal basis, eliminating middlemen and thus reducing the cost of establishing and maintaining commercial relationships.

The Personal Data World

Given that your data clearly has value, you may be wondering what the full extent of your personal data is. Here’s a way to think about it. There are four categories of personal data:

1. Credential data. This is your identity and all the documents associated with it that act as credentials: birth certificate, social security number, passport, driving license, credit and debit cards, memberships and subscriptions, and so on.
2. Title data. This refers to data that proves ownership of something, whether it be land, a property, a car, or mobile phone. When you sell something you own you transfer its title to another owner. So this is data whose ownership can change.
3. Digital Possessions. This comprises photographs and videos you have taken and saved, plus ebooks, music, and videos you have bought. You can think of these as self-defining titles, as you could sell them if you felt inclined.
4. Your historical record. The fourth kind of data is your historical record, including such things as your educational record, your health record, your employment record, the history of everything you ever bought or sold, and even the web links that record which web pages you have visited. This data is valuable. In fact, it is your historical data, which both big tech exploits, that is responsible for their advertising income.

You probably realize that this personal data of yours is not all in one place.

Some of it is on your mobile phone, your tablet, and your PC. Some of it is held by government organizations, educational and health care organizations. Some is held by banks, insurance companies, and stores like Walmart and Target. Some is held by social network sites like Facebook and Linked In, or by e-commerce sites like Amazon. Most websites that you visit are storing some of your personal data.

Many of these organizations, particularly social networks and search engine businesses will claim that you are trading the use of your data for the services they provide, although they rarely provide any detail of what they are doing with your data.

For example, if you send a specimen of your saliva to a genetic analysis company that traces your ancestry, they won’t tell you that they may sell your data to pharmaceutical companies.

Worse than that, there are data brokers who gather your personal data from publicly available sources: court cases, marriage records, property records, etc. and combine it with other personal data they buy: browsing history, social media data, and anything else they can get their hands on, including data from retail stores and even the Department of Motor Vehicles.

The Legal Situation

You might wonder then, whether the businesses that exploit your data have a legal right to do so. Ultimately, the ownership of anything is determined by the law. When it comes to physical things, like condos, computers, or cars, the law was settled long ago and the details do not vary much, country to country.

However, the idea of data ownership is fairly new, and the legislators of the world have only taken an interest in recent years. Consequently, the situation varies, country to country and it’s far too early to think of the law as settled.

The first countries to frame data ownership laws were the countries of the EU, with the enactment of General Data Protection Regulation (GDPR). It’s likely that laws in many other countries will be based on these regulations, for two reasons:

1. The EU framed these laws to apply to businesses everywhere that have any customers who are EU citizens.
2. The fines for violating these laws can be very heavy—as high as 4% of the annual revenue of the offending business.

A consequence of this is that many large businesses outside the EU have put procedures in place for conforming with GDPR. It will thus make life easy from an implementation perspective for other countries to create similar legislation.

Because your data is fragmented and stored in many different places, at the moment, it is difficult for anyone to assemble their data all in one place. In theory, it would be possible for European citizens to do so because, by virtue of GDPR, they can demand copies of their data from organizations that hold it. However, even if someone did that there is currently no easy way for them to assemble all their personal data in a single place. This will become easier when digital IDs become more common.

Anyway, if you are wondering whether you own your personal data, if you are an EU citizen, the answer is “Yes, it’s the law”.

Elsewhere, if you live in a democratic country, the answer may be “not yet, officially”. But if EU citizens own their data, then surely you will soon enough.

Think of it this way: If you ask people to vote on whether they own their data, who would ever vote “no”?

Nevertheless, there will no doubt be some local variations in such law—and in less democratic countries, it’s impossible to predict how it will develop.

In the US, there are a variety of initiatives in favor of data ownership. It has become a political issue, but luckily both parties seem to be in favor of people owning their data. For example, Sen. John Kennedy (R-La.) introduced Social Media Data Privacy Legislation in 2019. At the same time, Democratic presidential hopeful Andrew Yang included data ownership as part of his presidential campaign.

In late 2019, California enacted the California Consumer Privacy Act (CCPA). This regulates the use of Californians’ personal data and is similar to GDPR. Other states will no doubt follow suit as time marches forward.

And if you look towards the developing world, where data ownership is rarely thought about, governments of countries large and small are rapidly issuing their citizens with Digital IDs, based on biometrics. The populations of these countries may not have accumulated much personal digital data, but with a Digital ID and a mobile phone, they possess the foundation for doing so.

Data Ownership: The Bottom Line

In summary, while we do not yet inhabit a world where people have command of their personal data, the wind is blowing very strongly in that direction.

1. The exploitation of personal data by big tech has become increasingly visible. Social media is alive with negative reactions to every excess that is reported.
2. At a governmental level, data ownership has become law in the EU and other countries including the US have started to follow suit.
3. Data ownership has become a political issue in the US, as it has become clear that personal data has value.
4. Almost all developing countries are providing biometric Digital IDs for their citizens, helping to provide the foundation for Web 3.0.
5. The blockchain provides the secure technology required for Digital IDs and data ownership.

At Permission, we are developing Digital ID capability for our members and helping them to earn from their personal data.

The outbreak of COVID-19 is creating hardship and tragedy for millions of people around the globe, and my deepest condolences are with everyone navigating such shaky waters. It’s impossible to quantify the myriad personal and business tragedies transpiring around the world, and they will inevitably affect our society as a whole long after this has passed. From our daily routines, to our relationship with work, to what we choose to do in our free time, COVID-19 has undoubtedly changed our world forever.

The digitization of our lives is about to speed up dramatically, and these changes are the result of an acceleration of trends that have existed since “the world’s first popular internet browser” was released by Mosaic in 1993. You can find evidence of these trends in retail, eCommerce, education, internet infrastructure, and perhaps most importantly, the financial system that underpins our global economy. The last generation’s disruptions will be subtext under the chapters of this newfound acceleration.

References to the retail apocalypse are already commonplace. The US has more retail square footage than any other country in the world, measuring in at 23 square feet per capita, with European meccas like the UK, France, and Switzerland under a fractional 5 feet (1). What will happen when these stores reopen?

Or take the already ubiquitous world of online shopping. In two decades, eCommerce has grown approximately 17% per year, now representing $3.46 trillion in sales. That’s 16.4.% out of a global retail market of $21 trillion dollars (2). Buying habits have been forcefully changed, and it’s easy to estimate that at a minimum, eCommerce will double its previous growth rate. The market effects of a spike this steep are enormous. Shopping malls, small storefronts, and the landlords or banks that finance them will be shaken to their core. Assuming the free market is allowed to function, we will see a transition of labor, real estate, and financing as people optimize the use of those dislocated resources.

COVID-19 has upended education as well. The online education market is growing 9% per year and is currently at $187 billion globally (3). Since the closure of school facilities, I have seen my 9-year-old daughter continue to go to class each day while at home. Her school rapidly deployed Google Classroom, and her education hasn’t suffered whatsoever. It has been remarkable to watch her class of third graders participate in video calls with their teacher and deliver their homework entirely online.

Born out of 2008’s financial crisis, early Bitcoin was trading at a mere 6 cents per BTC. 10 years later and that figure is north of $9,000 (4). Hundreds of private currencies have crashed and burned in the years since due to a lack of legitimate utility, but the survivors will grow strong and combine with BTC to create a new financial system.

This acceleration of cryptocurrency adoption and the rise of distributed ledgers, decentralized applications, and digital identity technologies will result in a fundamental restructuring of our internet and will bring transparency and monetary value to previously nebulous sectors of our internet model, most tangibly in the world of user data.

Instead of an internet dominated by a few mega-companies owning and profiting from our personal data, Web 3.0 technologies will enable an opt-in, permission-based web economy that hands data ownership back to users. This will have vast implications in how data is collected and monetized and will support the growth of cryptocurrencies that enable value exchange. The undercurrents of revolt against data exploitation and profligate money printing are growing fast and with each passing year Web 2.0 and fiat government currencies become less justifiable.

And there has never been more evidence for the financial change needed than right now: the prior $2 trillion stimulus bill, and potential second $3 trillion stimulus bill coming, engulfs the $800 billion TARP bailout of 2008 in both scope and impact. With the Federal Reserve & Central Banks around the world committed to printing unlimited money, their actions continue to make the case for a private, digital, transparent, and, ultimately, trustworthy currency even stronger. A dollar isn’t worth much when the only limit of its supply is controlled by a tiny group of central banks and politicians.

Our financial system has evolved into a crony capitalist system where the biggest corporations and institutions can borrow cheap money, use it to purchase their own stocks, give a boost to their market value, and then avoid the consequences by getting bailed out when the system inevitably falters.

Retail and media were the most disrupted by the first two decades of the internet. The next wave of societal change will be driven by blockchain, cryptocurrency, and decentralized finance, which will disrupt our anachronistic financial system that relies on central banking and upgrade our internet to a more transparent, permission-based system — ultimately improving the lives of the 7 billion people who live on this planet.

—Charles Silver, CEOPermission.io

The world of marketing intelligence is changing.

The problems of data privacy and security have become such mainstream speak and such a mish-mash of concepts and proposed solutions that the facts themselves often become muddied.

It’s made worse as the technology seeking to solve these problems evolves at a breakneck pace, leaving few who truly manage to keep up with and understand the depth and implications of the growing field.

Today, we’re going to set the record straight and give you, the consumer, an in-depth look at the real issues and solutions to the “data rights” problem.

Privacy; everyone wants it.

It’s jargon in today’s technology dictionary that’s been stripped of its definition by anyone wanting to throw another buzzword into their value prop. While it’s certainly laudable that companies are concerned with protecting your data from prying eyes, the reality is that very little of your data is truly private in the Information Era of today.

Your phone apps log your location. Your ISP looks at what sites you visit. Your mortgage reveals your income and details about your financial life. Your electrical company measures how long you stay up at night. All of these factors create a data profile that companies use to track and target you, the consumer.

The first solution that many call for is further regulation. What most people don’t realize is that the government is interested in that profile of yours as well.

Certainly, the regulatory bodies will make a show of bringing Facebook and Google to answer for gathering data on you, but it isn’t going to deter what is arguably the most profitable model of their business because all of that data is actually really, really valuable to the government as well.

Look no further than reports from outlets like the New York Times, revealing how a single program associates you with every single photo you’ve ever been in across all of social media. With police using the program to scan every face on camera for suspected criminals, we’re already seeing the lines of privacy and safety blurred.

That’s right. This technology is already on the streets, powered by social media to identify and track citizens, even if they haven’t committed a crime.

And if you think the government is going to step in and regulate, realize that this AI-powered application is already used by over 600 law enforcement agencies. It’s a floodgate that’s been opened by individuals not aware of the full implications of what they offered and, sadly, your personal information becomes their bargaining chip.

Remember the saying:

If something is free, you’re the product.

It’s not just Facebook, Google, or various other applications you may use in your day-to-day activities. The growing trend of ‘unplugging’ from these services doesn’t change that DMVs, Power Companies, Map Services, ISPs, and countless others are all collecting these data points to bundle up and sell.

Fighting this, while functioning through normal everyday tasks, is almost completely futile given the sheer number of companies that are collecting information on you.

Instead, the conversation is shifting. Instead of companies profiting solely from the data you provide, consumers are calling for their fair share.

This is the core concept of data ownership.

If you are the owner of your data, then it is only right that you be compensated for the collection, sale, and/or transfer of that data.

Fighting this, while functioning through normal everyday tasks, is almost completely futile given the sheer number of companies that are collecting information on you.

Instead, the conversation is shifting. Instead of companies profiting solely from the data you provide, consumers are calling for their fair share.

Currently, it’s not so straightforward how consumers can take back ownership, or furthermore, be paid for, their data on an individual basis. But, that is changing. Blockchain technology is ushering in a new era and a new frontier for advertising that puts individuals back in control. Permission is trailblazing this new frontier with its blockchain and cryptocurrency (ASK).

Permission.io can be thought of as an “agent” for your time and data. Its platform makes it easy for you to own, control, and profit from your information by rewarding you for the revocable data you choose to share while engaging with the web as you normally do. From building your profile to being entertained to completing a successful shopping experience, the ASK cryptocurrency powers a trusted and fair transaction between you and the advertiser.

It’s through the advances of cryptocurrency and the increasing expectations of consumers to receive value in exchange for their data that the ASK ecosystem flourishes. Permission is building a future where you control who has permission to advertise to you and are compensated for the value you bring to that relationship.

Learn more about the ASK ecosystem and the platform Permission.io is building for the future by clicking here.

Permission announced today that it has signed an advisory agreement with RockTree LEX to provide strategic support as part of the company’s aggressive growth plans into Asia as they lead a new category of digital advertising called “Opt-in Value Exchange.”

301 – https://www.marketwatch.com/press-release/advertising-industry-being-disrupted-by-ask-permission-first-ad-blockchain-2020-02-21

The new batch of crypto assets brings the total number of projects listed on the registry to 54. It launched with 12 projects in November 2018.

301 – https://www.coindesk.com/messari-disclosures-registry-tops-50-cryptocurrencies-with-10-new-additions

A Permissioned World

Great endeavors throughout history, whether revolutions or businesses, can track their success based on their appeal to what is right. There is no doubt that the mass adoption of the world wide web and the explosion of opportunity that came with it inspired high hopes for a better world.

Sadly, many of the great enterprises of the dot-com era have abandoned that ideal and their moral compass. Once rooted in the freedom of information and ideas, their business models are now based on interruption, surveillance, data exploitation, fake bot activity, and a bewildering lack of transparency.

The public revelation of these behaviors has fostered an environment of mistrust in the very companies that most need to inspire honesty and loyalty.

In particular, internet advertising giants have honed their “free” products to take from you what can never be returned. They not only interrupt you and exploit your personal data but also seek to hijack your most precious resource: time.

IT IS TIME TO CHANGE THE MODEL.

Advertisers are as disappointed as you with the lack of trust on the major digital platforms. So we have created a Permission; an advertising environment where real users choose how to spend their time online and are valued and compensated.

At Permission, you own your data and your time, and you grant permission if you wish to share them. At Permission you receive value in exchange for granting that permission.

When advertisers know their potential audience actively chooses to watch their advertisements, they will abandon the attention-getting tactics that are part and parcel of the world of interruption marketing and begin to be a helpful part of users’ internet experience.

In the Permission Marketplace, we expect ads to be anticipated, personal, and relevant.

When the audience is rewarded for its time, advertising ceases to be adversarial. It becomes the first step in an effective and mutually beneficial relationship-building process. Permission facilitates transactions between those who want to engage.

The Permission Marketplace introduces both validated advertiser value and a consumer-friendly introduction to cryptocurrency. It is facilitated by the Permission token, a cryptocurrency that enables advertisers to pay Permission members directly and records its transactions on a dedicated blockchain.

PERMISSION IS TRANSPARENT, OPEN, AND SCALABLE. IN SHORT, IT CAN BE TRUSTED.

Our Mission

Our mission is to bring trust and transparency to a market that is craving it. We believe that building a bridge between advertisers and viewers is ethical and rational. Anyone who wishes to join us will swap the frustration of interruption for the right to earn from their data and their time.

We intend to make the world a better place. Join us on this journey.

By the end of WWII, the German economy was wrecked. Germany was split into four zones under the military rule of the Americans, British, French, and Russians. Hitler’s Reichsmark was still in circulation but had been rendered almost worthless by massive inflation in the latter stages of the war.

Because Reichsmark notes bore the swastika, the Western administration withdrew them from circulation, replacing them with Allied Occupation Marks, printed in the US.

Getting this temporary new currency to circulate was not easy — so difficult in fact that a barter economy soon evolved with cigarettes as the currency.

This unusual situation happened almost naturally. In Germany smokers’ ration cards had been issued from 1940 onwards, limiting smokers to a mere 40 cigarettes per month. Since most smokers have a more substantial appetite than that, a black-market for cigarettes soon flourished.

When the war ended, cigarettes were the most effective currency because they were already circulating, the supply was limited, and they were regularly burned — damping down inflation.

In June 1948, the Deutsche Mark was launched, with an airdrop of 40 DM to every resident of West Germany. At last, there was a reliable currency in circulation and it forced the black market into swift retreat.

While cigarettes could never be a sustainable currency, it worked surprisingly well for a few years among a population of over 30 million.

What Makes a Currency Viable?

By definition a currency is a medium of exchange — it must be exchangeable for goods. Until the dawn of the digital world, this severely limited what could serve as a currency.

It couldn’t be something that decayed easily, or could be forged easily, or was too large or too heavy and, above and beyond those practical details, people who used it needed to have faith in it. These conditions reduce the possibilities of what can serve as a currency considerably.

Historically, until the invention of printing, there are few examples of money that was not coins of one kind or another, made from iron, bronze, silver, or gold. The invention of the coin is lost in history as also, surprisingly is the invention of the account. There is evidence from 30,000 years ago of the use of tally sticks, as a primitive form of accounting.

You can think in terms of “exchange money” (coins for buying things) and “account money”, which is a store of value managed by some organization you trust.

In ancient Egypt, Babylon, India, and China, temples and palaces often included commodity warehouses that issued “certificates of deposit” as a claim on goods stored there.

Also, there is the idea of legal tender. A currency is a legal tender if, by law, you cannot refuse it as payment. Such currency is, of course, only legal within a given jurisdiction.

Finally, a currency needs to have a relatively stable value so that it can act as a store of value and a metric of value. Currencies that fluctuate in value fail because they are not reliable either as a store or a metric of value.

To summarize, ideally, a currency has the following characteristics:

1. It can be exchanged for goods or services, as the medium of exchange.
2. It can be used as a currency of account (if an appropriate mechanism exists).
3. It is proof against fraud.
4. It is highly portable.
5. It is legal tender.
6. It is a store and metric of value.

De Facto Currency

In the 16th century, the circulation of gold and silver coinage constituted a near-global currency. It was in use across the Eurasian landmass from Scandinavia to Korea.

It was viable because the coins were valuable of themselves. There was minimal coin value inflation, the coins could be tested for fraud, and they didn’t need government validation. The coins were portable (within reason) and on the trading routes, secure banks existed where large holdings could be deposited.

Consequently, merchants had faith in such coinage, and it was used extensively — and for many years, even after paper currency was introduced.

At various points in history, currencies have emerged and survived without the need for government imposition. And it looks like it may be happening again.

Cryptocurrencies may evolve into de facto currencies, and there may be nothing governments can do to prevent it, short of martial law.

Let’s consider it point by point:

1. Are cryptocurrencies an effective medium of exchange?

Demonstrably so. A number of them: Ether, Litecoin, Bitcoin Cash, Monero, and others are used as money, by a growing band of consumers and retailers (mostly eRetailers).

Their value can be readily known 24/7 by reference to crypto markets. In fact, they have a distinct advantage in this as the cost of exchange is very low.

Faith in these currencies as a medium of exchange is established.

2. Can they also be a currency of account?

In reality that is their strength. The crypto wallet and its contents are one.

As such, a crypto wallet is a bank account, a debit card, and currency all rolled into one.

They are a currency of account that requires no trusted third party to manage the account.

3. Are cryptocurrencies proof against fraud?

The record cries “YES”, and so does the mathematics that spawned them.

As far as anyone knows, they are impossible to forge. As with any other currency, it can be stolen.

But crypto is by no means as easy to steal as banknotes, which belong to whoever holds them.

4. Is cryptocurrency portable?

Yes — highly portable, more so that gold or silver. They are as portable as, say, a mobile phone or a banknote. If not more so.

5. Is cryptocurrency legal tender?

Not in the sense that people are obliged to accept it in payment. However, because of the existence of various fast exchange capabilities and crypto debit cards, it is as good as legal tender as you can easily exchange it for legal tender.

6. Can cryptocurrencies be used as a store and metric of value?

This is where, at the moment, many cryptocurrencies fail. Their value (as expressed in local currency) fluctuates far too wildly. They will not become practical currencies until such fluctuations tamp down.

We Have Thought Long and Hard About This Problem

At Permission, we looked at it this way: Most of the popular cryptocurrencies are alternatives to fiat currencies — they provide payment mechanisms.

Our currency, the Permission token (ticker: ASK), is a utility token. As such it is more like air miles or other such loyalty tokens, which derive their value from the commercial ecosystem in which they circulate.

So our currency may be different.

Time will tell.

In my last blog post, I discussed the value of personal data. I’ll return to that topic in a week or two’s time. Here, I’ll take a detailed look at the boundless and diverse world of advertising.

The Advertising Explosion

In 2006, Jay Walker-Smith, President of the marketing firm, Yankelovich, claimed that the average American was exposed to 5,000 ads per day, ten times as many as in the 1970s. According to Red Crow Marketing Inc., the current figure is somewhere in the range of 4,000 – 10,000.

At first glance, those figures seem to be a wild overestimate. But wait a minute, you were just exposed to two ads in the above paragraph and you probably never noticed. They were brand placement ads born of my need to declare my data sources.

Most of the ads you encounter in your typical day are of that ilk. Consider supermarkets’ shelves, for example. Supermarkets carry up to 46,000 products (according to the Food Marketing Institute) as a stroll through the supermarket is probably good for more than 1,000 brand exposures.

Let’s do some math. If we assume 4,000 ad exposures per day and a 16 hour day, then on average we will be exposed to an ad every 15 seconds. So half an hour in the supermarket could get you more than a quarter of your ad exposures for the day.

The Full Gamut of Ad Channels

Gotta catch ’em all:

1. TV. The TV is ubiquitous: at home, in the restaurant or bar, at the airport, on the airplane, and sometimes, even in the back of a cab. Cable TV broadcasts ads roughly 25% of the time, with a batting average of 48 ads per hour (according to MediaPost). To that, you can add the product placements in TV shows, or if you are watching sports, the virtual ads that overlay the TV images.
2. Radio. Expect to experience 20 ads an hour.
3. Billboards. There are somewhere between a half a million and three-quarters of a million billboards distributed out across America — although there’s none in Alaska, Hawaii, Maine, and Vermont, where the law has banished them.
4. Retail. Almost every shop window is an ad of a kind, and signage abounds. You can also throw display ads onto this category — in bars, at bus stops, at train stations, in buses, on trains, or in the metro.
5. At the cinema. The time the cinema says the movie starts is the time the 15–20 minutes of movie ads start, exposing you to about 70 annoying ads that are immune to a fast-forward button — and also movie trailers you might enjoy.
6. In the mail. About 48% of US mail is junk mail according to the USPS, giving an average of 848 pieces per household per annum, or 2.32 per day. Some of that junk mail is, of course, catalogs awash with ads.
7. Newspapers and magazines. You expect to see ads (and inserts) in newspapers and magazines. It’s been that way since Pontius was a Pilate, whether it’s American Angler or The New York Times. You’ll even find ads in Spiderman comics.
8. On PCs and laptops. With PCs, the main source of ads is email (and almost every other messaging app). Unsolicited junk email is roughly 90% of the total, although email filters can be more than 99% efficient so it’s not hard to keep under control. Of course, the web is awash with ads, display ads, pop-ups, ads on videos, and so on. Google estimates that roughly two-thirds of people’s searches are for products or services. Those are self-solicited although the rest are probably unwelcome. The use of ad blockers is prevalent and growing. It is currently estimated at about 40% of US PC users. One ad-blocking business, Bad Ad Johnny, estimates that the average internet user encounters 11,250 ads per month or 375 per day. About a third of those are likely to be encountered on social media.
9. On mobile devices. Smartphones furnish you the same collection of ads as the PC when you surf the web, but they also include apps with ads (pay for the app or we’ll plague you with ads), apps that are ads, and ads that know your location. They also enable spam telephone calls, as do landlines.
10. In video games. There are product placement ads in video games — of course, there are.
11. And everything else. So far, I’ve failed to mention planes towing ads through the sky, vehicles painted with adverts, wearable technology, ads on faxes (yes, they still exist), brands on your clothes and digital devices, messages on T-shirts, advertorial writing, and last but not least, shills and bots in chat rooms.

Did I miss anything?

Yes, I did. My bad. I failed to mention tattoo ads — renting out your skin — which was a thing about 10 years ago. The most successful walking talking billboards earned $220,000 or more, but sadly there was a scarcity of volunteer skin.

A Disturbance in the Force

There is a battle for human attention. Attention is a finite resource and advertisers can only capture so much of it. Red Crow Marketing Inc. estimates that the average person will only notice about 100 ads a day. If we experience 4,000 ads per day and absorb just 100, clearly 97.5% are wasted.

But 100 per day is not the figure we should be interested in. The figure that should interest us is the number of times per day that we seek the information an ad can provide, which is far lower.

Very few of the advertising channels listed above are permission-based — in the sense that you opt-in to receive the ads, rather than get interrupted by them. And that’s where the problem lies — and partly why we at Permission are pursuing a permission-based business model. The more aggressive the ads become, the more effort people expend in blocking them.

They throw junk mail away without opening it, tune out the radio ads, install email filters and ad blockers, record TV programs to fast forward past the ads, and so on.

There is something very wrong with this.

Effective permission-based networks like QVC on TV, Craigslist or Yelp on the web, or Groupon on mobile phones can and do exist — and they prosper. Permission-based ads work. And it should not be surprising.

Advertising is a natural aspect of consumption. Shoppers like to window shop, consumers like choice, and advertising opens up a door to the possibilities. We shouldn’t feel the urge to slam that door shut.

With the passage of GDPR, it has become an unstoppable force that is reshaping the ways that companies do business and how they interact with their customers. Yet in spite of its landmark importance, there is still confusion as to what exactly the consequences are for ordinary people.

So, let’s examine what your individual data rights are under GDPR.

You can summarize them with these words:

1. The right of consent
2. The right to access the data
3. The right to change data
4. The right to complain
5. The right to erasure
6. The right to portability

I’ll pick them off one by one, but remember that it is not a fine-detail description of the legal niceties — if you want that, follow the links. This article just explains each.

Individual Data Rights Under GDPR

1. The Right of Consent

Under GDPR, organizations cannot store an EU citizen’s data unless they give their unambiguous consent. There are some exclusions (see the Right to Erasure, later in this article). The precise words used in the regulations are: “freely given, specific, informed and unambiguous”.

Consent is not given if the organization requesting the data does not ask for it, or displays pre-ticked boxes that indicate consent. Those who haven’t explicitly opted in opt-in, have opted out. No matter what data they provided, the organization has no right to store it.

To make matters more awkward, consent must be given for each process applied to the data. So perhaps XZY Company stored my data so it could process my orders. That’s fine, but it cannot aggregate that data with other people’s data and start analyzing it unless I also agree to that. So it behooves companies to get all the permissions all at once.

GDPR also restricts the automated processing of personal data to analyze or predict an individual’s behavior. Specifically, the regulations restrict this activity if it will have a significant impact on an individual, such as in a hiring or credit decision. Many companies will have to adjust their business models around such restrictions.

And if you are hoping there’s a loophole for data already stored, there isn’t. If you never got permission, you now have to get it, both for storing the data and processing it.

Read More: Art. 7 GDPR

2. The Right to Access the Data

This is more complex and far-reaching than the word “access” implies.

First of all, the EU citizen has the right to ask whether an organization is holding and processing his or her data, whether they have had any interaction with them or not. Having discovered that this is the case, they have the same rights as if they had volunteered the information. They then have the following rights, as well as all the other rights described in this article:

1. Ability to access the data.
2. To know what data is held, and where it came from.
3. To know the purposes of the processing done on it.
4. To whom the data has been disclosed, including recipients in other countries or international organizations. If that is done, all the data rights have to be enforceable at the destination (see Art. 46 GDPR).
5. The time period the data will be stored, or if impossible to state precisely, the criteria used to determine that period.

Beyond that, individuals have the right to know of the existence of automated decision-making on their data, including profiling, and “meaningful information about the logic involved”, as well as the significance and the consequences of such processing for the data subject.

Or, to put it simply, if you are analyzing their data, you have to tell them exactly how and what the consequences will be for them.

Read More: Art. 15 GDPR

3. The Right to Change Data

The right to change data enables the individual to request that data, if incorrect, be corrected.

Additionally, companies will have to notify them of everyone to whom their data has been disclosed so they can get that copy of the data updated. Failure to comply with their request requires a company to explain the reason for not doing so, and it has an obligation to inform the user of their right to complain.

This could, of course, become complicated. The problem is dirty data. Nowadays, there is a considerable amount of dirty data, for a variety of reasons, including data entry errors by the data owner.

The problem is that incorrect data may have negative consequences for the data owner, for example, if it is part of a credit report.

Read More: Art. 16 GDPR

4. The Right to Complain

So, to whom will they complain? Individuals have the right to complain to a supervisory authority; there is at least one such authority in every EU country.

The situation will thus be a little difficult if your company hasn’t yet registered with an authority. The authority will provide guidance on what needs to happen. Their word will probably be final.

Read More: Art. 16 GDPR

5. The Right to Portability

Individuals have the right to request all personal data about them from an organization company holding their data. This must be transferred to them in a “machine-readable” format — so a CSV file will do.

For the EU citizen, this could be very useful if they wish to build a database of personal information. Just get all of it from every company or government department you gave it to. Nice!

Read More: Art. 20 GDPR

6. The Right to Erasure

The “right to erasure” has also been referred to as the “right to be forgotten”. This means that EU citizens can request the complete deletion of their data. The data must be deleted without “undue delay”.

So, my advice to EU citizens: If you want the data deleted, first go and collect it and put it into a personal database, then request deletion. However, there are exceptions you need to know about. You will not be able to get data deleted in the following situations:

1. Legal compliance. For example, banks in most jurisdictions are obliged to keep data for seven years, so your personal data will not be erased. Also, if you have a criminal record, don’t expect to get that expunged.
2. A “public interest”. For example in the area of public health, data archiving in respect of scientific, historical research or public interest or data supporting legal claims.
3. Paper data and microfiche data. GDPR only applies to digital information. Neither does it apply to technically impossible situations, such as when your data is held in a back-up file, but in that circumstance, no processing of your data is allowed. If it is restored, it must be deleted.

If a company makes your data public, and you wish “to be forgotten”, it is obligated to take reasonable steps to get other processors to erase the data. For example, when a website publishes an untrue story about an individual and later is required to erase it, it must request other websites that have republished the story to erase their copy of the story.

Of course, this only applies when it doesn’t conflict with freedom of expression laws. In short, you can’t suppress legitimate press.

Read More: Art. 17 GDPR

But What About the US?

US companies that are affected by GDPR are advised to consult with their insurance brokers to determine the impact of the regulations on their insurance programs. They need to discuss the coverage of GDPR violations and the logistics of insurance policies to pay into GDPR-regulated countries.

Yet for all of these data rights, they only apply to citizens of EU countries. So where does this leave the state of data privacy for US citizens?

On April 10th, Mark-have-I-said-I’m-sorry-enough-yet-Zuckerburg was facing a Senate Committee, pretending to sound responsible and issuing the occasional “mea culpa”. The senators, as one would expect, didn’t understand the technology side and spent most of their time trying to say something memorable.

Kudos went to Lindsey Graham (R-SC) for mentioning the word “monopoly”. This word strikes fear into the hearts of big company executives, and can make a social network CEO melt like that Nazi villain in Raiders Of The Lost Ark. But it didn’t.

Regulations Imminent!

Nevertheless: Personal data abused, elections interfered with, citizens outraged — no doubt we’ll soon see a convoy of regulations coming down the pike.

Politicians are filling the air with sound-bites that suggest imminent action and express noble goals (along party lines of course). One might get the impression that sometime soon, no single piece of personal data will ever be bruised or abused again. Dream on.

For one thing, the Facebook business model depends entirely on exploiting personal data, and no politician wants to be responsible for downing America’s sixth-largest company. So expect a poorly formulated “Privacy Bill of Rights” or “Bill of Privacy Rights” to emerge.

Subsequently, lobbyists will circle like vultures over roadkill until the traffic dies away, so they can dip their beaks into the impending legislation to “enhance” it. They will prevent any of the companies they represent (Facebook, Google, Twitter, et al) from losing a dime of revenue, and with a fair wind, they may actually turn it into a revenue opportunity.

That’s how it might have happened if the EU hadn’t ruined the game. Unfortunately for our beloved data pirates, the EU has set the bar for privacy legislation and it’s not a low one. American politicians may feel the urge to compete — but sadly they’re unfit.

Can America Beat the EU?

There’s a scant possibility that the US legislative system will get even halfway to where Europe is. They don’t have the players. The US legislative team has been performing abysmally of late — they haven’t won a trophy since the LA Dodgers last won the World Series.

But perhaps it doesn’t matter. Promising new teams are emerging from the newly formed crypto economy, and they may do the job on America’s behalf. They may even go further.

Crypto businesses that preside over personal data tend to give a damn about privacy. As new businesses that are de-facto-international, they’d be stupid to flout GDPR, so they don’t.

Some, like Permission, are going further than GDPR. Rather than explain the technology employed (it’s complicated), let me frame it in the terms I’ve used above to describe the EU’s personal data rights program.

We would like to enhance those handsome regulations in the following way:

1. The right to personal cryptographic control. You have the right to personal cryptographic control (by private key) of ALL your personal data and the right to provide permission for its usage at the item level.
2. The right to anonymity. You have the right to have your data anonymized when requested by others so that it does not include any personal data that identifies who you are (this may seem impossible to implement, but it isn’t because of the next right).
3. The right to zero-knowledge proof. You have the right to employ zero-knowledge proofs to provide credentials to preserve your anonymity.

Sound like a movement you could get behind? Join us at Permission.

The Story of Inflation and Hyperinflation

People don’t think much about currency; they just use it. They don’t notice a currency holding its value; they only notice when it doesn’t. Historically, the most frequent cause of a currency losing its value is: governments printing money.

To illustrate the effect, let’s consider a very simple example. There are 100 pencils for sale, and there is a demand for exactly 100 pencils. If there is $100 available to buy the pencils, the price will tend towards $1 per pencil. Increase the supply of dollars to $200, and the price moves towards $2. The supply of pencils and the demand for them did not change, but the supply of money did, and it pushed up the price.

In a big America-size economy with millions of people and millions of things to buy, the same thing happens. If the economy remains the same, but you increase the supply of money, the prices rise — which means that the value of the dollar falls.

If the change in value becomes noticeable, people will spend the dollars as fast as they can, because the value of the dollar is falling. If they don’t need to buy with their dollars, they will buy something that will keep its value (gold, silver, or whatever). The currency has become “debased”.

Such inflation occurs when a government prints money like it’s going out of style, and naturally, it does go out of style.

How Does the Fed Print Money?

In truth, it doesn’t print anything. You may picture the Federal Reserve commanding printing presses to spew out vast numbers of pristine 100 dollar bills. But that isn’t the mechanism “for money printing”. Paper dollars account for only about one-tenth of the dollar money supply.

The full dollar money supply includes sources of money that are rarely converted into dollar bills but could be: money in checking accounts, savings accounts, money orders, 24-hour money market funds, certificates of deposit, and so on.

When the Fed prints money, it does so by extending credit to (i.e., loaning money to) the banks and managing the interest rate they have to pay. The banks can then, if they so choose, lend that money to people or businesses and it will find its way into those various sources of money. That’s how the game is played.

Does This Mean the Fed Can Print as Much Money as It Pleases?

Not really. If you listen to the financial news once in a while, you’ll hear reports about the regular monthly meeting held by the Fed, what the Fed chose to do, and how the financial markets reacted.

If the Fed starts printing money in a big way, the markets will react negatively. The Fed prefers not to roil the markets unless it has no choice. If theFed wants to mess with the money supply it has to explain itself.

If the Fed Lends Money to the Banks, Do the Banks Have to Lend It Out?

No. In fact, they don’t have to accept the money at all. But lending is how banks make money. Typically, banks lend out more than they borrow from the Fed. They could lend out, say, ten times what they borrowed. This is called “fractional reserve banking.”

If the banks make good lending decisions and the borrowers payback, then everything is hunky-dory. Problems arise when banks make too many bad loans. That’s when banking collapses occur. That’s why banks are regulated.

So How Does That Compare to Cryptocurrencies?

Cryptocurrencies are not like that at all. Not even close.

With a cryptocurrency, there is no Fed. And there is no fractional reserve banking. Software controls the money supply and people never have a say in it.

With Bitcoin, for example, the money supply grows gradually — currently at about 3.85% per annum. It is slowing down. It will eventually come to a stop when 21,000,000 Bitcoin have been created.

The supply grows because (and only because) Bitcoin miners are paid in Bitcoin for mining blocks. The increase in the supply of Bitcoin is the payments made to miners.

Miners are also paid the transaction fees from each block. Eventually, when all the 21,000,000 Bitcoin have been created, the Bitcoin miners will make a living from transaction fees alone.

Other Cryptos

Different cryptos have different money supply growth rates. Most (like Litecoin and Ethereum) imitate Bitcoin and have a declining growth rate. Others, like Permission (ticker: ASK) and XRP (Ripple), have zero growth rates.

In each case, the blockchain ensures either that no new crypto can be created or enforces the rate at which the new crypto is created. The only currency in existence there is the cryptocurrency recorded on the blockchain.

Is It Possible to Have “Fractional-Reserve Banking” With a Cryptocurrency?

No. This needs to be well understood, because — aside from the automated nature of the crypto money supply — it is the critical difference between fiat currency and crypto.

With fractional-reserve banking, a bank borrows, say $1 million from the Fed. It then loans out, say, $10 million. $9 million are thus “created from nowhere”. Yes they are recorded in bank accounts, and they circulate around, and eventually, most of those dollars are paid back. So they exist, “sort of”.

But do you know what happens if the borrower cannot pay the bank back and instead goes bankrupt?

Those dollars disappear. They vanish as if they never existed.

That’s what happens in a banking crash. Too many loans go bad, and the bank itself goes bankrupt — unless the Fed lends it some money to stay afloat.

None of that can happen with a cryptocurrency, because the amount of currency created is always there on the blockchain. It may pass from one owner to another, but it is always right there.

Would It Be Different if the Dollar Was Backed by Gold?

The dollar was backed by Gold once. And so were other currencies. The Gold standard was first abandoned when the First World War broke out. The countries involved in the war could not afford the war, so they printed money to pay for it.

If your currency is backed by gold, it is exchangeable for gold. If you print money like a drunken sailor, people buy gold with it, your gold reserves are quickly exhausted and the currency collapses. So if you back a currency with gold, you just cannot afford to print money. With crypto it’s quite similar, you simply can’t print money.

Fiat and Crypto Are Staggeringly Different

People earn money, buy stuff with it, and squirrel it away under a mattress but understand very little about its nature. We hope to change that though, so provided below is a stepwise introduction to both money and cryptocurrency.

A Mild Dose of History

The alternative to money is barter, and when money fails — as it does in situations of hyperinflation (caused by moronic politicians believing you can print mountains of money without consequences) — barter takes over.

Then people have to find ways of swapping goods and services with each other and it’s complicated. The problem is that without money there is no unit of measure for value. You know this already.

You have an inner psychic mechanism that assigns value to things based on the currency you are familiar with: Dollars in the US, Balboas in Panama, Quetzals in Guatemala, and Dongs in Vietnam.

Cryptocurrency Exchange

Try changing countries. If you’ve ever done that, you’ll know it’s hard to adjust your sense of value because costs are different, taxation varies, trade barriers exist and different (cultural) values predominate.

Small tribal communities of hunter-gatherers can survive without money by sharing everything according to some established order, but this doesn’t scale well. Even in tribal societies that use barter, usually a “unit of value” emerges. This happens so naturally that some academics claim there are no pure barter economies.

The Measure of Value

The prime function of a currency, then, aside from payment is to provide a stable unit of value. Effective currencies are difficult to invent because people cheat. A good currency needs to be cheat-proof.

Many things have been tried as currencies, including:

1. Food (Salt, from which comes the word “salary”. Also cocoa beans, turmeric spice wrapped in coconut fibers. And incidentally, Parmigiano Reggiano and Parma Ham are still used as collateral at some Italian banks)
2. Cowries (she hoards seashells by the seashore)
3. Cigarettes
4. Coins — bronze, silver, and gold
5. Hard to forge paper portraits of presidents with numbers on them
6. Electronic records attached to a blockchain, using cryptography

And Now Something Different: What Is a Reserve Currency?

I do think some digital currency will end up being reserve currency of the world. I see a path where that’s going to happen.

I agree with Brain Armstrong (CEO of Coinbase) that a cryptocurrency will eventually become the world’s reserve currency. To think about what that means you need to know what a reserve currency is.

A reserve currency (sometimes called an anchor currency) is a currency is used in international transactions and hence a currency that is “global.”

There needs to be a unit of value to price internationally traded commodities (oil, copper, tin, wheat, cocoa, etc.). Right now, the US dollar is that unit.

The only other significant reserve currencies are the Euro, the Japanese Yen, and the British Pound. The dollar dominates (estimates suggest 62% of foreign reserves held in dollars, 20% held in Euros, with the Pound and the Yen at about 5%).

The human need to price things ensures that one reserve currency dominates. At the moment, it is the US Dollar. Before that, it was the Pound

Is There an Advantage to Being a Reserve Currency?

For a country, yes. Right now all nations (and most international businesses) hold copious quantities of dollars. The US gets to print them and other countries have to buy them. This enables the US to run a much bigger balance of payments deficit than any other country. A persistent balance of payments deficit in other countries soon impacts the value of their currency.

Since the end of WWII, the US has leveraged this to boost the US standard of living. The downside is that the US has built up substantial debt. In 1985, it ceased being a net creditor nation and became a net debtor nation — and the debt grew like bamboo in spring.

Everyone else was helping to finance the US standard of living.

Will it end badly?

Yes, it will, at some point. When those US dollars get homesick and fly back to the US, they will inflate the stateside supply of US dollars, which will, in turn, drive up prices. The natives will surely become restless.

What Is the Money Supply?

If you ask this question of most cryptocurrencies you get the same answer. The supply of the currency is determined by an algorithm. With some cryptocurrencies — the Permission Token and Ripple are examples — the money supply is fixed from the get-go. When that’s the case, the currency is said to be “pre-mined”.

So for crypto, either an algorithm determines the growth of the money supply, or it is fixed at birth. This is not the case with National currencies or “fiat currencies” as they are often called.

In case you didn’t know “fiat” is Latin for “let there be”. According to the Old Testament, the first recorded words of God were “fiat lux” (let there be light). The label “fiat money” is not a sarcastic term that emerged from the crypto community, but an Americanism dating back to circa 1870–75 pointing out that paper money has no intrinsic value.

This is the defining difference between cryptocurrencies and all other currencies. The money supply of a cryptocurrency is fixed and immutable. With all other currencies, including gold, the money supply is not fixed and immutable.

Some people have a deep faith in gold as a currency because the supply and its destruction (through loss and industrial use) are roughly the same and have been for a few centuries.

However, when the Spanish filched the Aztec and Inca gold, the supply of gold in Spain grew dramatically. There was gold-provoked inflation.

If new highly productive gold deposits were discovered at the bottom of the ocean or on a mineable asteroid or wherever it could happen again.

With crypto, the money supply is publicly displayed on a bullet-proof blockchain. It cannot be manipulated. The crypto money supply is thus easy to understand. With fiat currency, it is not, as we shall see.

What Are Notes and Coins?

When we speak of the fiat money supply there are four species; usually labeled M0, M1, M2, and M3. They live inside each other like Russian dolls.

The first of these, MO, is the easiest to understand; it is the coins and notes in circulation. This is what most people think of as money because you can touch and see it.

Most fiat money of this species. In the US such money accounts for about 8.3% of the dollars in circulation. It’s the same for most other currencies.

Curiously there is no equivalent of this kind of money with a cryptocurrency. This kind of money is “bearer money”. If you carry it, you own it. Nothing about notes or coins enable you to prove ownership.

Cryptocurrency is always held in a wallet and belongs to the wallet owner. Muggers cannot steal it from you.

Of course, hackers can steal it from you and fraudsters may find ingenious ways to lay their hands on it, but in either case, it will be because you took insufficient care of it — you allowed it to be vulnerable.

Paper notes and coins can be lost or destroyed. And that too is the product of carelessness.

Ragged, Worn, and Torn Notes

Paper notes wear out, provoking the mint to renew them with pristine replacements. To make money, you have to spend money. The perpetual printing activity costs about 5 cents (for $1 and $2 bills), about 10 cents (for $5, $10, $20, and $50 bills), and 12.3 cents for Benji’s.

It doesn’t sound expensive, but for every $1 bill it costs ¢1 to keep it in circulation and for a year, and as there are 11.7 billion such notes, were looking at over $110 million per annum just for $1 bills.

With cryptocurrency, there is no equivalent cost, and perhaps that is an advantage — or perhaps it is not. Paper money does not require electricity. It can be used when your battery dies.