We are excited to introduce our new blog interview series, LoopMe Listens, where we’ll be interviewing leading professionals in ad tech on relevant topics in the industry. Kicking off our series, we spoke with Joseph Olewitz, founder and CEO of Virtual Chief Revenue Officer, which provides revenue growth support to businesses of all sizes.
We were lucky enough for Joseph to break down the buzzword that is blockchain and it’s counterpart, cryptocurrency. In this blog Joseph will be covering misconceptions of blockchain, how it’s useful for marketers and advertisers, and what’s in store for this technology in 2019.
If you had to describe blockchain in 3 sentences in less, how would you describe it?
A blockchain is a permanent, encrypted record of information and transactions, distributed among a large number of diverse devices which approve and maintain the record by consensus.
Blockchain’s efficiency provides for cost and time savings in a trustable environment that will lead to transformative new ways of doing business and of handling critically important and sensitive aspects of our personal lives.
The technology is useful for storage and transfer of assets and information, it is different from existing systems because it uses algorithms and design to deal with trust instead of relying on external trusted third parties, plus the opportunities provided by the technology, including operational efficiencies and allowing access to underserved parties, are revolutionary.
What is cryptocurrency?
Cryptocurrency is a payment system based on complex mathematical formulas and puzzles designed to hide the solution from anyone who doesn’t have a unique key (cryptography). It works as a medium of exchange in lieu of commonly familiar checks, coins, paper currency and wire transfers.
In 2009, Satoshi Nakamoto, a still unidentified person or persons created the idea of cryptocurrency – a peer-to-peer digital cash system (no paper, no coins) that does not rely on the backing of a central entity like a government and a bank for transaction processing, and he designed it to be built on a blockchain.
Satoshi’s work was published in a relatively easy to digest nine-page white paper. As a result, Bitcoin became the first widely used application of blockchain technology in much the same way that email became the first widely used application of the internet.
How is blockchain useful for marketers and advertisers?
Blockchain will remove the middleman and give marketers direct access to consumers. This decentralization is a transformative event in promotion and advertising.
The ability to accurately track and report viewership, especially of video content, will greatly enhance understanding the ROI received from ad dollars spent. That same ability will empower agencies and application providers to prove ROI they are delivering to marketers, and to prove the targeted market is being reached, thus justifying campaign plans and subsequent results.
Fraud will be massively minimized and, in some cases, totally eradicated. Imagine completely stopping bots and other bad actors who misrepresent viewership in order to derail and redirect ad dollars.
Marketers will be able to build trust with consumers and be able to more accurately target the desired demographic without negative reactions. That will happen by requesting permission and sometimes by making payments directly to consumers for watching promotions (no middleman needed).
The blockchain will allow returning privacy and control of their personal data to consumers who will then be able to determine who gets to see which data about them and for how long. As a result, marketers may generate fewer leads and impressions. However, the ones they do generate will be stronger and of much higher quality.
What are the common misconceptions of blockchain?
- Blockchain is a panacea to solve all problems – it’s not.
- You need to understand blockchain to use it – I ask: do you understand how the internet works?
- Blockchain and Bitcoin are the same thing. Nope. Blockchain is a distributed ledger providing security, privacy and transaction verification. Bitcoin is a cryptocurrency built on top of a blockchain that facilitates secure payment between two parties without an intermediary.
- Blockchain is ready for primetime now – it’s not! It’s all happening at a dizzying pace but we’re still in the infancy of a new technology, similar to the internet in the 60s and 70s before the world wide web arrived in the 90s.
- In the future one will need a blockchain to make simple payments to children in college or to a friend for the beer he bought at the bar last night. Not so. There will always be non-blockchain methods for direct payment between two parties when that is appropriate, maybe including fiat currency, IOUs, barter, and much more.
What are you most excited about in 2019 when it comes to this technology?
Disruptive technologies are developing and improving at a much more rapid pace than ever before. I believe that in 2019 we will see blockchain experience a significant leap forward in these arenas:
- An increase in deployment of Enterprise applications of blockchain.
- Costs related to blockchain will come down while transaction speed increases.
- Business and personal life improvements created from the marriage of blockchain and Artificial Intelligence.
- A reduction in hype and get-rich-quick schemes arising from the broad increase of knowledge and awareness around these new technologies.
- A broad understanding of the value derived from separating blockchain and AI from cryptocurrency and fintech applications. Those currency and financial applications are extremely valuable and while blockchain is the foundation technology under almost all cryptocurrency applications, blockchain is also hard enough to understand as it is, and we get distracted from the potential business uses when we equate the two.
- Beginning the establishment of standards that will work across platforms and across industries. Right now, because many blockchain actors are working independently and without standards the technology will not be able to scale.
- Broad resolution of securities laws and development of practical considerations around ICOs and Token offerings (including liquidity, exchange, taxation, and much more.)
- Someone developing the blockchain equivalent of the world wide web which in the mid-90s gave developers and consumers a path to easily develop for and use the internet. That development and consumer access allowed an explosion of uses and users of the technology. We need a similar “on-ramp” to demystify blockchain.
