Blockchain for dummies (and photographers)

As a photographer, you may think that technology is not something that impacts your career as much as others’. But in fact, when it comes to the way you sell your works, technological advancement is key to you getting the most income for your efforts.

Currently the majority of photography is sold through photostocks — large corporations that control how much and how many of your photographs you sell. But it is time for a revolution. Here at Photochain, we are building a platform that allows you take back control of how you sell your photography. For an overview of what we are aiming to do with Photochain, please have a read here.

To do this we will use blockchain technology.

What is blockchain?

Blockchain as we now know it, first came to light in 2008 when Satoshi Nakamoto, the infamous pseudonymous creator(s) of bitcoin released the original framework for a new digital based money (“cryptocurrency”). This new type of money was shown to be a possible alternative to traditional currency (at the time the financial crisis was settling in, so it was most relevant to this).

However, it was the underlying technology, a system of “blocks” (recorded information) that were linked together in a timestamped chain. This timestamp created a fixed order of the information and all blocks were linked in a chain. This chain employed distributed ledger technology, that is all participants on the network had access to the same chain of blocks, which is updated every time a new transaction occurs.

Overall this means that each user has the same record of which transactions have occurred, making it impossible to forge new transactions. Banks and other financial intermediaries that normally did the job of providing trust in the system, were no longer needed.

This is what gives rise to the term decentralisation. As the ledger of transactions is not centralised in one institution, everyone holds an identical copy of the ledger, then the system is known as a decentralised one. I.e. there is no central power that can influence or is responsible for the upkeep of the transactions.

Some very smart guys realised the potential of such a system to completely reinvent the way we transact and share information. Bitcoin, as the first and still most famous form of new digital money, was only the first application of blockchain technology.

Since then we now have blockchain projects such as Ethereum — which removes the need for paper based legal contracts and bureaucracy. Ethereum blockchain allows what is known as Smart Contracts. These exist in either 2 states, true or false. Once a contract is triggered to be true, the condition of the contract is automatically completed. Whether that be pay someone some money or send someone a photo.

Whats the relevance for me?

In a traditional sense, we use intermediaries such as a stock photography platform to manage our data. In this example a photographer must register with a stock photography platform and then hand over their photographs to them for selling them to the clients..

Often times this means that you must hand over the licensing rights to your images to the stock photography companies themselves. As they are the ones who take on the risk of selling these photos and other costs, such as marketing costs, legal costs and others, they tend to want a larger share of the proceeds. Essentially the trust in the business side of things is handed over to the stock photography companies.

As an example, one of the biggest stock photography platforms is taking in average 77% commissions (for smaller contributors partially 90%), meaning the photographer who may have sat for hours to get the perfect shot only gets a small fraction of the income for their own work and — on most platforms — can’t influence the price.

With a decentralised system, as there is no middle man who earns high commissions, all parties actually profit from significantly better economics.

What is a Dapp?

A decentralised application (dapp) is an application that is built on blockchain technology. In the current world of applications (think those apps you have on your smart phone — Uber, Google, Airbnb), you as the user do not have control over your uploaded data. The app producer acts as the central controller of all your data and they are the ones that will transmit them to the other party in any transaction.

Decentralised applications can perform all the same functions as a traditional app, but they connect users directly. In Photochain for example, sellers are connected directly to buyers, without a corporate middleman.

Dapps therefore have many advantages over existing applications — user data is not manipulable by anyone nor is it is accessible by anyone other than the user themselves. Users can even remain completely anonymous to the other party in a transaction: as a users information is verified and linked to an Ethereum address — the whole network validates this through its inherently built trust. Only the address’ information is sent to the receiving party, not the verified identity data. So the receiver doesn’t know who that user is, they only see the incoming address as the sending party.

In general every dapp has it’s own cryptocurrency (called “token”) as a unique and independent means of payment within the closed ecosystem. Tokens can also have other uses such as voting rights or as a reward for completing certain tasks stipulated by the dapp.

In the Photochain dapp, the Photon token is to be, firstly, the payment currency of the Photochain community. All photos will be listed with a price in Photons and buyers will need to send Photons to the seller’s wallet before they are able to access the photography which they have purchased. Photons will also be paid to those users who help identify copyright infringement on the platform. This reward system incentives users to actively point out possible fraud cases, as they have an opportunity to gain from doing so.

How else to get my hands on some tokens?

A dapps’ token is usually released to the public in what is called a Crowdsale or Initial Coin Offering (ICO). This is a process where you may invest in the development of a blockchain project, receiving a share of tokens in return. These tokens are then later used as the currency of the system.

If you miss out on buying tokens in the Crowdsale, not to worry, as they will be available on major cryptocurrency exchanges. But the risk is that you will have to pay a lot more later than the price you could have got during the Crowdsale.

Photochain will be be holding the first round of its own Crowdsale, the pre-Crowdsale in the coming weeks. To find out more about how to take part and receive a 30% discount as an early investor, please sign up with your email address at photochain.io.

In the next article we will look at how the Photochain platform works and how you will go about gaining and spending Photons. We look forward to hosting your photography on the dapp!