Masmic — a crypto-based micropayment model of social collaboration
Cryptocurrencies and blockchain technology are increasingly sparking the imagination of people all over the world because of its strong value propositions.
The two important ones which are often talked about are:
i) It enables two entities/people to transact with each other without any need of trusted third party. This leads to reduction of custodial risk, enables disintermediation, and fast and direct transactions.
ii) It enables value transfer over Internet between two entities/people through open permissionless networks, overcoming a long standing issue of “double spending”. Before cryptocurrencies, Internet allowed only instant flow of information and not instant flow of value. But cryptocurrencies which are digital native currencies makes instant flow of value across the globe a reality for the first time.
But there are two other under-appreciated benefits which come through cryptocurrencies —
i) The world of crypto-economics and ii) Micropayments. And both these benefits are major offerings of Masmic.
Crypto-economics essentially means designing the ecosystem in such a way, in terms of incentives and disincentives for participants, that all the participants naturally behave in a rational manner and which also serves the interest of platform at large.
Micropayments have been made possible for the first time through cryptocurrencies. This means it is now possible to even transfer/exchange a value of less than a cent ($0.01) instantly across the globe. This is not possible in the current PayPal world because of higher transaction costs.
A crypto-economic system based on micro-payments enables a network to be open and meritocratic built on market principles.
In Masmic’s success as well, it became very important to design the crypto-economic incentive model in such a way that all stakeholders/participants find maximum benefit on the platform.
In Masmic, all new posts will have economic value attached with them. Whenever a new bounty/task/gig/question is posted on Masmic with an economic incentive, it’s very important that the contributions are as best as possible and these contributions are ordered quality-wise in a rational manner to the maximum extent possible.
In order to implement the above vision, we took help of game theory. Game theory has applications in situations where parties/players make decisions which are interdependent, i.e., what a player does will depend on what he thinks others will do.
Let’s see how this game theoretic model is utilized in Masmic:
i) The number of rewards of every bounty are limited and these rewards are non-linearly divided among eligible participants. This means that not all contributors may receive a monetary reward for contributions, which will depend on the number of rewards as chosen by bounty giver. Additionally, the top contributor will earn much higher as compared to bottom eligible contributor. Because of this, every participant will be motivated to fight for the top spot. If someone is spending time in completing a task/bounty/gig, he would naturally be looking for maximum possible compensation. Due to this healthy competition, the quality of answers will be enhanced.
ii) There are monetary rewards linked to quality sorting of all contributions. And these monetary rewards are linked to whether good answers were chosen or bad answers were chosen by a sorter, as seen from the final list obtained through wisdom of the masses. So, any sorter will be looking to upvote those answers which he thinks the crowd will also choose, as opposed to just going with his personal bias.
Seems confusing?! Let’s better understand this through an example:
i) A bounty giver wants to get user feedback on his newly launched website and comes to Masmic and starts a bounty worth $10 of cryptocurrencies.
ii) This bounty giver assigns a total of 5 rewards for answer contributors, which will be non-linearly distributed. Also, he assigns the total bounty time as 5 days.
iii) User contributions start coming in and everyone tries to contribute best possible answer (i.e. feedback to the website). This is because the top contribution gets disproportionately higher share of $10.
iv) Users also help in sorting these contributions because there is economic incentive linked to it, given from a part of the bounty reward.
v) As the variety of questions increase, content consumers will also benefit from reading through meritocratic social collaboration.
Now, what do we ideally get out of this process? The following:
i) Only quality questions/gigs get posted which can have some economic incentives attached to it. So, although Masmic will have much less number of questions as compared to a free social network, but the quality of questions/gigs will be much higher.
ii) High quality submissions/contributions ensured by game theoretic reward mechanism.
iii) High quality sorting of answers again ensured by game theoretic monetary incentive mechanism.
iv) High quality content for consumption for all the users of the platforms.
Thus, this model theoretically serves the needs of all stakeholders of the platform:
i) Bounty Giver
ii) Answer Contributor
iii) Answer Sorter
iv) Content Consumer
In order to turn this theoretic model into practical success, community support will be essential. We hope that all of you, including crypto supporters, will help in growing the whole ecosystem. Masmic’s growth won’t be possible without your support.
We will launch the platform very soon and for the initial 1 month, only email subscribers will get exclusive access to the platform.