Cryptocurrencies may be the new and popular currencies of today, but there is another form of currency most people don’t think about that is far more valuable.
That currency is your personal data. Facebook is worth $500 billion for a reason. Just recently, Facebook was hit with the news that a political data firm had managed to gain access to 50 million users’ data through sketchy means, and without their consent. The firm had done so by using a popular Facebook personality quiz as a Trojan horse for harvesting users’ data.
Facebook’s stock fell by 4% in a single day, wiping $40 billion off its value. This shows that people are becoming increasingly uncomfortable with just how vast the amount of personal data they and other mega sites are collecting. People want to be in control of their data.
Companies also act as data silos, hoarding information from each to other to maintain a competitive edge. A popular example was LinkedIn, which abruptly restricted access to its helpful open API, killing a thriving developer environment (over 30,000 apps were built on this API). LinkedIn, which was acquired by Microsoft for $26.2 billion at the end of 2016, even tried and failed to prevent third-party services from scraping its publicly available data.
Therefore, the current centralized data sharing model is problematic for both users and companies. Users don’t have full control over their data, plus companies are hoarding data from each other.
Decentralizing the Data Sharing Model Using Blockchain
Blockchain is the natural solution to this data hoarding behavior. The creators behind Dock.io want to create a world where users have full control over their data and companies share data with each other, instead of keeping it in data silos. Users control exactly what data is out there, while companies are prevented from selfishly hoarding data. A win-win situation.
Dock.io, which just successfully completed its ICO in February 2018, has created an ecosystem which does just that. In its initial use case model, the company envisions itself as something of a ‘decentralized LinkedIn,’ where users can share information such as employment history, educational background, and certified skills.
How Users Share Their Data on Dock.io
The idea is simple: users and companies/applications connect via the Dock.io platform (built on Ethereum). Users can choose which data they upload to which application, with each user-application relationship being recorded in its own smart contract. This is a big difference from current ‘data silos’ like LinkedIn where users can only control what data is shared with other users and third-party applications while LinkedIn has full access to their information.
Users can choose to share data in an unencrypted or encrypted form. Unencrypted data or ‘public data’ is data that everyone on the network will be able to see. This will probably be non-sensitive data such as name, education history, and location, although what each user considers sensitive or non-sensitive would obviously vary. However, once published publically, the process cannot be undone; the data is out there and publically accessible forever.
The second type of data is encrypted or ‘private data.’ This is the default mode. Only users can decrypt this data or authorize an application to decrypt it. This helps ensure that users stay in full control of their data.
The data itself will have varying formats, with the company stating in its whitepaper that the community will be able to choose data formats for itself. Of course, a particular data format can only be useful after a certain critical mass. Standardization of data formats is probably a necessary and logical next step for the Dock.io protocol as it matures. To start off, Dock.io will have a resume and work history data format.
Dock.io’s solution is what it calls ‘data format signaling.’ Here, applications which are also token holders can signal their accepted data formats. These signals are non-binding and thus is only a hopeful solution that relative data format consensus will be achieved via natural market equilibrium.
A Few Technical Details…
Given that the Ethereum network already has congestion issues when the only thing stored on its blockchain is the hash data, there’s no way that Dock.io can store resumes and the like. Dock.io’s technical solution to this problem is by using the IPLD specification, which was developed for IPFS to perform content addressable data exchange.
IPFS stands for Interplanetary File System, and it is an open source peer-to-peer storage protocol. An IPFS network consists of a collection of nodes, each of which stores a collection of hashed files. When a client wants to retrieve a particular file, they just call the associated hash from the blockchain.
Think of it like a torrent network. It is decentralized storage and upload, with each file having a particular (and much smaller) torrent file which is actually stored on the network itself. This is what allows Dock.io to store only the hashes on the Ethereum blockchain. The data itself is stored with the user; the user is his own node.
However, the company has also mentioned that they may move off the Ethereum blockchain in the future, if necessary, and begin its own standalone blockchain.
Tokenomics and Incentives – Dock.io’s Different Data Sharing Model
Dock.io’s tokenomics model is pretty unique. It’s not the kind of token model you would expect the company to have if you heard ‘decentralized data storage’.
Firstly, Dock.io only wants to its tokens to be denominated in fiat, as opposed to ETH or BTC. The reason is to encourage long-term price stability. Given how volatile even the major cryptocurrencies are, this may be a wise choice.
Second is its incentives model, which leaves users out of the picture.
Incentives for Applications
In the Dock.io ecosystem, applications are incentivized via Dock tokens to share information with each other. If Application A created the data, but Application B wants to use it, Application B will have to (indirectly) pay Application A for said data.
However, the catch is that this sharing is not voluntary. Application A cannot prevent Application B from paying for that data. Only the user has the sole right to determine how his of her data is going to be used. Unless the user explicitly bars his data from being used by Application B, Application B will be able to pay Application A to access this data. This is Dock.io’s solution against data hoarding; only the user decides.
Incentives for Users
Going against conventional expectations, users are deliberately NOT incentivized to share their data with applications for Dock tokens. This is where Dock.io’s higher vision comes in; people should realize that their data is much more valuable than they think, and whatever price that is usually paid for them is always too low. The best way forward is for people to value data for its own sake.
A more pragmatic reason is that the company doesn’t want users trying to scam the system through means of spamming and false information. When people begin to play the system this way, it becomes a quick race to the bottom that Dock.io wants to avoid. Also, it keeps things more convenient for users, who do not have to deal with microtransactions and payments.
So what is Dock.io offering users then?
Two words: control and convenience. Users will have full control of their data, being able to determine what is out there and who has access to it. They will also be able to do this easily from one central platform. This would allow people to keep their profiles updated across the web, making sure the right people are always looking at the most updated data. No more outdated profiles floating around the web that you haven’t updated in years.
Ecosystem and Partnership Incentives
30% of the total 1 billion token supply will be set aside for ecosystem incentives. This means that this portion will form sort of a ‘rewards pool’ that will disburse tokens in order to promote the growth of the Dock.io ecosystem. This is a standard operating procedure, and similar mechanisms can be found in most blockchain projects.
Token Burning Mechanism
The Dock token will also have a burning mechanism. One reason for this is security, making it harder for spam and Distributed Denial of Service (DDOS) attacks. Another is to reduce the supply of Dock tokens over time, which should, in theory, create upward pressure on its price. This is one solution to the ‘velocity problem’ that almost all utility tokens face.
However, this can create its own problems regarding incentives and might lead to excessive speculation. As of this writing, Dock.io has not elaborated further on its token burning mechanism. Once it provides more details, you will be able to make a more informed analysis of how the token will perform.
Dock.io Development Status and Roadmap
Prior to the token sale in February 2018, Dock.io released its alpha app in January. Through the app, people can already start to centralize all their personal data on a decentralized network. Dock.io boasts that as of this writing, it has over 15 million users with three partner apps: Fund Request, Remote.com, and Smart Recruiters. The latter two are job-related, the first is an open source collaboration platform.
However, this ‘15 million’ figure likely includes the total of users on the aforementioned partner apps. Elsewhere on the website, Dock.io mentions having 200,000 registered users; this is probably the true number signed up only to the Dock.io app.
The company has noted on its roadmap that it intends to begin partnership integration in the second quarter of 2018. In the fourth quarter, the company plans to open up the ecosystem to developers and allow applications to be able to share data in exchange for Dock tokens.
However, nothing has been listed after that. Based on the company’s statements, it is likely that future development of the protocol will be determined by how token holders vote. The company has also mentioned adding a vouching and reputation protocol, similar to how the current LinkedIn skill endorsements function.
Dock.io’s ICO: $20 million Hardcap Achieved
Despite being the target of a massive scamming and phishing campaign, the team stated that they managed to limit community losses due to scams at 0.7%; which is pretty impressive. Also, Dock.io hit its $20 million hardcap (including private sale and pre-sale) within only a couple days from its public sale with over 10,500 unique participants. 30% of the total token supply of 1 billion was sold. Interestingly, the ICO price was quoted in dollars and not ETH.
All in all, it was a successful token sale for Dock.io and which bodes well for its short-term prospects. Nevertheless, many people who wanted in on the token sale did not manage to get in. One reason was apparently due to ETH ‘gas wars’ where miners where simply refusing transactions that had too low quoted gas amounts. Also, the tiny minority that did get scammed were none too happy.
As at the time of this writing, the tokens sold during the ICO are still unreleased. The Dock.io team is testing out their voting mechanism to let the community decide when the Dock tokens should be unlocked and released.
The Team behind Dock.io
The two founders behind Dock.io are Nick Macario and Elina Cadouri. Nick founded branded.me, which since his exit has become Remote.com and is one of Dock.io’s partner apps. Elina was a co-founder of Outsource.com, which appears to have become defunct. Their core team also boasts developers and software engineers with impressive backgrounds.
What are the Short-term and Long-term Potentials of Dock.io?
Dock.io’s short-term prospects look good right now. In addition to its successful token sale, the project has a massive Telegram group with almost 65,000 members, almost 18,000 Facebook members, and over 33,000 Twitter followers. However, its subreddit is (suspiciously) not very active. Nevertheless, on balance, Dock.io looks to have good short-term momentum. The release of the tokens followed by a listing on a major exchange could be the next major catalyst for the project.
Over the long term, Dock.io does have an admirable vision for how the personal data economy should look in the future. Ultimately, however, its success depends on getting all the major partners on board its network. Users do not receive any token incentives, only control, and convenience. Hence, if Dock.io is unable to get companies with substantial user bases such as LinkedIn onboard, the project may never reach critical mass.
Another issue that may affect Dock.io’s long-term potential is the data format question. If data formats don’t reach a reasonable level of standardization, users will have less convenience and thus less incentive to use the app.
Finally, there is also the issue of regulatory risk. The EU has just instituted its strictest personal data protection regulation yet, the GPDR. In time, other countries may follow suit. And while Dock.io assures us in a blog post that it is fully compliant with the principles of the GPDR, that is hardly legally binding. In the personal data space, regulatory risk cannot be ignored.
What do you think of Dock.io? Will it help usher in a new model of personal data sharing? What are the tokens’ prospects? Let us know your views in the comments below.