A open source protocol for exchanging data in a fair and open way
Nowadays, if you want to find more customers or maybe to increase your company/project popularity, you will have to use services of Big Tech - duopoly companies which control 60% of the advertising industry. These Big Tech companies control user data, user information, make money from it but never pay a single cent to their users. They also decide the price of every single Ad-Tech, which will make the advertising market become an unfair market. Thanks to Fractal Protocol, users can now receive rewards for sharing and verifying their data. Fractal also aims to create an incentivized system built on trustless and transparent infrastructure to ensure the best possible outcomes for users, publishers, and advertisers.
Key Features And Highlights
Posting Ad Buys: An Ad Buy is a public sign of demand for a certain User action by an Advertiser. Ad Buys include the following parameters:
1. Required action and action type (e.g., CPA or CPM)
2. User characteristics (e.g. 30 - 40 years old or ‘qualified investor’)
3. Bid price (e.g. 40 USD equivalent / action)
4. Ad Budget (e.g. 4.000 USD equivalent in total)
Data Claims and Credentials: Users can share attestations of their characteristics and relying parties (in the protocol, Verifiers and Advertisers) can confirm such attestations exist and have not been revoked.
Users make claims that certain data is true about themselves (“Data Claim”) to Attesters (e.g., “I am a Portuguese citizen”) and request Attesters to verify that such a Data Claim is truthful. The Attester performs the verification work according to certain criteria (e.g., requiring the submission of a Portuguese identity card). If the Attester determines that the Users’ Data Claim is truthful, the Attester issues the User a “Credential”. This Credential is transferred to the User’s control (for example, stored in a browser plugin that functions as a data wallet) and from then on it can be shared with relying parties in a privacy preserving manner.
Ad Claims: Empowered with Credentials, Users can decide to share data with Verifiers. When Users land on a website, the Verifier (which can be the website itself or a third party working with the website) makes an ad request enriched by the verified data the User potentially decided to share. The ad request communicates the ad inventory available and the characteristics of the User visiting the website. The Verifiers’ ad request will compete to win the Ad Buys posted by Advertisers. If the Verifier wins an Ad Buy, the relevant ad unit will be displayed to the User. Users’ data wallets can claim that the User performed the Required Action specified in the Ad Buy (“Ad Claim”). Once an Ad Claim has been publicly posted, it is pending verification by the Verifier. Siloing the Ad Claim and its verification in different actors (the User and the Verifier, respectively) increases transparency, therefore improving fraud monitoring (e.g. it allows for identification of Users with plenty of unverified Ad Claims regardless of Verifier, or Verifiers with plenty of fraudulent verifications regardless of User).
Verifying Ad Claims: Verifiers attest to whether Users’ Ad Claims are truthful or not. This verification relies on signals not present on-chain and, therefore, the Protocol is agnostic to the criteria used by Verifiers to decide whether or not to attest Ad Claims. To confirm that an Ad Claim is legitimate, the Verifier puts the bid price amount in escrow (the “Arbitrage Escrow”).
Insurering the verification of Ad Claims:
Insurers provide liquidity to the Arbitrage Escrow. Insurers can be anyone who wishes to lock-up funds (in FCL) in the Arbitrage Escrow with the goal of earning rewards. Insurers stake FCL on Verifiers of their choice and, in return, receive a percentage of the payout that flows to those same Verifiers when an Ad Claim is verified and the Advertiser does not rescue the Arbitrage Escrow. The market acts as a pricing discovery mechanism for the percentage due to Insurers (e.g., Insurers should be able to command higher prices from non-reputed Verifiers). When Advertisers claim the Arbitrage Escrow, Insurers also participate in the loss. This creates a market dynamic where trustworthy Verifiers have more liquidity than fraudulent Verifiers. Because the liquidity Verifiers have in Arbitrage Escrows is directly related to the volume of Ad Claims they can verify, this results in more Ad Claims being verified by trustworthy Verifiers, therefore mitigating fraud within the Protocol.
Market Price Formation:
The combination between the elements of Advertisers’ Ad Buys (required action, user characteristics, and bid price) and Verifiers’ ad requests leads to evolving ad markets. Standardized communication of types of required actions and user characteristics enables a
fair price-finding mechanism for different clusters.