NFTs as Memory

Since Bitcoin represents a form self-sovereign money, I believe that NFTs can and will represent a self-sovereign data store; from that, we could see a valuable method for end-user data custody.

Introduction

Humans have used objects to represent actions for millennia. Before writing, Americans used knotted ropes to represent debt (an expected future action), ownership (current action), and history (past actions). While writing is a very recent development compared to the thousands of years our species has existed, some would argue that humans have adapted to associate memories with objects. One example of this would be the strength of the "method of loci" as a means of upgrading one's memory. In the past decade, we've slowly but surely moved to the digitization of many externalities. Technology companies that facilitate this have generated massive amounts of value for the world, encouraging more companies to join in the data-as-oil arms race. The downside to this is surveillance capitalism (SurvCap), where these same companies begin to track more and more user data in order to monetize the ownership and interpretation of customer/user data. In the process of tracking more information about their users, they indirectly profile end-users in order to "nudge" (read: influence) users to make purchases that they may not have made without seeing 15 ads for the same lamp.

In addition to these companies profiling users, many have insufficient data storage policies, leading to breaches that widely go unpunished or under-punished. GDPR, while seen as a victory for users and their data privacy rights, only made it harder for non-incumbents to compete in the  online ads markets that technology company giants have created. Since these companies had enough of a war chest to operationalize GDPR while protecting their business models, this only centralized power between the few. This leads to a situation where more and more apps are simplifying day-to-day interactions for free, which is great for emerging markets who have been left behind. But it creates the scaffolding for the hard stratification of EMs and DMs (emerging markets and developed markets), leading to stronger economic divides over time. This demarcation would likely be between consumers who have access to censorship-resistant money and data, and those who do not.

As we see with cryptocurrencies, most developed markets have reliable fiat on-ramps with bank relationships. Between Coinbase, Gemini, Kraken, FTX US, and Binance US, there is no shortage of places where participants in supported markets can purchase cryptocurrencies, allowing users to subvert the reach of surveillance capitalist states attempting to track and monetize their behaviors without consent. For a number of reasons, not including infrastructure and regulatory issues, EMs do not have as many options for vocal exit away from the surveilled silos of traditional tech companies. It follows that people living in EMs by and large do not have as much access to alternative systems as people within the US; as a result, people across the world are placed in scenarios where the only accessible option is to exchange your privacy or agency for access to modern technology.

As it stands, things have changed with the proliferation of cryptoassets and crypto-native mediums like cryptomedia. As a result of the creation of Bitcoin and Ethereum, people now have the tools needed to build digital frontiers based on their own personal or group-specific visions. One of the more recent tools for user agency is an NFT, or non-fungible token. While Bitcoin and colored coins were the original NFTs, NFTs in their contemporary sense usually refer to digital bearer assets issued on permissionless distributed ledgers.

Main Premise

Since Bitcoin represents a form self-sovereign money, I believe that NFTs can and will represent a self-sovereign data store; from that, we could see a valuable method for end-user data custody. The custody of this bearer-style data would occur within cryptographically secured wallets (or backpacks) owned by the user or users whose data were stored on it. In this sense, it would act a lot like the cookies of the current web, but with added benefits:

  • It would allow users to own all of the data generated by the app, in a way that promotes user agency.
  • It would document relevant user interactions in ways that the user is able to verify, better allowing users to recognize and more mindfully interact with the internet.
  • It would allow ad market participants to temporarily (peek) or consistently (subscribe) use this data for a period agreed upon by the user.
  • It would protects content and access to user data from companies or entities who have not received approval to access said user's data.
  • It would verify that a given user's data is not publicly available to people not subscribing or paying for said data.
Like this, on the blockchain! Credit: Lucasfilms

User data is like a river: it works best as a public good, but is being restrained and contorted to funnel away from the users. Ideally this would allow for the modular import and export of their own data. Using an NFT to track events could be presented in a number of ways:

  • An NFT that, similar to Apple ID, allows for me to sign in across products pseudonymously. This could be used in addition to signing in with a wallet, but with an NFT, this allows a user to choose which wallets are used to hold cryptographic keys at a given time. The ability to abstract state updates to the NFT allows for services to rely on either creating or updating said NFT, depending on whichever method is more efficient.
  • If I were playing a game, the NFT could track ownership of other NFTs (if not directly tied to ownership of my wallet), off-chain items, decisions made, my levels, etc.
  • This would allow for cross-media opportunities that feel less like you're being watched without your informed consent. By allowing the user to prove that the ad or connection was made based on a discrete action, the user is better able to understand the connection, and harbor less or no resentment for being served a relevant ad. In a crypto context, it could look like Atomic Blue's Degen Score, where access to certain products are walled off for provably experienced users.
  • If the app I was using served ads, or I opted out through a pay-as-you-go scheme (subscription or micropayment stream), the NFT would act as a proof that I had opted-out or otherwise should not be served ads.

Considerations

Below are some considerations needed for this to become a thing:

  • A permissionless ledger with robust on-chain and off-chain state.
  • An internet browser and phone that allows for user interaction to be written onto this NFT.
  • Scaling solutions that allow for Mixpanel-level granular data to be added to an NFT, or a worker that can verifiably that data isn't incorrectly associated with other users.
  • An agreed-upon set of standards for storing user data across services and blockchains.
  • A ¬†means for users to trustlessly import/export data on a memory-storing NFT on Chain A to another NFT on Chain B.
  • A means for users to remove or burn the NFT.
  • This would also need to be open-source, and developed in a way that circumvented phone manufacturers' attempts to house all data in order to make exiting the platform convoluted enough to make people never want to leave. They could argue that this bearer-style memory card was a security breach, block the roll-out and use of it, and issue their own version of this that is distributed enough to provide the semblance of freedom, but not to the point where their business lines are disrupted. For instance, you can take your phone's cryptographic "keys" or certificates to whatever TeaPhone you want, but not to a CoffeePhone, and vice-versa.
  • In the future, performing these actions on a chain where, through techniques like ZKPs or FHE, successful read/write can be limited to occasions where the user allows it. This is arguably a very necessary piece for distributed identity, as displaying all user data on-chain in a transparent manner may lead novice users to expose more information than they intend to, in ways that cannot be easily undone.
  • Systems that incentivize users presenting this NFT as a Proof-of-Work, in order to incentivize users to use and retain the NFT over time
  • Sufficient composability across services such that different platforms create a network of complementary features based on data stored on the NFT.

Follow-on Thoughts

2021 Update

I wrote the bulk of this in 2019, and a lot has changed since then! In the last 6 months, NFTs have skyrocketed in terms of awareness, social interest, and on-chain transactional activity. Plenty of individuals who have spent years creating digital art have the opportunity to now mint their work as an NFT and sell it online. This has presented a disintermediation of the traditional art marketplaces taking large cuts of sales, and has also given new and experienced artists a way to build direct relationships with their audience and their collectors. We're also seeing Ethereum gas fees price out many individuals who stand to benefit most from the disintermediation of expensive art marketplaces, and believe that scaling solutions can help with this. There are also conversations about the ecological cost of minting NFTs, and hope that we're able to move things like NFT minting and NFT state updates to to channels, sidechains, or Layer-1 chains with higher transaction throughput and a reasonable carbon footprint. As the world begins to explore and extend the use cases for crypto-native bearer assets like cryptocurrencies and cryptomedia, I hope that we'll see more use cases where people explore using NFTs to store a record of user actions.


Editor's Note: I'm in no way an expert in this topic, but I welcome any and all constructive feedback. If this is built on a flaw, I'd love to hear it. I recognize that most of this info is on-chain anyways, but still think that understanding all of the reasons why this may not be as feasible a solution can guide conversations and actions towards better solutions. I would also love to build this; I believe this is a powerful way to democratize access to user behavior and data. Ping me on nevergreen.app if this excites you. Let's build some dissident tech.