The Value of Basic Attention Token – Adoption of the Brave Browser

This article is not a technical breakdown of Basic Attention Token (BAT). For more information, Crypto Candor’s video is a good start.

BAT has almost everything you’d look for in a startup. The team is composed of people investors will eagerly support and they have the resources to develop the product. The main question for me is figuring out what success would mean for this project. Consider the user breakdown of the major browsers.

Screen Shot 2018-08-23 at 3.22.26 PM

Source: https://en.wikipedia.org/wiki/Usage_share_of_web_browsers

Unsurprisingly, Chrome and Safari take up the majority of users. The underlying infrastructure and good user experience are likely the biggest explanation of this dynamic. While Internet Explorer has the underlying infrastructure, the performance of the platform has been so poor that many have turned away from it. Assuming success would mean user numbers similar to Safari and Chrome, the Brave platform (3.1 million users) team has a long road to go.

For the purposes of this post, I will assume Chrome and Safari level investments would mean success.

While doing some research, I downloaded Brave. It’s awesome. Smoother UI and better overall experience than Chrome or Safari. However, I found myself going back to Chrome because all of my information was already saved on there. The time and attention to make the full switch was cumbersome. I still use the platform in specific instances, but this experience cast some doubt on adoption by non-tech enthusiasts. In other words, I’m worried that my mother would not take the time to switch browsers on her own.

If we assume getting users to adopt based on advertising leads to the previously mentioned shortcomings, then maybe a deal with Apple or Microsoft would be the best way to increase adoption. First, economic conflicts of interest makes such deals very unlikely. Putting such concerns to the side, in the case of Microsoft, logistical concerns would be a huge barrier. With so many corporate clients using IE, integrating a new browser would be very difficult. However, they own Simul and github. A ton of people use Simul for office coordination and increased developer support through github is also possible  (especially with the privacy capabilities offered by zkSNARKS). However, even with developer adoption on that level, I’m not sure the network effect in that context transmutes to the general public. Privacy or having to wait an extra 3-5 seconds for a page to load is not even considered a problem for most users. There are also other less ambitious companies attempting to solve the problem in a simpler fashion. While these companies have very different approaches, they will be able to plug into existing infrastructure.

My skepticism is based on the assumption that BAT would need Chrome/Safari levels of adoption for success. If this is not correct and Firefox levels of adoption would count as success, the project seems more promising. That level of adoption in addition to the speculative value generated by interest in cryptocurrencies could lead to a significant increase in the price of the token. For these reasons, I believe the project’s current market cap ($205M) is undervalued and believe they are a good medium term investment 2-5 years.

This is not investment advice. I am not a financial advisor.


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