Basic Attention Token, BAT and a new approach to ads

The Basic Attention Token (BAT) represents one of the most ambitious attempts to reshape the economics of online advertising. Created by Brendan Eich, co-founder of Mozilla and inventor of JavaScript, BAT is an Ethereum-based ERC-20 token that powers an alternative advertising model built into the Brave web browser. The fundamental premise is simple: the current digital advertising ecosystem is broken, and blockchain technology can help fix it.

Traditional online advertising suffers from several well-documented problems. Users are tracked across the web by invasive third-party cookies and fingerprinting techniques. Publishers see diminishing revenue as intermediaries consume an ever-larger share of advertising spending. Advertisers pay for impressions and clicks that are frequently fraudulent, with estimates suggesting that ad fraud costs the industry tens of billions of dollars annually. Meanwhile, the user experience degrades as pages load slowly under the weight of tracking scripts and bloated ad creatives.

BAT and the Brave browser address these problems by fundamentally restructuring the relationship between users, publishers, and advertisers. Brave blocks third-party ads and trackers by default, resulting in faster page loads and enhanced privacy. In place of the traditional ad ecosystem, Brave offers an opt-in advertising system called Brave Ads.

When users choose to enable Brave Ads, they see privacy-preserving advertisements delivered as system notifications or within the browser's new tab page. Crucially, all ad matching happens locally on the user's device rather than on remote servers, meaning that personal browsing data never leaves the user's control. Users who view these ads earn BAT as compensation for their attention, receiving approximately 70% of the advertising revenue.

Publishers and content creators can register as Brave Verified Creators to receive BAT contributions. Users can set up automatic monthly contributions that distribute BAT to the websites they visit most, or they can send one-time tips to specific creators. This system provides an alternative revenue stream for publishers who have seen traditional ad revenue decline due to ad blockers and the dominance of major advertising platforms.

The BAT token was launched through an initial coin offering (ICO) in May 2017, raising approximately $35 million in under 30 seconds, which at the time was one of the fastest token sales in cryptocurrency history. Brave Software, the company behind the browser, was founded in 2015 and had previously raised venture capital funding from investors including Founders Fund and Foundation Capital.

Since its launch, the Brave browser has grown substantially, surpassing 70 million monthly active users by the mid-2020s. The browser is built on Chromium, the same open-source foundation as Google Chrome, which means it supports Chrome extensions and offers familiar performance characteristics. Beyond its ad-blocking and BAT integration, Brave includes features like built-in Tor support for private tabs, a native cryptocurrency wallet (Brave Wallet), IPFS integration for accessing decentralized web content, and a built-in VPN service.

The BAT ecosystem has also expanded beyond the browser. Brave Search, launched in 2021, offers a privacy-focused search engine that competes with Google and DuckDuckGo. Unlike most alternative search engines that rely on Bing's index, Brave Search uses its own independent index built from web crawling, supplemented by anonymized community contributions.

Critics of the BAT model raise valid concerns. Some argue that replacing one advertising intermediary with another, even a more privacy-respecting one, does not fundamentally solve the web's monetization challenges. Others point out that the cryptocurrency component adds complexity that mainstream users may find confusing. There are also ongoing debates about whether replacing publisher-chosen ads with Brave's own ad system is truly beneficial for content creators.

Despite these criticisms, BAT represents a meaningful experiment in aligning the incentives of all participants in the online advertising chain. By compensating users for their attention, providing publishers with a new revenue stream, and giving advertisers verified engagement without privacy violations, the BAT model offers a genuinely different approach to the economics of the web. In practice, Brave and BAT challenge the concentration of online advertising revenue in the hands of a few dominant platforms, returning a measure of control and compensation to the individuals who actually create and consume content. Whether it can achieve the scale necessary to challenge the entrenched advertising giants remains an open question, but the growth of the Brave browser suggests there is significant demand for a more privacy-respecting internet.

Google, Brave, Browser, Ethereum