Micropayments Tied to Attention Reputation

Users generate immense value through attention and data, but intermediaries capture >50% of ad revenue. Attribution is opaque, and creators are underpaid.

• Value Leakage: Platforms like Google/Facebook siphon ~$0.40 of every ad dollar.
• No Direct Relationship: Users are products, not counterparties.
• Inefficient Markets: Attention is bundled and sold in bulk, not per-impression.

Layer-2s like Arbitrum and Base enable sub-cent transaction fees, making micro-payments viable. Protocols like Farcaster and Lens Protocol provide portable social graphs to tie payments to identity.

• Cost Basis: Transactions for <$0.001 on Optimistic & ZK Rollups.
• Composability: Streams from Superfluid or Sablier can be attached to any on-chain action.
• Reputation Layer: Worldcoin (proof-of-personhood) and Gitcoin Passport mitigate sybil attacks.

Users express intents (e.g., "pay $0.10 per minute of engaged view") fulfilled by solvers. This moves beyond simple transfers to attestation-based payment curves.

• Fulfillment Networks: UniswapX and CowSwap demonstrate intent-based architecture.
• Conditional Triggers: Oracles like Chainlink verify off-chain events (e.g., video watch-time).
• Attention Proofs: Projects like Hype and Story Protocol encode engagement as verifiable claims.

Reputation scores derived from consistent, valuable engagement become a capital asset. This enables attention-backed lending and superior curation markets.

• Monetizable Rep: High-quality attention history can unlock lower borrowing rates or airdrops.
• Curation Markets: Platforms like Karma3 Labs (OpenRank) rank content via peer attestation, not ads.
• Anti-Spam: Paying for attention inherently prices out bots, increasing signal-to-noise.

Credit card fees (2.9% + $0.30) make $0.10 payments impossible. This kills models like pay-per-article or per-second streaming.\n- Fee Inversion: Fixed costs exceed transaction value.\n- No Global Settlement: Cross-border micropayments are a non-starter.\n- Chargeback Risk: Makes small, automated payments commercially unviable.

Protocols like Lightning Network and zkSync's Boojum enable instant, sub-cent transfers by settling off-chain. Reputation is built via channel longevity and liquidity.\n- Sub-Second Finality: Enables real-time attention monetization.\n- ~0.001¢ Fees: Cost structure flips from prohibitive to negligible.\n- Sybil Resistance: Capital lock-up for channels creates a cost-of-attack.

Advertisers pay for targeted attention. Random, sybil-generated clicks have zero value. Current Web2 models rely on invasive, centralized identity graphs.\n- No Proof-of-Human: Bots can farm unlimited fake attention.\n- No Reputation Graph: Cannot price attention based on user's historical value.\n- Privacy Trade-off: User data is extracted, not voluntarily attested.

Protocols like Worldcoin (proof-of-personhood) and Gitcoin Passport (sybil-resistant scoring) create verifiable identity layers. EAS (Ethereum Attestation Service) allows for portable reputation.\n- Costly Sybil Attack: Proof-of-personhood raises attack cost from $0 to >$10.\n- Portable Reputation: User's attention score is a composable asset.\n- Zero-Knowledge Proofs: Can prove reputation traits without revealing identity.

A user's attention spans multiple apps and chains. Value capture is siloed. A high-reputation user on Farcaster cannot port that value to a gaming app on Arbitrum.\n- Siloed Graphs: Reputation and payment history are not interoperable.\n- High Friction: Users must re-establish identity and payment channels per app.\n- Inefficient Pricing: Attention markets cannot form without a unified user graph.

Architectures like UniswapX and Across Protocol abstract settlement layers. Combined with EIP-7007 (ZK-proof of AI agent), they enable intent-based micropayments routed to the best execution layer.\n- Unified Liquidity: Payments pull from the cheapest/ fastest L2 or L1.\n- Reputation-Aware Routing: High-value users get prioritized settlement.\n- Composable Intents: "Pay 0.001 ETH if user watches 30s" becomes a portable contract.

Any reputation-based reward system is fundamentally vulnerable to Sybil attacks. Adversaries can create millions of fake identities to farm rewards, draining the incentive pool and destroying the system's economic viability. This is not a bug but a first-principles challenge for any decentralized attention economy.

• Cost of Attack: Often <$100 to spin up botnets.
• Defense Cost: Requires expensive, centralized, or privacy-invasive solutions like Proof of Humanity or Worldcoin.

Determining 'valuable attention' requires an oracle. This creates a central point of failure and censorship. Whether it's a centralized API like Google Analytics or a decentralized oracle network like Chainlink, the data source can be gamed, manipulated, or become a rent-seeking intermediary.

• Data Source Risk: Centralized oracles are a single point of failure.
• Manipulation Surface: Adversaries can spoof engagement metrics to extract value.

Even with near-zero fees on chains like Solana or Base, the economic model for true micropayments (<$0.01) is fragile. The gas cost to distribute rewards can eclipse the payment value. This makes the system viable only for aggregated batched payments, which reintroduces latency and centralization through batchers like EigenLayer or Arbitrum.

• Gas-to-Value Ratio: Can exceed 100% for sub-cent payments.
• Required Scale: Needs billions of events/day to justify infrastructure.

Building a persistent reputation graph is antithetical to privacy. Systems like Brave's BAT already face this tension. To prevent Sybil attacks, you need identity, which destroys pseudonymity. Zero-knowledge proofs (ZKPs) can help but add immense complexity and cost, making them impractical for high-frequency, low-value attention events.

• ZK Overhead: Adds ~100ms+ latency & $0.01+ cost per proof.
• Core Trade-off: You can have privacy or Sybil resistance, not both efficiently.

Paying users for engagement looks like an unregistered securities offering to regulators like the SEC. It creates a clear 'investment contract' expectation of profit from the efforts of others (the platform). This doomed projects like Kin. Compliance requires heavy KYC, destroying the permissionless ethos.

• Precedent: SEC vs. Kik Interactive set a clear precedent.
• Compliance Cost: Adds >30% overhead and centralization.

Even if it works, the model fails at scale. When attention becomes a directly tradable commodity, its value plummets due to infinite supply. This leads to a race to the bottom where users are paid pennies for their data, replicating the exploitative Web2 ad economy it aimed to replace. The market corrects to the cost of the cheapest bot farm, not human attention.

• Economic Law: Infinite supply → Zero marginal value.
• End State: Recreates Web2's $0.0001 CPM economics.

Current web2 models (e.g., Google Ads) aggregate attention for advertisers but offer users no direct, auditable compensation for their time and data.

• User Value Leakage: Users generate ~$100B+ in annual ad revenue but capture <5%.
• Reputation Silos: Engagement metrics are locked in proprietary platforms, preventing portable user capital.
• Trust Deficit: Advertisers pay for clicks, not proven engagement, leading to fraud and inefficiency.

Protocols like Rabbithole or Galxe demonstrate that verifiable on-chain actions can be tokenized. This reputation score can underwrite microcredit for attention.

• Unlocks Micro-Loans: A high attention-rep score could allow a user to "stream" content now, paying ~$0.001/sec, with settlement later.
• Reduces Friction: Eliminates prepayment requirements for services, enabling seamless pay-per-second models.
• Creates New Markets: Reputation becomes a tradable asset, allowing for underwriting and risk markets on platforms like Aave or Compound.

Micropayments require sub-cent fees and near-instant finality. This is only viable on high-throughput L2s like Starknet, zkSync, or Base, paired with intent architectures.

• Cost Mandate: Fees must be <$0.001 per transaction to be viable, a 100x reduction from Ethereum L1.
• Speed Mandate: Settlement must occur in ~1-2 seconds to match user attention spans.
• Architecture Shift: Systems like UniswapX and CowSwap show the power of intent-based, batchable transactions for efficiency.

Replace blunt monthly subscriptions with granular, value-aligned streaming payments. This mirrors the shift in DeFi from periodic rewards to real-time yield.

• Higher Yield for Creators: Capture value from highly engaged users paying $0.05/minute vs. a passive subscriber paying $10/month.
• Dynamic Pricing: Attention reputation allows for personalized rates, similar to risk-adjusted lending rates in DeFi.
• Protocol Revenue: A 1-5% fee on all attention streams creates a sustainable, high-volume fee engine for the underlying protocol.

Any system that rewards attention will be gamed. This is the core cryptographic and economic challenge.

• Sybil Resistance: Requires cost-effective attestation, potentially via World ID, BrightID, or proof-of-stake bonds.
• Oracle Problem: Measuring "attention" off-chain (e.g., active tab, mouse movement) requires secure oracles like Chainlink or Pyth.
• Economic Design: Reputation must decay with disuse and be expensive to fake, drawing lessons from Curve's veToken model and bonding curves.

The first killer vertical isn't entertainment—it's skill-based learning where attention directly correlates with outcomes.

• Proven Model: Platforms like Brilliant.org show users pay for interactive, paced learning.
• On-Chain Credentialing: Completion of a micro-course paying $0.01/step can mint a verifiable credential (e.g., OpenCerts).
• Investor Play: Back protocols building the staking/streaming middleware, not the content apps themselves. Look for teams integrating with Lens Protocol or Farcaster for distribution.