Good morning from San Francisco!
Part of your editorial team (Ram) is currently at Blockchain Week in SFO, so Rohit will be mostly pinch hitting solo on the newsletter with support from Divyang.
What are Token Curated Registries?
The following post is a short summary on what Token Curated Registries (TCRs) are and why so many are excited about it.
In the digital world of the 21st century, data is likened to oil where 2.5 quintillion bytes of new data is being generated every day. The pace of creation is only going to increase as this digital universe keeps expanding, driven by the growth of Internet of Things (IoT). We use data-based lists to make crucial decisions almost every day in our lives. Yelp - to identify the top restaurants; Amazon - to see the most read and highly-rated books; various websites to know what the best colleges are. While some of these crowd-sourced and the others based on market research by specialised entities, a majority of these data lists are hosted by centralized companies.
Data repositories operated by third-party entities have some obvious challenges. The first and foremost is the trust factor, which involves a user trusting that the list is well-maintained, truly reflects popular opinion and with a fair ranking methodology. The power to include or exclude names from such lists rests solely with the operator. However, centralized operators are much more efficient at preventing spam, social engineering, etc.
TCRs can address this issue by allowing for distributed ownership of the lists, where tokens can be issued to the gatekeepers who look after the repositories, with the token designed to drive incentives to maintain high-quality, legitimate and popular lists. Any tokenholder who wants to add a new list member to the registry would go through a rigorous process of seeking approval through voting among tokenholders and would also stake some tokens, which would be lost if a majority of the tokenholders reject the application. This mechanism ensures that only applications that are genuine and legitimate get added to the lists.