Reputation Stock Market


In Accelerando, Charles Stross mentions as a side note that reputation is handled as a matter of course in the immediate pre-acceleration society, and specifically, that it is communicated by trusted servers and built up in the manner of a stock market, with, as he terms them, “goodwill dividends” from highly-rated reputations. People and companies can be traded on the same market, so the protagonist has a reputation traded above IBM.

Let us consider, then, what it would take to set up a reputation stock market on today’s Web, and its implications.

First, we need to have a concrete definition of the actors involved: identity. How to determine the contents of an online identity for an online reputation transaction is worthy of study in its own right, but let’s set it aside right now, and simply postulate that we will trade OpenID signifiers. This leads to one form of the Sybil question: how do we prevent people who dislike the reputation they’ve acquired from simply setting up a new identity and reinventing themselves? We don’t– but they’ll start out as new, of course, and this will negate many of the benefits. More on this a bit later. Note that this doesn’t mean we need to have a true name– an online presence can exist with or without full identity disclosure.

So now that we have people, let’s define value, before we go on to define money. One of the other Sybil questions is how to prevent a small but determined group of people– let us say for the sake of argument, 4chan– from creating many accounts to destroy the reputation of some group they find onerous. Since we want anyone to be able to participate without draconian identification requirements, we have to find a way to make the attack useless, rather than trying to prevent it, so let us define the value of a reputation to be the current number of shares outstanding of that reputation– that is, if five people own ten shares of a reputation apiece, the reputation value is 50. This way, new reputations start at 0 (well, 1, but we’ll get to that in a moment) and there is no “vote down” mechanism– only a vote upward, or a removal of one’s preexisting vote upward.

So now we have people and stocks– we need money. This, of course, is a tricky proposition on the Internet– lots of companies have tried, and ultimately failed, to create a useful virtual currency. (What we really need for this is a grounded virtual bank– to pull from another novel, we need Epiphyte Corporation.) We don’t have a good currency, though, so let’s just create a currency that works internally, and we’ll set up exchanges later, Linden Dollars-style.

Let’s combine all these elements, then, and outline the stock market. People start (in a state of nature– this isn’t that relevant to UX, but is how the simulation works, and we’ll get to UX momentarily) with no money, and one share of their own reputation. People gain money through dividends on stocks they own– say, 10% of the value of the stock, rounded down, per share, per time interval, so owning a share of a reputation valued at 100 will provide its owner 10 credits, and shares valued at less than 10 provide no dividends (as they are insufficiently notable to provide widespread “goodwill”).

People can buy shares of reputations whose owners are not yet themselves purchasing reputation shares, however, and so when a popular figure joins the service, he may find that as an owner of himself, he has amassed some credit simply through owning his own reputation.

The cost to buy and sell a share? The value of the share– so a stock valued at 100 will cost 100 credits to buy, and provide 100 credits if sold.

There are a few bootstrapping issues, naturally, but I think these are workable, so the system can work.

The advantage, then, is we get reputation free of context, which has all sorts of nice properties; I’ll go into a few of them in my next post.