ProTip Attempts To Redefine Internet Tipping With Bitcoin Micropayments

Voluntary tipping on the internet has been both praised and berated as a way to monetize websites and online content. When a comedian, artist, or any content producer puts their content online for free with an optional ‘tip jar’ application on the page beside it, they can expect a very small income from that, typically an order of magnitude less than any traditional revenue stream.

The latest solution to this problem is the brainchild of developers Leo Campbell and Chris Ellis. Named ProTip, the open source Chrome browser plugin attacks the problem with tip jars from a different direction.

Instead of the webmaster holding out the hat, ProTip is a special bitcoin wallet that lets web surfers produce their own hat on their own time, and tip all their favorite webmasters in a batch run, quickly and efficiently, without any messing around with individual payments.

This approach has many benefits that other tipping platforms haven’t tried before, and it mostly bypasses the serious issue of merchant adoption. As long as a merchant accepts bitcoin in some way, and has a bitcoin address somewhere on their website (even in a Meta tag) then ProTip can detect it and use it to tip that webmaster, once or ongoing, even if they weren’t asking for tips at all.

“Merchant acquisition is the hardest part about making a payments platform.”
— – Ivan Kirigin, Former Tipjoy CEO

Although there have been similar attempts to process tips in this fashion, ProTip offers a  surprising level of functionality to those who wish to support the content providers they visit.

ProTip is the first tipping platform to be able to tip artists on just about any platform. YouTube, Soundcloud, WordPress, Tumblr, Twitter, Deviant Art, Flickr, and many more provide a place for a bitcoin address to be displayed, such as an ‘about the artist’ field.

The app has a built-in bitcoin wallet that lets you choose if you want to pay out to all of your favorite sites automatically, on a schedule, or whenever you hit the green button. It also gives you control over how much you send to each site, or lets you base your tip amount on the time you’ve spent with them, even giving you the decision of which tipping structure is fair, per site, when tipping in bulk.

Once you have the ProTip plugin installed the app automatically adds the Bitcoin address from pages to a list. You literally don’t have to even think about this part, but it does take a little effort later to tidy up the list. Thankfully, they included an ignore filter that stops the app from collecting certain bitcoin addresses, or any address from specific websites.

Overall, the effect is pretty magical; a single place in your browser that automatically keeps up with all of your favorite websites’ tipping addresses, for use as a subscription service, or for a single tip blast.

Conveniently, each link on the apps list of sites also acts as a bookmark, keeping all of your favorite sites just one click away. Further inside the app, you can even see how much time you’ve spent on each site that week, so you can assess each site for spending your tipping budget.

“The tip is based on the time they spend enjoying your work.”
— – ProTip

From there the wallet lets you set reminders, plan your budget further, toggle it from automatic to manual mode, and even use the fully-functional bitcoin wallet, although the security for it shouldn’t be trusted for large amounts.

Perhaps the largest criticism of the plugin is its’ learning curve. If this app is meant to help bring more users to Bitcoin, it still needs a bit of polishing. Although it’s easy enough to install from the Chrome Apps store, the first thing it shows new users is their private key.

There isn’t much information about how important that key is, or instructions on how to keep it safe. A careful walk-through could ease new users into bitcoin better.

Another concern is the reasonable expectation that the list of websites may become too long, and the costs too large for anyone to keep on top of their tipping schedule indefinitely. If you wanted to tip your favorite websites a dollar each, and you visit a few dozen over a period of time, that adds up pretty quick, the thought of which could scare off users before they even download the app.

Thankfully, Bitcoin micropayments allow for far smaller tips. If ProTip’s seemingly-backwards model of tipping many websites all at once on a schedule catches on, far more people will be tipping far more sites, but with tiny amounts. This would still make it worthwhile for webmasters in the long run.

Instead of a popular website charging subscription fees through paywalls, or using payment processors that charge fees, tippers could support their favourite sites with fractions of a dollar.

After crowdfunding the app themselves, running an Indiegogo fundraising campaign earlier this year, the programming duo managed to raise enough money, mostly in bitcoin, to produce the working version that launched on Monday. Now the challenge will be convincing the world that content has value, and allowing the tippers to decide how much, not the content producers.

Of course, there is some competition, of sorts. The internet already has more than a few online tipping services, including ChangeTip, Patreon, and Flattr.

"ProTip is peer to peer crowd funding. We’re big fans of Patreon and Flattr, but we feel the commissions are too high and you are locked in to the platform."
— – ProTip

Why not just use Flattr or ChangeTip for bitcoin tipping you might ask? First of all, neither does subscriptions. These services are just one-time-only appreciation engines, usually meant for tipping other commenters on 3rd-party websites where no bitcoin address is given for that commenter. Their systems also rely on tippees being members of the same tipping system in order to receive their tips, creating closed communities.

A more fundamental difference between the two services and ProTip is that the latter has no company behind it at all, much like bitcoin, and operates only as an open source software in your browser.

Patreon is perhaps the closest service to ProTip, and although centralized, it has a similar subscription model, which allows web surfers to pledge an amount no smaller than $1 per week to a site or content producer. Patreon only deals in dollars, with no option for bitcoin, but the amount of traffic Patreon has achieved impressive.

According to Gigaom Research, by the start of 2014 Patreon tippers were already tipping over US$150,000 per week. The company hasn’t released any more recent stats, but the growth trend was looking exceptional.

Perhaps the primary reason that voluntary website tipping hasn’t caught on is because we internet users feel entitled. We have been getting content like this online for free already, so why pay anything?

If we had been paying for that type of content all along, like we do with newly-released Hollywood movies, then our expectations would be quite different.

“Monetizing content that people don’t currently pay for, [makes] it really hard to succeed.”
— – Ivan Kirigin

Kirigin, the former CEO of a ycombinator tip-jar startup named Tipjoy, saw this problem first hand. It was the reason he decided to shut down Tipjoy, and he has since moved on to work for Dropbox. Kirigin remains convinced that tipping isn’t a viable revenue model.

ProTip’s solution to Kirigin’s problem is a unique proposition, giving 100% of the power to the tipper, automating the address collection and payout scheduling, and depending on Bitcoin for the hard parts. This allows ProTip to simply make tipping far easier to do at scale, and perhaps more worthwhile.