Opera's Crypto-Wallet, and what it has to do with privacy.
Last week we learned that the popular browser, Opera, added support for a built-in Ethereum wallet. For those of you who are unfamiliar with Opera and Ethereum, we'll pause here for a brief explanation. Opera is a browser, just like the regular Chrome browser, but with some privacy enhancing features. The first is the built-in advertisement blocker, which is not perfect, but better than not having an ad-blocker at all; the second is the built-in VPN that allows you to browse the web with increased anonymity and to change your location and circumvent geo-blocking. What Opera also has is a sidebar with different messengers, so you can chat without leaving the browser. It also has an Ethereum based wallet.
Ethereum is a blockchain base computing network. It allows people to draft "smart contracts" (code, in Solidity) and to run them on an Ethereum Virtual Machine (EVM) so they can use the EVM for creating interesting calculations. One simple Ethereum contract could be voting on a decentralized decision making platform or could be something a bit simpler like a counter to count how many people paid a specific wallet. Other, more popular options are creating virtual pets or playing other turn based games. Ethereum, like bitcoin, is based on a wallet that has a private key and a public key. In a grossly negligent simplification, you can use the public key to view what tokens (outputs of contracts) are held by the wallet owner, and use the private key to move these tokes around.
Now, there are already some browser-based crypto-wallet implementations. The Brave Browser attempts to allow you to get rewards for browsing the web, and MetaMask is a Chrome extension that allows you to do use your Ethereum wallet as a part of the browsing process. HOWEVER.
The use of Ethereum based tokens and having access to them may help in replacing a huge (eh-yu-ej) hole we have in the internet as we know it: cookies. Cookies are a privacy issue. When you browse the web, each website you visit places a small file on your PC, called a "cookie"; so that it can identify you. Cookies are used so that you don't have to provide your username and password each time you submit a query on a page, and they are also used in advertising. When you visit a website, dozens of third party websites place cookies that have an identifier, a number that describes you, and they know that you visited this page. Later on, when you visit another page, they can deduce which pages you visited and show you relevant ads.
Now, we can replace the cookies with ERC777 tokens, in theory. We can have a modern browser that instead of storing cookies on your computer or phone, will send you a token. You can reject this token (block behavioral advertising) and you can accept it. When you want to migrate from one device to another, you just send your tokens. You can do the same if you just want to have multiple devices without losing your data.
ERC777 tokens as cookies allow storing of a data set, and allow us to also receive funds. Think of using an Ethereum wallet as your browser, where the website you visit wants to trade with you: your privacy for 25c. It can do so, it can send you a smart contract that says that as long as you hold the token for 30 days and visit at least 60 pages where its ads are shown, you get 25c. This is dead simple.
This only has one, simple, problem: transaction costs. Currently, the Ethereum network is crowded and using it for these kind of transactions may block the web and will require a heft amount of money. This, however, is not a problem, but a feature. This means that in order to place a cookie, an advertiser will have to pay some funds, unlike the current "free" model. This also means that in transactions that have no economical value, the ERC777 token/cookie won't be placed.