The Cryptocurrency Open Source API Marketplace for Developers

The API economy is the reality we live in and it’s an enormous one that, once the Internet of Things kicks into full gear, will feature an infinite number of API calls a day. But as we globalize, the world and the products—in this case APIs—we sell in it become more complicated and often more expensive as we factor in all the friction of exchange rates and credit card micropayments. It’s in everybody’s interest to smooth over that friction so developers can access our APIs or application programming interfaces more easily.

To achieve that could require a change in the way we handle API monetization; something that should be done now before the API economy blows up more than ever before.

The API Network is an open-source project created to provide a universal mechanism for querying APIs by infusing the API economy with a new cryptocurrency called APICoin. The lofty objective is a win-win situation where providers that offer more value to the API community are rewarded, while allowing developers to access APIs much more easily, by removing these points of friction.

The hope is that intersection of the API economy and this new APICoin cryptocurrency will allow the API economy to grow faster than ever imagined before.

The Reverse Apple App Store Model

The API Network looks to become a new incentivized API marketplace that “allows us to really radically change the way today’s models work with API monetization,” said David Johnston at his APIcon Innovation Showcase (see the full video at the end of the article). It looks to turn the mainstream app store model upside down in a laissez-faire way.

“Instead of the developer paying 30 percent of their revenue for the pleasure of being in the app store, we can actually reward developers with APIcoins for joining an API network. So, in the sense, we are paying developers directly for the APIs that they add in proportion to how popular and how used their API is,” Johnston explained.

The API Network automatically rewards API providers for providing APIs on the network. API providers earn coins based on the the number of times the provider’s API is called by users on the APICoin system.

“It sort of flips the existing model on its head and rewards those that are actually creating the value in these systems,” he said.

Remove Payment Friction from a Renewed API Economy

“It’s really difficult to do micro-payments and to really open up your API for small users because there’s so much friction in the payment system here: you’re paying the card company, you’re going to have to collect a lot of data,” Johnston said.

Cryptocurrencies don’t work with processing fees and the API Network doesn’t charge a commission to be on it but instead it is a completely open source project that works with Gmail, AOL, Yahoo and Outlook via IMAP.

“This is really acting in a way where it aligns incentives because API providers are earning this native currency, they are essentially gaining a stake in the API Network because the value of the coin is highly correlated to the usage of the coin.”

This is also a situation where API providers create a sort of APIs Without Borders, a community that uses it’s own unique currency that fluctuates solely based on market demand.

“In order to send Bitcoin across the Bitcoin network, if I wanted to send remittance from the developed world to the developing world, I’d have to buy Bitcoin to do that. Well in the same sense, the coin is connected to the API network. In order to purchase the API, I have the buy API coins.”

This effectively aligns the people who are building the network and adding value to it with the value of the coin itself, which gains more worth as the network grows.

Johnston says that, like the dominant form of cryptocurrency, Bitcoin, “The beautiful thing here is that there’s no central entity trying to take a profit margin off the top,” eliminating credit card fees and the more egregious app store percentages.

No Hoops to Jump Through to Join

Anyone can build an API in this network with a simple web form needed to be filled out. There is no permission required or authorization process.

“People can use this freely and build whatever they want on top of it,” Johnston said.

Now, if there are no barriers to entry, that means lower quality APIs can also join, however the assumption is— like in the rarely witnessed pure capitalism— the higher quality will win out over the crap, solely based on market demand.

He also believes that this opens the market up to more niche APIs, “where today there isn’t a big enough market but if you offer these incentives, we think it’ll let people monetize the APIs they are building. So hopefully this will build a really rich ecosystem and a diversity that we don’t have yet today.”

But that doesn’t mean that the the API Network is just a niche community for obscure and small APIs. Johnston pointed to how some of the first APIs added to the network a year ago were some of the big ones like Twitter and Facebook.

The team here at ProgrammableWeb still uses the good old U.S. dollar to pay our staff, but we’re definitely interested in seeing how the world will accept APICoin and the whole cryptocurrency movement.

Have you tried the API Network? What about any other cryptocurrencies for your own API monetization? Tell us about it below!

Be sure to read the next Cryptocurrency article: Airbitz Opens Bitcoin Wallet Plugin API to Entire User Base