Important Changes to Brave Rewards-What’s changing for Users?

 

To begin earning and accruing BAT for Brave Ads, you will need to connect a custodial account to your Brave Rewards profile with upcoming version 1.48. Brave currently works with three custodial account provider partners: Gemini, Uphold, and bitFlyer in Japan. Requiring a custodial account gives us a place to send you your BAT earnings, and allows us to eliminate our centralized “virtual BAT” system (see “Sunsetting virtual BAT” below for more).

If you’d just like to support creators as part of a more private Web, you can do so without ever connecting a custodial account by opting into Brave Rewards and using the new “creator support only” experience. A share of the ad revenue will be earmarked for creators and distributed by Brave as part of the monthly payout to verified creators. If you want to give more, connecting a custodial account will allow you to use BAT you’ve purchased elsewhere to support creators in the Brave Rewards ecosystem, and will also unlock the Tips feature.

The new “creator support only” Rewards experience without a connected custodial account

What it looks like when you start to connect a custodial account 

Sunsetting virtual BAT

After these changes to Brave Rewards in 1.48.x, we will also be sunsetting our centralized “virtual BAT” (“vBAT”) system, used primarily for unverified users.

What is vBAT?

When you use Brave Rewards without a custodial account connected, the earnings you accrue are in something called “vBAT” (virtual BAT). vBAT isn’t BAT on the blockchain; instead, it’s a centralized point system backed by a Chaumian blind signature “ecash” scheme. These points can be contributed to creators or redeemed for BAT if and when you connect a custodial account. 

For example, let’s say you are an unverified user and have “5 BAT” in your Brave Rewards balance after claiming your Brave Ads earnings. That “5 BAT” is actually vBAT, stored as cryptographically signed certificates on your device. When you “verify” your Brave Rewards profile by connecting a custodial account, your device submits those 5 vBAT certificates to our servers. From there, our servers utilize the APIs of our licensed custodial partners to deposit 5 BAT into your custodial account.  

When is vBAT going away?

At the earliest, vBAT will go away sometime in April 2023. However, we want to ensure users have time to adjust to this change, so we will share more exact dates soon. With 1.48.x, existing users without a custodial account connected will receive a final vBAT payout for any February earnings in March.

Once the sunset deadline for vBAT is reached, vBAT will no longer be considered valid, and will be removed from the Brave Rewards experience. This means that even if you’re on an old version of Brave that still shows a vBAT balance, that vBAT can no longer be redeemed after the deadline. 

As the vBAT sunset deadline draws nearer, unverified/non-connected users will see messages with more information and a specific date:

vBAT deadline messaging for users without a connected custodial account

Users in unsupported regions

Although our goal is to maximize the number of supported countries for connecting a custodial account to Brave Rewards before sunsetting vBAT, the unfortunate reality is that there will still be some countries without an available custodial option. For example, Germany is currently not serviced by any of our custodial partners, and will likely not become supported before the vBAT sunset deadline. In other cases, some serviced regions are impossible for us or our custodial partners to support due to unsustainable economics. You can find a list of these unserviced or unsupported countries here.

If you’re in an unsupported country, you will still have the option to contribute your vBAT balances to verified creators you’d like to support, and will see messages like this:

vBAT deadline messaging for users in regions with no available custodial option

We understand that this may be frustrating for users in unsupported regions, and we apologize for these circumstances. We will continue to work with both existing and potential new custodial partners to maximize regional support for Brave Rewards as feasible. 

Why is vBAT being removed?

First, vBAT was never intended to serve as a long-term store of BAT. A core assumption in our early Brave Ads abuse modeling was that vBAT would expire in order to prevent bad actors from accumulating funds across a large number of profiles, then simply waiting for an illicit avenue to open up to drain these funds out of the system. Although vBAT was originally planned to have a rolling expiry, we instead delayed it as long as possible to minimize the impact on users. 

Second, because vBAT is stored locally on users’ devices after it is issued, it is impossible to tell whether some vBAT has been lost to a discarded device, abandoned upon Brave uninstall, or lost due to profile deletion, undermining the possibility of transparent and accurate accounting within the platform. 

Now, with the removal of the legacy unverified user state and the introduction of the new “creator support only” experience, vBAT is no longer necessary. Removing the centralized vBAT system will allow us to focus our efforts on building a more transparent and decentralized future for Brave Rewards.

Decentralization after vBAT

We’ve already shared details about our research on decentralizing the Brave Ads system in Brave Rewards through initiatives like THEMIS. Eliminating our centralized vBAT system represents another step in this direction. For example, in place of vBAT contributions accounted for in our centralized vBAT system, users will, in the future, be able to send on-chain BAT directly from their self-custody Brave Wallet (or other Web3 wallets, such as MetaMask) to creators’ Web3 addresses, including Ethereum, Solana, and others. We’d also like to allow users to purchase products—such as Brave Firewall + VPN, Brave Talk Premium, etc.—with on-chain BAT. 

In a similar vein, many users have asked whether—instead of having to connect a custodial account—it will be possible to connect Brave Wallet directly to Brave Rewards, and receive BAT payouts directly to one’s Brave Wallet addresses. This is a future we’d welcome and are continuing to explore. However, in order to comply with current financial regulations (such as FinCEN and OFAC requirements, or equivalent regulators outside the United States), payouts at this time must first go through a regulated custodian. 

Note that once you receive BAT into your custodial account, you can always withdraw it on-chain to your Brave Wallet. In the future, we plan to bring Brave Rewards and Brave Wallet closer together to form a more unified user experience. More details to come.