Blockchains problem solving powers
From March 9th through 18th the 2018’s edition of South by Southwest attracted 300,000 people to Austin, Texas. Luckily for me, I was one of the fortunate ones. During my week at the conference I explored a broad range of hot topics which currently dominate the tech and creative industries. Of course, it goes without saying that blockchain was a huge (arguably the number one) topic at SXSW. For many, blockchain technology is still hard to grasp. Examples of how blockchain is currently applied in an attempt to solve real world problems can help people understand the possibilities of this technology. Let me share my thoughts on two types of blockchain initiatives. I’ll start with two initiatives for digital marketplaces for work, followed by an initiative for the entertainment event ticketing industry. Without going into details how blockchain technically works.
Democratization of work, all over the world
The rise of freelancing and digital marketplaces for work
While in most Western countries full-time company-based work is still the standard for employment, the number of freelance workers worldwide is on the rise. According to Forbes the majority of U.S. workers will be freelancing by 2027. A whole new economy has taken shape wherein freelancers combine several jobs by utilizing rapidly growing digital job marketplaces of the new “Gig Economy” like Uber, Deliveroo, Fiverr and Upwork.
Millions of workers in less developed economies sign up for micro tasks marketplaces like Crowdflower and Amazon Mechanical Turk. Compared to freelancers, this type of workers are probably in search of an income instead of desired freedom or flexibility. These marketplaces list small jobs (tasks) in order to assist machine learning and AI systems or other tasks which computers aren’t capable of yet. For example, discovering addresses with a swimming pool for an swimming pool manufacturer, by looking at aerial photos.
In general both these freelance job and micro task marketplaces are quite dominant, while there are some major drawbacks for workers like low payments and minimal or non-existing employer-sponsored benefits such as healthcare. Maybe blockchain can empower freelance workers all over the world? There are several blockchain initiatives created by founders who would like to change the way work is supplied by employers and accepted and processed by workers. I’ll highlight two of these initiatives.
Ethearnal is trying to disrupt the freelance job economy
Ethearnal is trying to disrupt the market in the freelance jobs domain, by applying blockchain technology for translating the reputation of freelancers and employers into tokens and for payments for completed jobs. In my opinion, you can debate on the level of professionalism of Ethearnal’s marketing materials and whitepaper, but the paper shows some really great ideas. According to the whitepaper, Ethearnal is the first blockchain project to attempt to represent freelancers and employers reputations by tokens. This makes sense, because reputation is the most valuable asset in the freelance economy. Freelancers can buy or earn tokens to get better jobs, employers need tokens to put in a stake when creating job listings. This way, all parties are always incentivized to act honorably because being on the losing side of a dispute means loss of tokens and therefore money.
Gems is trying to disrupt the micro tasks market
What about the micro tasks marketplaces? According to Gems, a new decentralized blockchain platform, the current industry leading platforms are immensely overpaid, while the freelance micro task workers are paid way too little. Gems is trying to create an honest model which also works for the micro task workers around the world, it’s currently in alpha.
At Crowdflower and Amazon Mechanical Turk micro job employers rely on redundancy to form a consensus about the quality of the done job, oftentimes having 5-15 workers perform the same task. This results in employers paying 5-15x as much per job, and workers losing out on a potential increase in payment. The usage of blockchain technology should result in a substantial efficiency increase by including and paying veteran workers for quality assurance, a win-win-win solution.
Cryptocurrency payments for the creation an inclusive, worldwide payment system
To me, the biggest advantage of Ethearnal and Gems is how the worker gets paid. After a job well done, both platforms pay instantly via cryptocurrency payments. No delays (even across international borders) instead of late or no payment at all, no fees from intermediary payment providers, no hassle with multiple currencies. And workers who don’t have access to a bank account (a staggering 39% of the world population) can join in and get paid via cryptocurrency payments. These platforms could create an inclusive, worldwide platform for freelance work, big and small. It seems to me that this is quite a beautiful forecast.
Eliminating ticketing fraude and disgraceful secondary market prices
On to the second part, blockchain and the entertainment event ticketing industry. Of course, as a Dutchman at SXSW, I visited the New Dutch Wave movement where an event ticketing solution, called GUTS Tickets won the startup pitch competition.
Ticket fraud and exorbitant secondary ticket prices are age old phenomena that have had artists and their fans worried for years. According to the GUTS whitepaper, thirty percent of all tickets in the entertainment event industry are resold with markups between 30% and 700%. The market is known to be non-transparent, with ticketing services adding inexplicable transaction costs to tickets. GUTS has introduced a blockchain based platform which will make exorbitant secondary market ticket prices and ticket fraud occurrences of the past.
A blockchain powered smart ticket with dynamic QR-code.
The authenticity of a regular event ticket is determined by ink printed onto a piece of paper or through an image in a PDF file, which makes ticket fraud as easy as taking a screenshot or operating a copier. The smarts tickets which GUTS issues are actually quite smart. The QR-code on the ticket remains hidden leading up to the event, which makes reselling the ticket outside of the GUTS platform impossible. The user-specific and dynamic QR-code appears just before the event starts. Once scanned at the entrance the code disappears, preventing last minute reselling of the ticket.
Buyers of a ticket get their smart tickets issued to a personal wallet linked to their mobile telephone number. Smart tickets can be resold anonymously, but it can only do so according to the in the GUTS blockchain technology set price restricting rules. This eliminates the possibility of making profit by increasing the price of a ticket.
Just a few days ago there were questions about outrageous ticket prices for the upcoming Beyonce and Jay-Z concert in Amsterdam. GUTS Tickets could be the solution.
A positive outlook
On different levels Ethearnal, Gems and GUTS Tickets try to solve one or more real world problems by applying blockchain technology. Time will tell if these initiatives are successful at their mission. In the meanwhile I’m excited about all the possibilities blockchain provides us with. Let’s make the most of it!