OpenBazaar: The Future of Free Markets?

--“Before the Internet,” Muneeb Ali, co-founder of Onename, writes on his blog, “there was Usenet — the world’s first and largest community.

“Anyone could run their own server, connect to other computers (over dial-up!) and start receiving/sending messages. No one controlled Usenet. It was organic.

“It attracted creative souls to it like a magnet. As long as you could connect to a single Usenet server, you could get access to exciting new world of information — like lighting up a candle from another.”

A decade after the Usenet popped up, the World Wide Web showed up.

And, says Ali, this newfangled Web came with another perk: “anyone could host a website on their own server and buy a DNA domain to point to it. These websites would then link to each other, creating a decentralized web on information. For real-time communication, there was IRC. No centralized company owned this communication medium. You could run your own IRC server if you wanted or join public servers and join chat rooms around interest like #freebsd. Yes, the original hashtag.”

That’s right. The original internet was completely decentralized — user to user.

It was born wild.

But in the race to bring the power of the Internet into more and more hands, convenience overpowered decentralization.

Which means, of course, decentralization was put on hold and centralized services became the name of the game. But, of course, that doesn’t mean that centralized services have become the “status quo.”

Centralization of the e-economy will end as soon as decentralization becomes convenient.

--Enter what’s called OpenBazaar.

OpenBazaar

“OpenBazaar,” the platform’s website explains, “is an open source project to create a decentralized network for peer-to-peer commerce online — using Bitcoin — that has no fees and no restrictions.”

OpenBazaar works in the same way Usenet worked. It simply allows user to connect directly through it. Rather than meet and transact in a roundabout fashion, they use it as an invisible intermediary.

There are obvious benefits to a marketplace without fees or restrictions. One that’s consumer-to-consumer. No middleman. And, even better, one that’s censorship-resistant and private.

First and foremost, it would shake up the established order.

As mentioned, the large platforms of today hold most of the e-commerce clout (and take a good chunk of the money).Worse, they also restrict what you can and cannot do and set fees for listing and selling goods and per transaction.

Moreover, the big players are far more invasive and restrictive than is necessary: “They require personal information, which can lead to it being stolen or even sold to others,” OpenBazaar explains. “Buyers and sellers aren’t always free to exchange goods and services with each other, as companies restrict entire categories of trade.”

So why is OpenBazaar a good alternative? Simple. To summarize: “Instead of buyers and sellers going through a centralized service, OpenBazaar connects them directly. Because there is no one in the middle of your transactions there are no fees, no restrictions, no accounts to create, and you only reveal the personal information that you choose.”

Future of Free Markets

The future of free markets?

OpenBazaar isn’t quite ready for primetime. But it’s getting close. As of the first of March, in fact, it opened its virtual gates for testers.

--If you’re interested in becoming one, testers are given “testnet” coins (valueless bits) which allow them to “paper” transact on the platform.

The tester’s job is to go in, tap a few pipes, flush a few toilets…

You know, make sure everything’s accommodating. (We’ll show you how to become a tester in a moment.)

Once OpenBazaar is up and running its users will enjoy:

    • (Virtually) Free Virtual Real Estate and Third-Party Protection: OpenBazaar itself is free to use. You can list as many products as you want to sell directly and freely to the consumer. All sellers might pay is a small arbitration fee. Optional, but smart. OpenBazaar users have the option of using what are called “multisignature escrow addresses” to help manage the risk of anonymous transactions. Meaning, you hire a third-party notary (one that is part of a competing pool of solid reputations) to act as the third signer.

 

    • A Marketplace Built Solely on Reputation and Quality of Service: The open market naturally lifts those who provide superior products and services — and doesn’t deal in special favors, cronyism or subsidization. Because it can’t.

 

    • Ability to Adapt to the Market: OpenBazaar’s open nature will quickly adapt to quell any reservations from potential merchants. This would include, says OpenBazaar, “providing additional services to them, such as very professional moderation services, identity vetting, things that maybe more serious merchants would need in order to take OpenBazaar more seriously.”

 

  • The Peace of Nations: “The possible scale of OpenBazaar,” co-founder Angel Leon tells Bitcoin Magazine, “will bring e-commerce to countries that still not have experienced what these traditional marketplaces have brought to industrialized nations. Hundreds of millions of people in Latin America will be able to trade locally and internationally, the same for every other country, bringing in job creation and a more competitive and globalized market place. I’m a strong believer that commerce brings peace among nations. Now everyone on the street, on every city and every country will be a potential trading partner on the network. I think we’ll truly help make the world a better place.”

Since OpenBazaar is 100% open-sourced, it could scale as quickly as the market wants it to.

“Once the protocol is out there,” one of OpenBazaar’s angel investors, William Mougayar, tells Business Insider, “it’s going to be in the wild; unstoppable like Ethereum. I mean who owns the network now?  Everybody and nobody. The network is in the wild.”

[Note: Ethereum, if you don’t know, is a decentralized “smart contract” platform which allows users to create and issue their own cryptocurrencies, kickstart projects, create “democratic autonomous organizations” through automated transparent voting mechanisms, build a decentralized mobile app, and more.]

--We admit, as you may’ve guessed already, to become a tester of OpenBazaar takes a little technical skills.

Fortunately, they’ve written up a tutorial, if you’re feeling adventurous: [Find it here.]

OpenBazaar Beta Tutorial

Only time will tell if the collision of decentralized markets, cryptocurrencies and the blockchain bears fruit.

We’ll keep an eye on the trend.

Next week, though, we’re going to switch gears. And talk about something that’s been bugging us.

More on that, though, next week.

Until then,

Chris Campbell
Managing editor, Laissez Faire Today

P.S. Have something to say? Say it! Chris@lfb.org.

The post OpenBazaar: The Future of Free Markets? appeared first on Laissez Faire.