[vc_headings style="theme3" borderclr="#930014" title="(or last Christmas)" titlesize="30px" titleclr="#272727"]Can Amazon be replaced by decentralised applications?[/vc_headings]

Starting the moment a guest at a BlockChats event in September walked up to me and wished me a Merry Christmas, I have been constantly baffled by the efforts made in Manila to celebrate the holiday season. Just visiting the shopping centres, I am regularly blown away by the extensive plays of illumination, live piano jingles, and fir forests blocking the hallways.

No matter if you’re into this kind of kitsch or not – Christmas lights, gingerbread houses, bright-red stockings, and holiday discounts do draw the people to the malls. Christmas season is a season of carefree indulgence, and in many countries a silver lining on a horizon of abandoned shopping malls.

According to a 2017 article by the Guardian, around half of the 1,200 malls in the U.S. are expected to go out of business by 2023; Deutsche Welle anticipated the closure of about 10,000 retail shops in the UK by the end of this year. The numbers, while unsettling, don’t come as much of a surprise. We all know what’s behind these developments: we’ve got more convenient options now.

Why spend hours moping through the endless corridors of a noisy retail jungle, fighting your way through overfilled clothes racks, and squeezing onto slow-motion escalators, when you could stay in the comfort of your home and munch on popcorn while you browse through Amazon? Key in your search, read some reviews, place your order, happy days.

Or not?

As we set up the agenda for our upcoming Christmas event this 14th of December, we quickly realised that e-commerce as such hasn’t been a very prominent topic this far. Conferences and community get-togethers discuss the wildest applications of blockchain technology, but the purchase of goods with what’s in your crypto wallet, possibly the most direct use case of cryptocurrency after straight-forward value transfers, hasn’t been paid much attention.

Why is that?

Imagine yourself cuddled up in bed with a glass of milk and a plate of cookies on your lap when your dad comes inside with a flyer from a furniture shop. He tells you that you could go right now and get a state-of-the-art waterbed with a built-in massage function and a cup holder – all you need to do is get out of bed, get dressed, get out into the traffic, drive there…

You’re actually quite comfortable right now, so why bother?

Decentralised marketplaces come into today’s e-commerce a bit like Bitcoin would come into a world before any financial crises.

“Never change a winning team.”

E-Commerce as we know it ...

… hasn’t actually been around for too long and is still in the midst of disrupting the traditional retail industry; it’s a constantly evolving space in itself. It’s not just browsing the web, filling your virtual shopping basket, and waiting for delivery anymore. It’s not even swiping through your phone and using your stored credit card details to buy a new PlayStation in less than ten minutes anymore. If you are the lucky (or unlucky, depending on your stance) owner of an Alexa device, you can place orders on Amazon without moving a single finger – simply by commanding Alexa with your voice. Today, we have a variety of online shopping options, all catered to making our consumer lives as efficient, effortless, and intuitive as possible.

We are partners in crime when it comes to the creation of our profiles in the databases of service providers. Every time we visit an e-commerce platform, we deepen our relationship and let them further into our personal space. And they give back to us – targeted advertisements that prompt us to make more purchases, helping them get to know us even more.

So what's the problem?

The Transparent Human

In Germany, we may affectionately call the likes of Amazon, eBay, and Co. “Datenkraken” – I looked up the English translation but found that there doesn’t seem to be one. Actually, the literal translation is simply “data octopus”; a term coined in recent discussions about data protection and privacy.

We like to take shortcuts by nature, and we go with convenience when we can. The leaders in e-commerce provide us with the highest level of convenience in our shopping experience, taking it so far that we may not even have to search, may not even have to think anymore – Amazon is there for us and suggests what to buy for our mother for Christmas.

The ultimate trade-off? We pay the price – not just the product price, but the privacy price. Even then, no news here; this is a long-known fact to all of us.

 

We have a lot of things to worry about. So we don’t really worry about “data” used by “third parties” to send us “targeted ads”. Something we can’t touch, and something we don’t feel. It doesn’t affect us.

So we use the same password across the board – until the day that info is stolen, and with it our credit card details on the pages that didn’t do enough to encrypt our payment data.

We connect our Twitter to our Amazon account and log into our food delivery app with our Facebook profile, we cross-post our dinner photos and spread news we find interesting, and who knows, maybe the last article we shared was intentionally placed on our feed in an act of political manipulation. We’re lucky if a whistle-blower shows up and we find out.

Dystopian sci-fi movies draw the disturbing future of a world subdued by large corporations, but it’s just movies, right?

Do we lack the urgency to address the issue? Or do we simply not believe in a future of transparent humans?

Is that the only problem?

The Gatekeeper Fees

If you’re interested in buying my headphones and I agree to selling them to you, there’s no problem as long as we’re in the same location. We agree on the price, meet at a nearby café, I bring the headphones, you bring the money, you check the quality, I count the banknotes, we’re good to go.

As soon as we’re in different locations, however, it’s not that easy anymore. I need to send you my headphones, and you need to send me the money. What if you receive a damaged product, a different product, or no product at all? I could always say I sent the headphones as you requested them. Or what if I ship them, but you never transfer the money?

We have no way of verifying that everything goes according to our agreement – we have no way of trusting each other. So online marketplaces act as the mediator making sure that our trade goes smoothly. They’re not here for charity, so they take a fee. Ultimately, they can take whatever fee they like – and not seldom, they do exactly that. Because what do you do if not use their services? Change platforms? The outcome will be similar.

Opt out? Not really, unless you want to limit yourself to in-person purchases from now on.

While we as consumers might not really care that much for the fees (partly because we know we have no alternative), and even large retailers can absorb those extra costs, the ones that suffer are small vendors; the sellers of low volumes that have no access to cost-efficient, large-scale infrastructures. They effectively earn a significantly lower income from their sales.

Opt out? Not really, unless you want to limit yourself to selling your products to your neighbours from now on.

So where does cryptocurrency come in? What is a decentralised marketplace, and what is its proposal to fix the faults in existing e-commerce systems?

I am really happy with our panel for the upcoming event. We’ve got representatives from backgrounds in finance, technology, but also traditional e-commerce, and we will try to leverage their combined expertise to discuss not only the technical aspects, but also the social and ethical sides to the proposal of decentralised shopping.

How do decentralised marketplaces tackle the existing issues in today’s e-commerce, and where are their compromises in doing so?

What does trustless shopping mean?

What about the possibility of another Silk Road experience?

Join Manila’s Blockchain Christmas Fair this 14th of December at BlockchainSPACE in Makati to discuss with our panellists about the future of e-commerce and decentralised shopping and try out the real-life application of a decentralised marketplace, in between holiday jingles and loads of good food on our free onsite Christmas market.

To meet our panellists and read up on the event, click here, and to join the community on Telegram, click here.

 

Bye!

Lina

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The Founder
Lina

My name is Lina. Originally form the land of bread and beer and long confusing words, today I am a homeless tech evangelist, or digital nomad, whichever term you prefer.

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