According to Alibaba founder Jack Ma, “Blockchain technology could change our world more than people imagine.”
Michael Casey from MIT Digital Currency Initiative explains blockchain as a new method of record-keeping.
It is a decentralized system of many computers around the globe, that work in concert to produce a distributed ledger to keep a record of the blockchain marketplace transactions.
Transactions are verified through consensus — participants confirm changes with one another — and cryptography ensures the security of the information.
Blockchain helps to avoid the risks of relying on a single entity: potential breakdowns and hacking attacks.
Decentralization is a key to the technology and facilitates peer-to-peer exchange on the blockchain online platforms, which are also called decentralized marketplaces.
Advantages Of Blockchain Based Marketplace
A marketplace based on trust and security
On the blockchain, transactions can be seen and verified by members of a network and not only a few members. This open source operation brings in more transparency than when operating in centralized marketplaces. Furthermore, in order to ensure trust and security, transactions cannot be reversed since they are immutable. Immutability is an advantage for blockchain marketplaces because it reduces the instance of buyers claiming bad products and returning to the sellers. Immutability also means that one member of the network cannot change the data without other members of the network detecting. On the contrary, when using credit and bank transfers in the case of centralized online marketplaces, it is easy to reverse a transactions and change details which results in many incidences of fraud. The nature of blockchain cryptographic entries reduces and discourages fraudulence.
blockchain marketplace is built with community in mind. The essence of any blockchain based product is entrenching a sense of community. There is little interaction in the current marketplaces which are controlled by players such as Walmart, Amazon or even marketplaces such as eBay. Customers do not have the liberty to interact and explore different options in any way they deem fit. Furthermore, there is a lot of restrictions on how buyers and sellers can interact. Methods of payment are also limited because of the need for centralized verification and confirmation procedures. However, on the blockchain, the true essence of community is entrenched. Buyers and sellers are able to dictate the terms of engagement by themselves without the need for a third party. In essence, blockchain marketplaces create productive and active participation of all members without discrimination based on geographical location, level of income or any other methods of categorization. In case of conflicts, community-based conflict resolution mechanism are entrenched.
Another aspect is community management which means that all members of the blockchain marketplace have equal rights to participate in the affairs of the community. Most of these communities are run by consensus. There is a voting mechanism for allowing suggestions and those that have most suggestions are implemented. This is not possible in the current marketplaces whereby decisions are made by heads of corporations. Even if current marketplaces also implement changes and improvements blockchain based marketplaces are more community based and are not necessarily driven by profitability which is the case for current online marketplaces.
Cost advantage Blockchain Marketplace
blockchain based marketplaces have lower costs both for buyers and sellers. Existing online marketplaces leverage on payment gateways in order to facilitate payment process. Furthermore, there is a need for a protocol layer for the exchange of data such as TCP. Another requirement is a hosting platform such as AWS or any other cloud services. All these requirements add up to the cost of having an online marketplace based on software. However, on the blockchain, these processes are all compressed into one open ledger- the blockchain. Through a distributed ledger, it is possible for it to act both as a payment infrastructure, a protocol for exchange of value and a hosting platform. Therefore the costs of executing and running transactions on the platform are lower than the existing marketplaces.
Building a more connected network
The main rationale of a marketplace is to connect buyers and sellers. Therefore a marketplace operator should aim to reduce friction and thereby facilitating a smooth way to make transactions. This is archived through blockchain marketplace in various ways. One of them is by increasing the level of trust. Traditional marketplaces do this through reviews and having a trusted third party. However, blockchain marketplace is even better because there is no intermediary and the user reviews still remain. Furthermore, matching buyer and seller needs is better managed on the blockchain. This is achieved through building networks that are based on wants and needs.
My Work On ShopDrop
1. A simple interface with product adding option and details after the product addition.
2. We can add product name and can set the cost and then click on add product.
3. It ask you some etherum for adding the product in market.
4. After confirmation product will be added in the list and buy option enable in-front of the product by clicking on it you can buy the product.
5. After clicking on the buy button it will ask the set product value with some extra gas fees.
6. After buying the product the buy button disable with the buyer wallet address.
7. More improvement coming soon.
8. GitHub repositories of this project.(Coming Soon)
Special Thanks to Gregory.
Thank you. Stay tuned for more exciting projects.