Decentralized, the new Prefix for our 4th industrial disruptive innovations.
Today, we are moving towards a decentralized perspective to disrupt the existing systems in order to give more control and attention to the end-users, customers and the people in general. To provide total control on their funds, decentralized currencies, otherwise known as Cryptocurrencies was invented and the people become truly in charge of their livelihood. To make every vote count during elections and avoid rigging, decentralized voting on the blockchain was also invented which is used by some today. To increase privacy of information on the internet and avoid unprecedented cyberattacks, theft of personal data, a decentralized internet browser app among other was created e.g. Brave. To enable the ability to trust in the newly created decentralized world of trustless-trust system and create an environment where people can trust and trade without knowing one another, a decentralized marketplace was born for which there are quite a few.
What exactly does it really mean to say a system is “Decentralized”? Perhaps you’ve heard the phrase “without control, there will be chaos” or “Without government, the world will be chaotic”? These among some other well-constructed phrases backed with some real-life scenarios are what it took to create governance. Fear is the foundation of every government’ power and how it is run is control granted by the centralized system providing absolutism and indemnity in the event intentionally committed crime. When documents can be modified, deleted and publicly available information is what’s deemed required to be made public even in public matters by the centralized authorities, then the people are only what they deemed them to be. A decentralized system will be the opposite of this, a system where no one is in control, but everyone is. A system belonging to all, is truly given to all with no one deciding what stays and what doesn’t.
The blockchain technology in its definition isn’t complete without supporting terminologies such as transparency, immutability and of course ‘Decentralized’ features of a fully functional system of recording in a distributed ledger. To properly explain using a ‘Decentralized Marketplace’. Our usual online marketplace will be a type of e-commerce platform where multiple buyers have the opportunity of electronically meeting with multiple sellers to trade goods and services in a fashioned way. These transactions are processed by the market operator who of course has the liberty to request for and have access to several personal information of either the buyer and seller. The operator is also empowered with the ability to decide what is accepted and what isn’t. In these systems, the operator runs an imperfect system which needs to verify from the buyer’s bank and requires authorization to credit the account for the goods to be purchased and all these with extra costs to the buyer depending on the amount of intermediaries in the process.
Furthermore, the usual online marketplace gives the operator the responsibility to process all the consumer transaction and records the history in a ledger that’s centrally stored. Central storage and processing are at a disadvantage with demerits such the single point of attack leading to failure. Imagine a cyber-attack on the eCommerce site or online marketplace by the way, which will never be revealed to the users. Just imagine these platforms were attacked and private information of customers, such as banking details, delivery addresses, previous purchase history among others were obtained. Imagine, the threat the customers of these platform, buyers and sellers alike will face and the incredible losses they will suffer.
Finally, to state the obvious, most people look at the cheap prices to purchase and hence run after platforms with cheap products and most get duped. Even smarter ones look for reviews and ratings by previous customers before patronizing a buyer in order to protect themselves from fraud. Either way, what if the platform review is bugged or rigged with fake reviews to from fake accounts and purchases to deceive buyers into purchasing? All these are as a result of the centralized system which is not only prone to attack but also giving high avenue for the market operator either under undue influence by external factors or intentionally rigging the displayed information.
Now, let’s take all these negativities and turn it to our advantage, which is exactly the merits of decentralized over the aforementioned centralized marketplace. In summary, a decentralized marketplace utilizes the blockchain technology to provide security and privacy using distributed network of nodes and cryptography to encrypt and decrypt provided information that even when distributed can’t be read. Using the blockchain technology also allows the sellers to utilize a single platform to buy, sell, make and receive payments to complete the transaction while all private information remains in the possession of each parties and the shared information stays in the public shared and distributed ledger for all to see for eternity with no one possessing the ability to modify or remove. It’s a platform guided pre-written codes enabling automation of certain recurring activities and enforced by the connected nodes, governed by an inbuilt consensus algorithm without the need for a third party control.
In other words, a decentralized marketplace will be an online marketplace built on the blockchain platform utilizing its technology in full. With it, if your private keys are kept safe, your funds are safe, your private data is secured, your purchase history is verifiable and always available, the reputation system or provided reviews by previous valid customers are immutable and available for your to decide, reduced fees from reduced middlemen and you get the same opportunity as other buyers and sellers to participate in any trade. I first learnt of Decentralized marketplace from the Nxt and then the Ardor blockchain platform built since 2013 and then a host of others operating on a broader scale such as Open Bazaar for markets, bebee for freelance work sites, Steemit for content markets among others. Decentralization no doubt is here to stay and soon we will have more Dapps (Decentralized Applications) in the space decentralizing not just the marketplace but most of the publicly used platforms and systems.