Last month, Airbnb CEO Brian Chesky took to Twitter to ask people what Airbnb should launch in 2017.
One of the top suggestions was for Airbnb to start accepting payments in bitcoin.
— Stephen Cole (@sthenc) 26 December 2016
Thanks for the 2,000 submissions. Most popular: Bitcoin, Guest Loyalty, upgraded homes & services, group travel, things to do, and Mars https://t.co/DbrBSTDlCl
— Brian Chesky (@bchesky) 30 December 2016
I think it’s a great fit. People that are likely to choose one “digital” solution are also more likely to use another. The big question is of course: Will we see it happen this year?
How else could a blockchain be used?
Unsurprisingly, among the discussions about this news, there were some people that suggested we should take things a step further and decentralize Airbnb on a blockchain.
— Matt Liston (@malloc8) 26 December 2016
This once again emphasized the problem I have with Ethereum. As a speaker on Bitcoin and Blockchains, people sometimes ask me why I don’t talk about Ethereum more, which is the second biggest blockchain by market cap. It’s because I remain unconvinced of the problems Ethereum solves for the foreseeable future. (Please prove me wrong though)
Ethereum aims to be “the world computer”, by providing a platform for decentralized applications and smart contracts. Putting apps on decentralized networks would be great…IF the cloud hosting industry was an overly expensive oligopoly, with a lot of downtime and censorship for those using it. Instead, it is a highly competitive market that is getting cheaper and more reliable year after year.
Decentralizing control of Airbnb, Uber… by using smart contracts, also does not solve a problem in my eyes. It would probably create them, considering the complexity involved.
Yes, this would cut out the 6-12% cut Airbnb takes on bookings, but customers are already saving a lot of money by using Airbnb. We also love that we can fall back on a company when we are travelling abroad and things go sour.
Don’t decentralize for the sake of it
The main investment firm in the cryptocurrency & blockchain space, Digital Currency Group, seems to think the same way about decentralization for the sake of it. (and reminded me that I still wanted to write this article!)
“Our view is decentralizing a company or an idea for the fact of decentralization does not necessarily solve a real problem,” said Silbert. “Although, we haven’t seen everything, so maybe there is a decentralized project out there with merit.
“We’ve essentially looked at every Ethereum company looking to raise capital in a traditional way, and we’ve passed on all of them,” added Silbert.
In my eyes the real killer solution that cryptography could bring to Airbnb and the whole “sharing economy”, is transferrable reputation. I initially hoped this was the reason Airbnb acquired the ChangeTip team, considering their experience in cryptography and integration with various platforms.
With transferrable reputation, I mean the ability to transfer the trustworthy reputation that you built up on one service, to others, so you can get started there quicker.
If you’re a new host on Airbnb without any reviews, it can be hard to get your first booking even though you’re verified. However, if you can prove that you’ve been buying and selling on eBay for years and have dozens of reviews, if you can prove that you’ve been helping your neighborhood out through TaskRabbit or that you’ve been providing services through Fiverr, to name a few, then this could give you a reputation boost to get started.
Creating an ecosystem of businesses
There is a major win for all sharing economy businesses to get on board with a model like this, as they are all up against the incumbents in their own industries. Like I said in the beginning of the post, people that are likely to choose one digital solution, are also more likely to use another.
If users carry the effort they’ve put into a platform with them through one shared identity, then they have even more of a reason to stay on-board of this ecosystem.
Ideally, this identity would be fully controlled by the user and not by a centralized, vulnerable intermediary. After all, we’re doing things in radical new ways here. To do this, we would need to use a blockchain.
Like everything in crypto-land, there is a trade-off though. Digital-first businesses are all about our data and users being in control could challenge that if they become less willing to give up their information. I personally believe that if these businesses continue to be as transparent as they have been, it’ll all be fine, but perhaps that’s naïve.
A universal, user-controlled digital identity is a long shot, but worth it for all of us. I’m interested to see how this will play out!
Want to learn more about blockchains and Bitcoin? Get in touch!
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