For those who don’t recall, OpenBazaar is a decentralized peer-to-peer marketplace where items or services are traded for Bitcoin and recently, lead developer Brian Hoffman went on This Week in Startups to talk in depth about the project, what their goal is and the kind of customer base they’re looking to attract, below are some of the highlights of the hour-long conversation:
“Our initial market is the kind of consumer-to-consumer market, so it is the people selling on eBay and Etsy and doing the homemade goods . . . I think the last time I saw there was a satisfaction survey for eBay 79% of people were happy. So that’s a huge number of people that are unhappy selling on eBay. This is a perfect opportunity for them to go and do something for no fees.”
On the topic of fees, OpenBazaar doesn’t include any since the marketplace doesn’t employ middlemen:
“I think average take is about 6 to 10 percent of every sale. A lot of these depend on the category and stuff like that, but that’s a pretty good chunk. You’ll notice that the prices are more expensive because of that; because they bake it into the cost.”
About the reputation system:
“The key piece here is that [added buyer or seller protections are] optional though. In eBay and PayPal, a lot of that is subsidized through the fees, right? So everybody has to pay for it. I could have a thousand great transactions — no problems — and I still have to spend 10 to 12 percent take rate to those companies. For what? That’s a lot of money for huge vendors that don’t have issues.”
On whether the underlying technology could be repurposed to potentially create a decentralized version of Reddit:
“I think that the underlying technologies that we’re building can be repurposed for that kind of thing. Reputation, identity, ratings, reviews; those are the kinds of things that kind of makeup what Reddit is. I think it’s kind of simple to say, ‘Oh, you can [use OpenBazaar] to build a Reddit,’ because there’s a lot more to building Reddit than [just writing the software].”
OpenBazaar is currently on version Beta 5.0 and Linux or OSX users may join by following the instructions included on their official repository, which can be found here.
