Beyond Uber: A Simple Way To Understand Blockchain And Crypto Posted on : Oct 10 - 2018

Most people don’t know the first thing about cryptocurrencies, except that their kids made, or more likely lost, money. There’s that guy in the office who’s really into Bitcoin, but otherwise, the only thing most people hear is billionaires like Warren Buffet and Jamie Dimon trashing the whole idea.

Of course, at the same time, those guys are investing heavily in blockchain, the technology that makes cryptos possible. Buffet’s own railway, Burlington Northern Santa Fe, is a major player as part of the Blockchain in Transportation Alliance (BiTA), which seeks to put order into the vast global freight complex using modern technologies for automation and transparent reporting via Blockchain. And Dimon may not think too much of cryptos, but JPMorgan has an extremely active blockchain department.

So how do these things coexist? Simple: crypto and blockchain are real.

Our company is developing a cryptocurrency, and since the concepts of blockchain and crypto are still so mysterious to many people, I used this analogy to illustrate how it works for our shareholders. Let's call this hypothetical example “Beyond Uber.”

Unlike cryptocurrencies, Uber has a well-known success story. With just a phone app and smart data systems for dispatch, Uber blew up the taxi industry, which, as a protected monopoly, was vulnerable.

Uber decentralized the model by enabling anyone to get into the business, and Uber became a verb. Now we don’t grab a cab to the airport, we don’t drive and park, we don’t rent a car; we Uber, because it’s cheaper and easier.

But Uber drivers, it turns out, don't make that much money. A ride that took 20-25 minutes of the driver’s time but only cost $5 doesn’t net much by the hour. Uber, on the other hand, is sitting pretty in the middle of it all, with a valuation of around $72 billion for basically providing a platform.

Now, let’s consider the same model using a cryptocurrency.

Let’s imagine a ride-hailing coin. Let’s call it RIDE. Being a crypto, it’s smart, it’s secure and it can’t be copied.

To get onto the RIDE network, all a driver has to do is access a suite of distributed decentralized applications (DApps): one to verify insurance, one for bonding, one for background checks, one for licensing, etc. These apps are provided by certified vendors. Once all these boxes are checked, the driver appears on the network as “available.” No human intervention required.

Then you've got the riders, who really just need a RIDE coin wallet. The rider appears instantly on the other end of the RIDE network and is matched with a driver automatically. No platform in the middle to take a huge slice of the profit, just a one-to-one transaction. And without a middleman to take big profits, the driver makes what riders will pay. It’s a super-efficient system.

You know, most people don't realize there's nobody in charge of Bitcoin. There's nobody in charge of any true cryptocurrency because, by their nature, they’re decentralized and set up with these self-managing rules and processes. Without a central authority, the rules run the game, and the players must abide by the rules in order to stay in it. Nothing personal. View More