An emerging technology of decentralized peer-to-peer markets, or also known as the sharing economy, have emerged as a platform that allows individuals to create microentrepreneurship and add value to the economy by creating small business opportunities and improving lives.
The Sharing Economy represents one of the most effective ways to lift many families out of poverty in many countries, enabling individuals to go beyond sharing information to an exchange of goods and services between individuals instead of from business to consumer.
We are now witnessing the emergence of an access-based economic model, built on distributed networks of connected individuals and communities without centralized institutions; by sharing or renting products and services of underutilised assets.
A decentralized platform will help all kinds of underused assets that remains to be discovered, while at the same time increasing the value of those assets and deliver greater value to both consumers and the asset owners. Average consumers will have access to new forms of renting or lending, directly from the owners with affordable rates, without need to own the asset. This practice also create meaningful sharing practices which will accelerate the social progress.
The effects of the sharing economy are positive in all kinds of innovative ways of making a living. In the sharing economy there will be beneficial effects to both parties. This results in market efficiency that bears a significant contribution to product improvement and business growth.
The sharing economy is particularly useful and important given the relatively high number of people that are currently unemployed or underemployed around the world.
The implementation of sharing & renting economy have been existed before the internet, but technology plays a critical role in building large-scale sharing communities because it has the ability to serve as a platform to connect people in ways impossible before and unlock underutilised assets which accelerated the growth of Sharing Economy. Here are a few killer-apps of sharing economy:
- Rental services: It refers to a condition when people pay for using assets they don’t actually own. Renting can be a great source of stable and secure income for most people in the economy. Rental-centered economies can have benefits over ownership-centred economies, generally when the users have exclusive private ownership of them.
- Crowdfunding: the practice of seeking financial support to fund a project or a charity by raising money from a large number of people; this includes a direct loan or capital raising.
- Peer-to-peer services: offering all kinds of underused assets directly by the owners.
How BANKEX Can Create a True Sharing Economy
The purpose of sharing economy is to create a truly decentralized, peer-to-peer sharing economy. A sharing economy will exist in any area of human lives, from tool sharing to property sharing.
Trust & Reputation Problem
The problem is there is no platform that can facilitate the sharing of all kinds of assets while maintaining the trust and cooperation of providers of the platforms. More than 20% of providers on a P2P platforms like Uber or AirBNB had serious inconsistencies in their licensing and identities, which leads to false sense of security to users and provide cover for people who should not be working with consumers.
BANKEX tries to solve the problem of under-utilization of real-world assets by providing a unique platform that brings together asset owners and users through a Proof-of-Assets protocol & Tokenization process, to issue a digital token backed by real world assets: house, car, office, paintings, etc.
BANKEX’s Proof of Asset has the ability to quickly and unambiguously measure characteristics that affect the quality or quantity of the assets. The ability to perform regular and real time audit of the asset significantly increases the quality of asset monitoring. It is a powerful competitive advantage compared to annual and costly evaluation by formal auditors.
Centralized & Higher Fees
Per March 2006, Airbnb takes a 3% service fee from the host for each reservation to cover the cost of processing the transaction. This fee is in addition to the 6–12% paid for guest service fees, to make it 9%-18% of the total transaction.
It is considered high by regular travellers especially business travellers who usually move from one place to another in a shorter period of time.
BANKEX wants to make sure that the asset owners and the token buyers of the assets could experience the maximum benefits through a decentralized blockchain technology. The Proof-of Asset protocol is transparent, understandable, as well as much faster and cheaper.
By solving the issue of liquidity, tokenization of assets gains the greatest value as being used for:
- Use the token as a method of payment for end-product. This function not only allows investing into the construction of a building and receiving return of investment and speculative gains from the asset. This token would also be able to be used as a method of payment for rent of space within the building.
- Use to own an asset by a large number of investors. This condition would allow the owner of a smart-asset to attract a lot of funds via placement on the BANKEX stock market. A classic example would be shared ownership of real estate, where every person only owns a part of the real estate.
Real World Example:
Jiang, lives in Beijing, China and currently in the need of money to cover his college tuition fees. Jeffrey doesn’t have a house and his part time job salary is only enough to pay the bills. The only asset that he owns is his 2016 Fuji Jari Bicycle (worth $1,800).
Jiang decides to use BANKEX platform to tokenize his favorite bicycle.
Using the technology of IoT movement & location sensors, BANKEX validates the bicycle and it’s current condition. Jiang will then need to upload all the legal papers regarding his status of ownership.
After the instant audit process, BANKEX will issue the tokens. Any interested parties can then purchase the tokens. The token holders can retain fractional ownership of the cycle in terms of usage, for example 1 token equal to 1 hour rental of the bicycle. The token’s value is backed by the revenue of bike-sharing.
So when any of the token holders visit Bejing and want to use Jiang’s bicycle, the tokens can be converted for flexible rental period of the bicycle. On the other side, Jiang can now pay his college tuitition fees without need to sell his bike.
Through collaborative economy, BANKEX creates new ways of sharing and improving life.