How does The Block work?

As a decentralized marketplace, The Block has no central server, no middlemen, and works fully encrypted. Nevertheless, this doesn´t mean that at BitBoost we didn´t carefully design the whole solution. Buyer and sellers need a supportive environment, where they can trade with confidence, and also a scalable one, so the most people can be included for the whole benefit. In other words, we have designed a simple yet effective ecosystem over the Ethereum Blockchain, where buyers and sellers can interact in a reliable and trustworthy manner, without restrictions. Basically, we have designed and ecosystem with four main figures: Buyers, sellers, arbiters, and third party providers. Let´s examine all them in detail.

Buyers at The Block

The buyers are the people willing to buy whatever they want from any of The Block sellers. Buyers can easily create an account, with full privacy, and they can pay with Ether, the “gas” powering the Ethereum blockchain. For this purpose, The Block includes an internal wallet for the ether. This wallet can be funded either from an external wallet, such as MyEtherWallet, or via Shapeshift, already included within The Block interface. We are already working on a solution for converting national currencies such as US dollars and euros directly into ether, as well as support for multiple wallets. Our main goal here is to make The Block as easy as we can for both cryptocurrencies and fiat payments, so everyone can use the currencies of their choice.

Sellers and arbiters at The Block

Sellers are those people who want to sell whatever they want through The Block. In this case, making an account is as simple as for buyers. In the future, we are planning to allow users to select their own alias within The Block, a string of characters and even an Ethereum address (customization for sellers pages is also on the roadmap). Every seller pays one dollar in BTT (Bitboost token) for every listing. This will be the only fee required to use The Block, and goes to support BitBoost financial expenses. This fee is far less than other marketplaces, and the reason is simple: we don´t require central servers and big IT infrastructures to run The Block. The Ethereum blockchain provides the whole system with the computational power needed. Nevertheless, we will develop new features, support our users and promote The Block to make it as big as possible. These minimal fees will be our financial fuel to do that.

Moreover,  we already have a reputation system, both for sellers and buyers. This is most needed, since marketplaces are based on trust, and reputational systems are great for this. However, sometimes there will be problems, so we have developed a new solution for disputes resolution, one great concern for buyers on marketplaces.

For this purpose, regular centralized marketplaces offer escrow systems, but it is not possible for The Block, since we are fully decentralized, to deliver the same service. Therefore, we have developed a new approach to escrow, fully decentralized and community-based, with the arbiters at its center. These are users who offer themselves to resolve disputes within The Block, and get paid for it. The system is easy: a seller may choose the option of arbitration in an item listing, even selecting the arbiter himself. In this case, the payment for the item is held in an escrow contract and will be only released to the seller if both parties indicate they are satisfied, or if a given period of time has passed without any complaint from the buyer. If there is some kind of dispute, the designated arbiter will be in charge of the escrowed funds, and determine to whom they should go.  When required, the session key can be shared with the arbiter so that he or she can access the encrypted communications between buyers and sellers. He may require a fee for this service, paid by the seller. Of course, arbiters do have a reputational system, so the community can filter the best ones and discard those with a record of bad behavior, and the fact that sellers are paying for escrowing is a real incentive for good practices.

Third party services at The Block

The last figure in this ecosystem is third party services. These are the people involved in the purchasing process, delivering services such as fulfillment and marketing. Arbiters should be also included within this group, but they are so important for the whole ecosystem that probably shouldn´t be considered as third-parties. Anyway, in this group, we can include several services, already crafted within The Block like ShapeShift, or partners such as PassLfix. Our plan is to choose all those third party providers that will add value to both buyers and sellers (so maybe you would like to drop us a line, just in case you want to be one of them). Third party providers will be paid both in ether and fiat, with a 15% fee to The Block team, in order to craft and support their integration into the marketplace.

This is basically the ecosystem we have created. Obviously, it is not a closed one. Once we are online, users will make The Block whatever they want, and we will closely work with them to fulfill their needs. We are at the beginning of a new era of blockchain-based e-commerce platforms, and nobody knows how it will be. We can make some predictions but anyway, the result will come from the demands of the community, not from our personal interest at BitBoost. A decentralized system should be like that and at BitBoost, we are facilitators, neither owners nor rulers. We won´t be the next feudal platform lord of the Internet!

(If you think the people you know would find this useful, please share it with them – We’d really appreciate it!)