As a tech reporter for Belgium's business newspaper De Tijd, I'm fascinated by the coming wave of blockchain-powered crypto ventures that are challenging the well-known platform companies. In the same way that Steemit is offering an alternative to blogging and social media platforms, CryptoCribs is taking on Airbnb. Here's the translated version of my interview with founder Erasmus Elsner, which appeared earlier in de Tijd.
Nearly ten years after it was founded, Airbnb is still regarded by many as the disruptor of the hotel industry. But the platform for overnight stays should start to worry about its own future, as the next disruptive wave is already heading its way.
Although its current offering and fame are nowhere near that of Airbnb, the start-up company CryptoCribs is showing very fast growth, mainly within the crypto community and among travel fans. ‘In three months time we have listed around 800 accommodations, without spending one dollar on marketing’, says Swiss co-founder Erasmus Elsner. His company was recently selected as a resident in Paris’ brand new start-up campus Station F.
CryptoCribs’ website looks and feels like a somewhat less slick version of Airbnb, but the underlying technology and philosophy are very different. CryptoCribs is built on blockchain, the technology that allows for database management in a decentralized network. What this actually means, is that the community of users (hosts and guests) is the de facto owner of the database, and also has its say in the management of the platform. All payments on the platform are executed in digital cryptocurrencies such as bitcoin and ether.
‘I am a seasoned traveler and I got heavily involved in the crypto community. That’s how I got the idea of setting up a travel platform that is free of charges to be paid to an intermediary. Where Airbnb can charge up to 20 percent, we work with an initial fee of 5 percent. For each booking and with every positive review this fee is lowered by 0,2 percent.’ This means that intensive users can achieve free bookings after a certain time.
Elsner, who previously worked for investment banks JP Morgan, Rothschild and UBS, and who was a lawyer at a Swiss law firm, is the prototype of a young generation of idealistic ‘crypto-entrepreneurs’. Although his website is only three months old, he says he has already turned down a takeover offer and has received a proposal from a big hotel chain looking to offer its rooms through the platform. It’s a potentially very powerful deal, but Elsner insists that it’s up to the users to decide if they will allow it to happen.
Elsner concedes that his earlier investments in crypto currencies have earned him enough money to remain independent. But the huge swings in the values of bitcoin and other digital moneys also have negative side effects. ‘Most hosts are linking their bitcoin prices to fiat currencies such as dollar and euro, through an hourly update of the bitcoin price. As they only get paid 24 hours after the check-in, there is a window in which they incur an exchange risk. But most of them don’t mind as they are firm crypto believers.’
The founder doesn’t exclude the possibility of raising money by issuing his own currency or token. ‘But we’re now mainly focused on improving and growing the platform’, he says. ‘In the course of 2018 we’re hoping to reach a critical mass of a few hundred listings in big cities such as New York and San Francisco.’
The platform also got selected as one of the first apps to be featured in Toshi, which can be described as an app store for blockchain applications, launched by the well known cryptocoin company Coinbase.
In the long run, Elsner is hoping to perfect the concept of disintermediation – eliminating the middle men in all transactions – by means of smart technology. He cites the example of smart (connected) keys that are coupled to the rental contract. This opens the possibility of automatically linking the payment to the moment that a guest is entering the property.
For the original article (in Dutch):
https://www.tijd.be/tech-media/algemeen/Nieuwkomer-CryptoCribs-valt-Airbnb-aan-met-blockchain/9970131