Forbes published the article 'Why Blockchain could kill Uber'. This leads one to ask the following question:
How can Uber innovate through the use of cryptoassets and Blockchain?
Here is my analysis:
Uber business: Globally providing mobility through app-based ride-hailing. Integrate Uber Eats.
Vision for future: To become a multi-modal company and create an eco-system that connects users to dock-less bikes, buses, car rentals, flying taxis, and self-driving cars.
Innovation through use of cryptoasset: Consider that Uber implements a ERC-20 token called ‘Ubercoin’ (cryptotoken) with integrated smart contracts on Ethereum blockchain (digital infrastructure). The crypto-ecosystem (community) consists of Uber (company), Uber users worldwide, drivers, payment service providers, allied businesses and regulators. This innovation is aimed to take Uber from Digital mobility platform to a new decentralised value network of mobility. To achieve the future vision of Uber, it needs to unleash the power of its global network by incentivising (using Ubercoin) growth of its crypto-ecosystem where distributed communities engage in a smart-contracts environment. This innovation will help Uber to integrate machines (which operate on code and smart contracts) into its ecosystem in the future when Artificial intelligence, Internet of things and Robotics integrates into its decentralised governance crypto-ecosystem ushering in an era of self-driving and flying taxis.
Characteristics of Ubercoin: It is a cryptotoken, essentially a payment token. It can be used as a means of exchange on Uber’s decentralized platform (underlying Ethereum blockchain). Ubercoin is part of application layer (unlike cryptocurrencies which are part of the protocol layer) and belongs to Uber, the company. It is a pre-mined token. The distributed consensus mechanism for transactions on its blockchain is hybrid of PoW and PoS. Here the Uber crypto-ecosystem consists of:
· Inner layer: Core Uber blockchain engineering/research team, distributed validators (with known identity implies private blockchain)
· Mid layer: Uber digital wallet
· Outer layer: allied service providers, and financial institutions.
Ubercoin and its associated ledger will interact with Uber’s current business structure by innovating in following existing processes using Blockchain technology:
· Digital billing with integrated payments app
· Identity verification of drivers – KYC documents on the blockchain
· Tracking system for lost items during ride-hailing
· Managing entire global fleet/logistics on blockchain
· User feedback/review on blockchain
· Insurance contracts for the taxi fleet providers
· Blockchain powered Corporate social responsibility/ Philanthropy platform
Ubercoin can incentivise community participants to grow the network and get rewarded in Ubercoin for:
· Car-pooling and ride sharing efforts.
· Referrals to friends is rewarded in Ubercoin.
· User can pay for Uber services globally using Ubercoin which is valid globally.
· Loyalty programs / Milestone points (say 5000 kms of cumulative journey)
· Rides for the 2.5 billion Unbanked people (who have mobile phones, but no bank accounts)
Uber can move from centralised digital platform structure to truly decentralized business structure with the use of Ubercoin and its crypto-ecosystem. The futuristic possibilities of this network are:
· Futuristic loyalty programs: Let users use Ubercoin by integrating rewards across their shopping (Ted Baker, Mango), grocery (Waitrose), travel (AirBnb, RyanAir), movie (Cineworld) experiences by inviting various industry companies to be part of common crypto-ecosystem. The key here is that each company may have its own cryptopayment token, hence the common crypto-ecosystem facilitates seamless exchange across these tokens in the background at market prevalent rates of exchange (cryptoasset prices are governed by power and depth of network)
· Augmented reality/AI rides: Car-pooling users can compete with each other in Blockchain-powered Games and split the fare based on game results.
· Capital raising activities: Once ICOs become regulated, MNC businesses will have option to raise capital for futuristic bets/projects using ICOs. Here Ubercoin can act as Utility/Asset token.
Challenges: Scalability, sustainability, interoperability, AML issues.
We are slowly and steadily moving towards a 'token economy of the future. It will be great to have your views on how businesses may shape up in the future. Thank you.
