Tag Archives: Bitcoin

Tech News

What is OpenBazaar?

OpenBazaar is an open source project to create a decentralized network for peer to peer commerce online—using Bitcoin—that has no fees and no restrictions.

Right now, online commerce means using centralized services. eBay, Amazon, and other big companies have restrictive policies and charge fees for listing and selling goods. They only accept forms of payment that cost both buyers and sellers money, such as credit cards or PayPal. They require personal information, which can lead to it being stolen or even sold to others. Buyers and sellers aren’t always free to exchange goods and services with each other, as companies restrict entire categories of trade.

OpenBazaar is a different approach to online commerce. It puts the power back in the users’ hands. Instead of buyers and sellers going through a centralized service, OpenBazaar connects them directly. Because there is no one in the middle of your transactions there are no fees, no restrictions, no accounts to create, and you only reveal the personal information that you choose.

openbazaartransaction_1024

How does OpenBazaar work?

Let’s say that you are looking to sell your old laptop. Using the OpenBazaar client (a program you download), you create a new product listing on your computer with details just like you would on any ecommerce site.. When you publish that listing, it is sent out to the distributed p2p network of other people using OpenBazaar. Anyone who searches for the keywords you’ve used—laptop, electronics, etc—will find your listing.

If you both agree to a price, the client creates a contract between you both with your digital signatures, and sends it to a third party called a moderator. These moderators are also folks on the OpenBazaar network—could be your neighbor or someone across the world—who the buyer and seller trust in case something goes wrong. The third party witnesses the contract and creates a multisignature Bitcoin account (multisig) that requires two of three people to agree before the Bitcoin can be released.

The buyer then sends the agreed upon amount to the multisig address. You get a notification saying the buyer has sent the funds, and you ship the laptop to them and mark that it has been shipped. The buyer receives it a few days later, and they mark it received, which releases the funds from multisig to you. You got your Bitcoin, the buyer got the laptop; no fees paid, no one stopped your trade, everyone’s happy.

What if something goes wrong?

As we all know, things don’t always go smoothly. What if you’re buying a certain book from a seller, you pay the multisig, and they ship you the wrong one, or it was in poorer condition than advertised, or they don’t even send a product at all?

This is where the third party comes in. Remember that a multisig requires two of three people to agree in order to move the Bitcoin. They control the third key to the multisig, so the funds will not move until either the buyer and seller work out an arrangement themselves, or the third party agrees with either the buyer or seller on how to deal with the transaction and funds in multisig.

These steps may sound complicated, but the details are handled by the client itself. Our goal is for buyers and sellers to have an even better experience using OpenBazaar than the old centralized platforms.

Timeline

OpenBazaar version 1.0 has been released, and you can download it here. If you want to keep up to date on announcements and releases, please subscribe to our subreddit.

Submit bug reports and suggestions for improvement to our Github repositories, either server or client.

Feel free to drop into our Slack room. We’re happy to help you get a node running or answer your questions.

Developers can visit our developer resource page. Obviously any code submitted to the project is much appreciated!

You can also donate Bitcoin to this address to help us pay for seed servers, the website, and other projects costs like conferences.

Let’s make trade free, together.

Tech News

Central Bankers Raise Bitcoin Policy Questions

Commonwealth central bank governors say they want to look more closely into the impact of digital currencies on monetary policy before adopting a stance toward the technology.

The comments came earlier this week during a meeting of about 30 central bank governors from the Commonwealth – an intergovernmental organization composed of 53 member-states. Held on 6th October and chaired by Bangladesh Central Bank governor Aitur Rahman, the event centered on bitcoin in the context of global remittances.

Commonwealth of Nations

Government ministers and other officials were also in attendance.

The topic of digital currencies and cross-border payments served as part of a broader conversation about the negative impact of regulation on remittances, particularly the closure of accounts for money-related businesses that banks deem too risky to work with.

Many startups working in the digital currency industry today, even in countries with more advanced understandings of the technology like Australia and the US, continue to struggle to gain access to even basic banking services.

The meeting was intended to look at “the potential of virtual currencies to decrease costs and improve the efficiency of transfers” and included a presentation by London School of Economics historian and CoinDesk contributor Garrick Hileman on the state of digital currencies.

While the potential for digital currencies to address remittance pain points was acknowledged by those in attendance, some governors at the meeting raised questions “about the implications for monetary policy and financial stability”, according to the Commonwealth Secretariat.

Jwala Rambarran, central bank governor for Trinidad and Tobago was quoted by the Commonwealth Secretariat as saying:

“The Commonwealth Secretariat has a key role to play in sharing knowledge and developing research on the potential and implications of this new technology. If we decide to regulate virtual currencies, we are unaware of the financial instability risks posed by this currency. This is an area we need to determine carefully.”

During the meeting, representatives also discussed best practices for describing the technology.

Hileman characterized the meeting as a positive one, telling CoinDesk:

“There was significant interest shown by many Commonwealth member countries in the potential of cryptocurrencies to have a positive impact on reducing costs and other inefficiencies in traditional remittance services.”