As a rapidly growing business sector, e-commerce continues to open up new avenues for exploring, comparing and purchasing products worldwide. Spl.yt, a smart contract protocol, aims improve the e-commerce system for buyers and sellers by automating functions currently performed by “middlemen” marketplaces like Amazon, eBay and Alibaba.
Such popular online platforms have no doubt transformed the way in which we shop and live. Access, convenience, low prices and the availability of a large selection of products are among the many benefits these platforms deliver to consumers. But such benefits provided by centralized corporations come at a cost — increased prices, process inefficiencies and aggressive marketing using huge amounts of personal data.
Research from “The Enterprise Guide to Global Ecommerce” projects a 246.15 percent increase in global e-commerce sales, from $ 1.3 trillion in 2014 to $ 4.5 trillion in 2021. And while Amazon alone accounts for almost half of that revenue, there remains a huge ocean of online opportunities for other businesses to share.
As the e-commerce landscape faces domination by the likes of established industry players, innovative approaches to buying and selling are experiencing roadblocks to advancement. Consumers are often subjected to lengthy searches of multiple product listings in order to assess availability and price favorability. Moreover, vendors, in varying their marketplace options, must keep their inventories current and prevent double selling to avoid taking a hit to their reputation.
Across this space, middlemen often capture high fees on all transactions, adversely impacting vendor revenues while leading to increased product costs for consumers. There is also a lack of mechanisms in place to support smaller e-commerce vendors in their product sales, particularly as it relates to fraud, spam and consumer dispute resolution.
The Promise of Blockchains
Blockchain technology is a game-changing solution that shows promise in the rapidly evolving e-commerce arena. At the heart of new advancements in this space is the Spl.yt Core Foundation, a blockchain-backed nonprofit operating out of Santa Monica, California. This startup aims to deliver a smart contract-based protocol that supports a new era of efficient, transparent and secure e-commerce systems.
Targeting those who sell, buy or facilitate purchases of retail items online, Spl.yt will help save time and money for this audience by removing middlemen functions and services by way of its decentralized e-commerce model.
Spl.yt’s capabilities include an automated global inventory system, fractional asset ownership and management, inter-marketplace reputation tracking, fair dispute resolution and automated affiliate marketing incentives. Driven by a global blockchain inventory, one that features tokenized incentives to foster honest, real transactions, those involved in buying and selling will experience Spl.yt’s fair and efficient e-commerce process.
According to co-founders Cyrus Taghehchian and Jason Civalleri, this forward-thinking approach from Spl.yt is meant to address a growing dissatisfaction with centralized services and organizations, including market manipulation and position exploitation, technical failure risks and high costs.
They say that by addressing the oligopolistic nature of the e-commerce world — one that robs smaller projects of opportunities — the growth potential for decentralized governance into financing and product development will be more fully realized.
“Any seller in e-commerce knows the biggest problem facing online retail right now is that the entire industry is controlled by a handful of corporate behemoths with unchecked economic power to set prices and standards,” said Civalleri. “These tech giants are essentially middlemen whose self-appointed role is to mediate transactions between buyers and sellers, yet consistently do so in a way that hurts small business while making everything more expensive for consumers. Not to mention the fact that they track consumers’ every move so they can use ads to better target their wallets.”
Igniting a New E-Commerce Normal
Civalleri and Taghehchian believe that today’s e-commerce ecosystem should be owned and operated by the actual buyers and sellers who make e-commerce possible, not middlemen corporations who make everything more difficult.
It’s here where the Spl.yt Core Foundation is developing the protocol to automate these functions in a decentralized way, with the ultimate goal of working themselves out of existence so that community members can run a truly decentralized e-commerce network while blocking the aforementioned behemoths from reemerging in the same harmful way.
“The existing e-commerce regime only benefits a few powerful middlemen at the top of the ‘food chain,’ so to speak,” said Taghehchian. “Ten years ago it was difficult to build an e-commerce website but easier to monetize. Today, it’s easy to build a website using templates but very hard to make profit due to the couple of online storefronts that own nearly 60 percent of the market share. We believe in a new e-commerce structure that is more egalitarian, instead of top-down.”
He reiterated that the goal is to empower all e-commerce players so that they can make a good living and earn rewards for their contributions to foster the health and growth of the entire e-commerce ecosystem.
The grand vision, said Taghehchian, is to introduce an open and global inventory system for product listings across marketplaces, saving buyers and sellers time and resources. Seller listings will be automatically updated across all Spl.yt connected marketplaces, with buyers only needing to search one platform to access accurate product availability and pricing.
He added that the Spl.yt protocol will also be used to incentivize affiliate marketers, such as social media influencers or even would-be-competitor marketplaces, to assist in the sale of a product. This will be achieved by issuing automated affiliate rewards to any party contributing to the sale of the item.
“The potential use cases for improving efficiency, transparency and security across the industry are as endless as our own imaginations,” Taghehchian said. “Our aim continues to be to open doors for innovative businesses and entrepreneurial individuals to achieve their potential using the capabilities enabled by the Spl.yt protocol. Our long-term vision is to keep moving toward a more decentralized future wherein the greater e-commerce ecosystem is owned and operated by people within a fair and automated network of participating parties.”
You can read the project “litepaper” here.
This promoted article originally appeared on Bitcoin Magazine.