In a recent talk delivered at the Latin American Bitcoin and Blockchain Conference in Chile, Andreas Antonopoulos shared his thoughts on black and white markets and the ability of “open blockchains” to deliver “justice as a service”.
Black and white markets
Andreas began his address by pointing out that calling a market ‘white’ or ‘black’ does not tell you much about what that market may do or how well it works.
He said that people who use such terms would really like you to think there are a whole set of moral associations that go along with the colour, stating:
“White markets are good, black markets are bad. White markets are legal, black markets are illegal. White markets are functional, black markets are dysfunctional. White markets are fair, black markets are unfair. White markets are safe, black markets are unsafe. White markets are moral, black markets are immoral.”
He finally proclaimed that not a single one of these statements is true, concluding: “Instead, white markets and black markets differ in only one essential component: white markets are licensed, black markets are unlicensed. That is it.”
Taxi cartel vs Uber
He stated that in his opinion, the taxi cartel operates as a white market while in many jurisdictions, Uber operates as a black market.
He told the story of how he had travelled to 53 countries and been robbed by taxi drivers in 52 of them. The “thefts” included things like taking longer routes, increased tariffs, and even the addition of several extra charges that he assumed were made up just to scam tourists.
“Because it is a regulated, licensed guild – a cartel – it is an inefficient, broken market, full of corruption. Uber works. It is efficient, fair, and transparent, but it is a black market.”
He thinks that people don’t often think of Uber as a black market because it is run by a multinational corporation with nice graphics and a ticker symbol on the stock market index.
“We don’t really want to call it the black market, but it is if it is not licensed.”
Justice as a service
He went on to say that open blockchains can now deliver “justice as a service” no matter what colour your market is.
“Let’s use tech terms: governments provided justice as a service (JaaS). Their justice as a service API is only available for a certain fee to certain people, and it is usually broken. It may take seven years or longer to fulfil the request; nevertheless, they offer justice as a service.”
He then went on to say that if you step outside of the white market, your access to justice as a service would be removed.
“You are exposed to the full risk of operating in a market where you have no justice services from them, where you have no recourse facilities, no ability to settle disputes, and violence becomes the only solution.”
Andreas made the case for a new potential market of open blockchain-based services that can now provide JaaS though smart contracts and multi-party global protocols to apply fair rules back into any market.
“Bitcoin doesn’t care. Ethereum doesn’t care. Open blockchains don’t see colours. They don’t see borders and they don’t see authorities. They only see rules,” he concluded.