Blockchain technology can be integrated into a global collaboration platform to make it secure, trustless, democratic, cheap, and uncensored.
But what is blockchain?
A blockchain is an open, decentralized, continuously growing, cryptographically coded chain that records any virtual transaction in a permanent and verifiable way. Each new transaction on a particular asset is recorded and encrypted as “block”. Once this transaction is complete, the block is added to the chronologically arranged chain of existing blocks. Blockchain applications are also decentralized, which means they operate on a peer-to-peer basis and does not have a centralized server, storage, or administration.The peer nodes in a network continuously communicate with each other and get synced.
Although the concept of blockchain came up in the early 1990s, it was brought to life in 2008 for building Bitcoin, the first cryptocurrency. Since then, this field has been developing. Blockchains are not limited to cryptocurrencies; there are several upcoming applications that work based on the same technology.
Applying blockchain to online collaborations
The disadvantages of existing global collaboration platforms can be solved by using smart contracts for implementation of terms and conditions (T&C), and by using cryptocurrencies for payment.
Let’s take look at the inherent characteristics of a blockchain-based system and how these help take care of the current problems.
Security and immutability: The decentralized nature of blockchain takes away the possibilities of a central point that can be targeted for cyber attack. It requires immense computing power to access all the nodes associated with a blockchain and alter them at the same time, thus making it practically impossible.
The records stored on a blockchain are cryptographically encoded. This can be accessed by a unique digital key assigned to everyone participating in a transaction. If a record is altered by anyone, the key immediately becomes invalid. This way the network nodes know there is an undesired activity, and can even track them down.
What it means: If the project owner/team member lies about a payment, you can check the digital record to find out the truth. If they try to alter the T&C in the smart contract you had signed, you would know. An outsider cannot get unauthorized access to your project or crack into your payment gateway.
Automation: Smart contracts are computer protocols that would automatically perform certain functions and ensure that the involved parties adhere to the T&C mentioned in these contracts. This avoids the chances of manual errors or fraudulent activities. All the monetary transactions are recorded on the blockchain and available to all the collaborators.
What it means: The project owner doesn’t have to manually make division of assets between the team members. The team member doesn’t have to keep reminding the project owner to send across the payments. All these are done by the system immediately when the agreed goals are achieved. There is no need to hire an accounting firm to keep record of the financial aspects.
Democracy and fairness: By implementing a resolution voting system, the collaborators have the option to vote on important decisions. These resolutions are recorded and made available to the collaborators of the project. The majority’s decision is automatically passed and obeyed by the smart contract. This prevents any kind of abuse in the decision-making process.
What it means: When disagreement arises between members regarding issues like treasury threshold, dilution of assets, transfer of intellectual properties (IPs) etc, these can be decided by having all the members vote on it. It is also possible to remove a poorly performing member by voting, while protecting the IP. The kicked out member would still receive a split of the payments the project receives until the time period mentioned in the smart contract ends. The percentage of this split depends on the amount vested until the day of the votekick.
Regulation and censorship: Traditionally, creating global collaborations involves complicated legal formalities. By hosting a project on a global collaboration platform, projects involving upto five members needn’t be registered as a company. Moreover, currently there are no government regulations on cryptocurrencies or tokens. You can’t be taxed for having a hundred ETH in your crypto wallet.
What it means: You don’t need to have a registered company and go through the legal process to work with someone from a different country. You wouldn’t have to show this income in your taxes either.
Cost: Since there are no financial institutions involved, you don’t have to pay a high fee for each transaction. With a decentralized system, the fee for each transaction can be reduced. If it is a cryptocurrency transaction, this goes directly into the crypto wallet of the member, the cut of third party payment gateways can also be avoided.
What it means: The overall cost of setting up a project, monthly rentals, transaction charges, and other official formalities are completely avoided or significantly reduced.
We, at Enkidu, are trying to build an effortless platform that connects freelancers and small businesses across the world and lets them collaborate on projects they are passionate about.
The presale of our initial coin offering (ICO) starts on March 12, 2018. Check out our website for more details.
