Why cryptocurrency trading on OpenBazaar is a bigger deal than you might think
OpenBazaar launching a decentralized, peer-to-peer method for trading cryptocurrencies without assessing a fee is a big deal for multiple reasons. Reasons you may not think of without analyzing the possible effects or outcomes of this new feature. If you’re interested in learning what they may be, all you have to do is continue reading.
The very first reason as to why this is a big deal, is associated with how people currently trade cryptocurrencies with one another. That is, they currently use a centralized exchange to conduct their trades. There are two downfalls with this. One, fees are costly. As most exchanges charge a percentage of the transaction, fees can be very high if you’re trading with significant dollar values. One $10,000 Bitcoin swapped for Bitcoin Cash at 1% would equate to a $100 bill. With OpenBazaar’s new capability, that Benjamin doesn’t need to leave your wallet. The second downfall with exchange trading is the risk associated with keeping your assets on a centralized platform. Centralized exchanges present an existential threat to your holdings as the possibility of a hacker stealing from the exchange always exists. Getting “Gox’ed” is something you certainly want to avoid, and since this decentralized method of trading does not include OpenBazaar holding either party’s cryptocurrency, this threat is eliminated. Between the lack of fees and keeping coins in the hands of the their rightful owners, OpenBazaar created something that has improved the current way cryptocurrencies are exchanged for one another.
The second, and less obvious reason as to why this is a big deal, is this initiative should generate more usage of their platform. The lack of trading fees and the decentralized method of exchange should certainly attract users to OpenBazaar. In doing so, this should increase the number of people that use the platform for its primary purpose, which is to facilitate commerce using cryptocurrency as the method for payment. Quite simply, as people begin using the platform for crypto’s current primary use-case (trading/speculating), they will be more apt to use OpenBazaar for other things. Their comfortability with the platform will increase, and they will likely transition into using it for the purchasing of products within the marketplace - which also happens to be free.
This seems like a brilliant strategy for bringing new users to their platform, while also accelerating adoption and usage of cryptocurrencies as well. Over time, it will be interesting to see the effect this move has in terms of increased marketplace usage. Assuming an uptick in activity, it will also be interesting to see what cryptocurrency is most often used to facilitate the transactions from buyer to seller. OpenBazaar may become the central battleground in the fight between cryptocurrencies attempting to become an actual form of money. Time will tell; but the players are known, and in the end, the market will decide who wins. A beautiful outcome to this fee-less, decentralized trading experiment.
Thanks for reading.
Behind the paywall, you will find a brief writing entitled: "Why the current number of transactions does not matter"
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