Meet Fermat. The new face of free markets.
Fermat is an open-source application platform which uses the blockchain and P2P technology. “At its very core,” Fermat
’s founder, Luis Fernando Molina, says, “Fermat is about freedom.
“The whole design orbits around the concept of users determining the level of privacy they prefer; whether they choose to have intermediaries or not; which currency they prefer to use and so on. Fermat was designed to empower an ‘Internet of People’ in contrast to a ‘Web of Companies’ and to advance the P2P era and economy.”
Fermat currently has over 60 full-time contributors working behind the scenes to create its envisioned “Internet of the People”: a marketplace free of central bankers, politicians, Flash Boys, and other market zombies.
Once finished, Fermat will, says the website, “allow anyone anywhere, to find, communicate and transact with anyone, anywhere, without unwanted third party involvement and privacy risks.”
“The project,” Jamie Redman writes on Bitcoin.com, “gives users sovereign ownership of their digital footprints. The network uses nodes that securely and autonomously communicate with each other. A token asset called Fermats that offer incentives for node operators and token transactions will be distributed over the Bitcoin network.”
“Beyond the obvious advantages to the developer community,” one of Fermat’s board of directors, Philip Farah, says, “Fermat will deliver significant benefits to end users and businesses. For end users, it will lower transaction costs for both buyers and sellers and give back user control over one’s personal information and digital content. For businesses, it will provide access to low cost digital marketing and distribution channels and a platform to deliver value-added services such as market research and insurance.”
We’ve talked about these marketplaces before in past episodes. And we’ll continue to talk about them. Why? Because the blockchain and other decentralized platforms are paving the way for a whole new definition of ‘free markets.’ And this idea — the thought of open, decentralized, peer-to-peer networks — is catching on.
“What is typically thought of as the peer-to-peer or sharing economy — think Uber or Airbnb — could someday,” Laura Shin writes in Forbes, “become so peer-to-peer that drivers and riders or hosts and guests connect to each other directly through their smart phones and ditch those companies as middlemen.”
“Today,” Molina chimes in, “the Internet is home to mega-corporations, governments, massive server farms and user surveillance.
“Our businesses, purchasing power, savings and personal data have become a playground for hackers, tech giants, marketers, bankers, politicians and other self-interested third parties to pilfer, mine, exploit and otherwise abuse at our expense.
“Bitcoin promised a better world,” Molina goes on. “Fermat seeks to deliver it. Through a widely adopted decentralized app framework that incentivizes collaborative development, shared ownership and hyper-customization of modular software, the Project aims to earn widespread mainstream adoption and unshackle free markets by removing middlemen from their current levels of influence.”
To be sure, these marketplaces aren’t some thought experiment for future generations to make real. They live today. They’re here. One early adopter, OpenBazaar, a decentralized peer-to-peer marketplace, just opened up its digital doors earlier this month. In fact, we’ve already opened our first store (for free) selling Fugio cent replicas.
Rather than taking the scenic route, OpenBazaar cuts a hole in the fence
With platforms like OpenBazaar and Fermat, the barriers to enter the market become a $200 laptop. (Or a library card.) And you keep what you earn. No questions asked.
This, of course, levels the playing field, enticing more competition to enter. And, with the money saved on transaction and middleman fees, goods and services can easily be traded more cheaply than in the centralized marketplace.
(And that — cheaper prices — is the only reason most would need to begin to adopt these markets. Think: Wal-Mart and Amazon.)
But decentralized marketplaces sound complex, right? Well, if you’re worried about a learning curve, don’t be. It would run with you in mind, just like our current online marketplace, except even more so. Ease of use is top of mind for Fermat’s developers. Along those lines, Fermat’s white paper, which was just released this week, reads:
Fermat’s central premise is that there is a path to software development that is smarter, better and more efficient than the status quo. The Fermat framework allows anyone from anywhere to collaborate and mutually profit from shared ownership of modular applications: it enables an open-ended stream of micropayments to authors of reusable software components that can be perpetually combined and recombined to create an ever-expanding library of useful, highly-customizable, peer-to-peer commercial applications.
Let’s take, for example, a company like Airbnb. Now, put that company on Fermat’s platform. What would that look like?
“In the peer-to-peer Fermat-powered version of Airbnb,” says Shin, “someone who wants to let a room would download the Fermat host version of the app and upload information about the room.
“People with Fermat’s guest version of the app who had appropriate search criteria would find the offering. Once a guest and host decide to make a deal, they chat through the app themselves, without having to use a middleman. And when payment is exchanged, they can use a currency like Bitcoin to transact directly with each other — sans bank or PayPal fees.
And it gets better. Fermat, as mentioned, gives users direct control and sovereignty of their personal information. Thus, their privacy is as tight as they want it to be.
“The blockchain-enabled system,” the white paper goes on, “is built to be user-controlled, censorship-resistant and flexible — a platform for person-to-person exchange of goods, services, assets and data, free from the whims, risks, costs and interference of unwanted, self-interested third parties who are no longer needed to facilitate the exchange.”
Let’s just hope these things are up and running before the dollar craps the bed. If so, we can just flush the parasites out with one go and keep on sailing.
If they can’t beat us, they’ll join us.
[Ed. note: Fermat’s white paper is at this link. Check it out, it’s interesting stuff.]
Managing editor, Laissez Faire Today
P.S. Have something to say? Say it! Chris@lfb.org.