How Blockchain Can Impact the Gig Economy

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This is called “GIG Economy”. And it grows with incredible speed. Today, an estimated 34% of the US workforce is counted unlike traditional workers between the ages of 9 and 5, they are independent entrepreneurs. This figure is equivalent to about 4 million people, and it is estimated that 7.7 million will be reached by 2020.

Modern “dream work” is for many reasons not the workplace of our parents or grandparents. Today’s worker wants flexibility and technology have enabled professionals to work anywhere in the world and have customers everywhere. On the other hand, the employment of companies is no longer safe.

While an entrepreneur and a customer can agree on the scope of a project and a price, the freelancer is at the client’s mercy when the payment is due. It is estimated that freelancer loses an average of at least $6,000 a year due to a lack of customer payments. And the freelancer has little resources, especially if the amount owed is not worth the cost of a legal action. The customer is also at risk. Unethical, freelancer may delay the delivery of products or services until an additional fee is paid. Another problem faced by freelancers, especially when registering for independent websites, is the fees charged by these websites for each “GIG” that a freelancer receives. These can reach 15% to 20%. Even if a freelancer operates on popular websites and decides to use PayPal as a method of payment, there are still fees. 

How Blockchain Can Solve Freelancer Challenges

“The current changes in the economy are creating healthy, innovative and diversified business ecosystems. This is the beginning of a new economic era, and the old forms of money are slowly being replaced. What we can do is a plan for the long term, prepare for what is going to happen, and accept economic changes such as the rise in the Cryptocurrency.” said Dato, Sri Jessy Lai, CEO of Monspace Multinational Corp Group. 

The beauty of Blockchain is that it provides a permanent and distributive ledger that is unchanging and transparent. Although initially there was tied to Cryptocurrencies, its value has now been recognized in a large number of industries, where data security, contracts, and transactions are essential.

There are also clear benefits for the entire freelancer industry.

Best Payment Method For Both Parties

 

Blockchain was originally developed to support Cryptocurrencies and, in particular, as a secure method for financial transactions. Payments and cash transfers are recorded in blocks to a digital channel. The other benefit associated with Blockchain payments is the insignificant fees. And using Cryptocurrency allows you to pay without having to worry about exchanging fixed currencies when freelancer and clients live in different countries. Although shipping costs for traditional transactions can reach 20%, rates for Cryptocurrencies vary between 0.05 and 0.25%. Blockchain encrypts the agreement and the amount of the payment between the freelancer and customer, and the lower rates provided by the Cryptocurrency transactions benefit both the freelancer and the customer.

Proof of Work And Protection of Intellectual Assets

One of the problems that freelancer often face is the control of their work product and the evidence of the work they have actually done. All these data can be entered in a block with the profile of the freelancer, real working examples, positive customer feedback and so on. And if a freelancer needs to change or add things, typing in a new block is always an option. The other problem that Blockchain can solve is that of copyright and intellectual property. If a freelancer creates a particular work product, you may want to claim exclusive rights to that product or prove that the asset was created by him. Blockchain provides the perfect way to code the creation of this product, both in terms of what and when. Therefore, product developers have established and unchangeable property rights.

Smarter Contracts

One of the problems freelancers and clients face is the lack of secure contracts that can be changed in a traditional world by one of the unethical parties. And unfortunately, many “contracts” are written verbally or simply as offers or quotes. If a contractor and a customer agree on a work product, completion plans, and tariff amounts, that contract may be entered in a block in which it cannot be changed without the consent of both parties being added a new block. This eliminates most contractual disputes and ensures full transparency for both parties.

The concert industry is a prime example of an industry that is plagued by a number of risks. People may have great talents and abilities, but they fail for a variety of reasons: for example, they lack good business acumen or marketing skills. However, many risks are associated with fraud, contractual disputes, poor payment methods (high fees), and product and intellectual property issues. Blockchain provides a solution to all these problems and can be the alternative to legislative initiatives that take time to arrive.
 

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