One of the business sectors that have thus far not really introduced blockchain technology is travel and tourism. Bitcoin was created, in part, to reduce the costs of transferring funds from A to B as banks typically charge a fee of 2% or 3%, and it was envisaged that this could be done much cheaper with blockchain technology. Until recently, bitcoin transactions were only cheaper than banks if the amount was relatively high but with the Lightning Network even buying a $2 coffee now only costs a few cents in fees.
If reducing the fees of 2 or 3% charged by banks was part of the reason for developing bitcoin why hasn’t it been used to reduce the 15 to 25% fees charged by online travel agents (OTA)? Some people are likely to stick with their regular OTA just as many keep banking at their high street bank. If travelers could save a large proportion of the commission charged by an OTA by booking a hotel room direct they are likely to embrace blockchain technology.
BookLocal has recently published a detailed prospectus on GitHub of how they plan to use smart contracts to book hotel rooms for travelers and slash the costs for travelers. They plan to act as the property management system (PMS), channel manager and payment processor, cutting out many of the groups currently taking a cut from the room rate. They are working on a minimum viable product (MVP), using a rentable token model (ERC-809) and then plan to roll it out more widely to independent hotels. The tokens will use the ethereum blockchain and fittingly the test phase will cover the Ethereum Hackathon event in Memphis May 18 -20, 2018.
The hackathon aims to bring together ethereum developers and business professionals in the following sectors:
- Supply chain
BookLocal has teamed up with Exchange Suites in Memphis to provide accommodation for delegates attending the hackathon. Delegates will be able to use the BookLocal dApp to reserve their room with the rentable token. They have produced a short Vimeo video which demonstrates the process including the mining of the token and independent verification of the booking with Etherscan. As with bitcoin technology, the ecosystem is not going to change overnight, but if all goes well at the event in Memphis, we can expect to see more and more hotels becoming available on the blockchain.
Financial analyst, smartphone app designer, technical writer, and crypto enthusiast. Blockchain verified graduate of MOOC 9, DFIN-511: Introduction to Digital Currencies, run by the University of Nicosia.