OpenBazaar: Blazing The Trail For Bitcoin Commerce Without Barriers

July 22, 2014 12:00 UTC

Described as the “BitTorrent of eCommerce”, OpenBazaar is a fork of DarkMarket. Like it’s predecessor, OpenBazaar is an open source proof-of-concept decentralized marketplace that aims to be highly censorship resistant. OpenBazaar leverages the Bitcoin protocol as the means to accomplish this via peer-to-peer nodes loosely based on Kademlia.

What’s more, is that there will be no fees involved to trade within the OpenBazaar marketplace; whereby allowing sellers to escape the restrictiveness and unheavenly fees imposed by eBay.

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OpenBazaar Ricardian Contracts

Another intriguing aspect that separates OpenBazaar from other similar solutions in development is that literally any web site can essentially become an OpenBazaar marketplace, by the way of Ricardian Contracts.

These extremely compact contracts (~4 kb file) can be sent to and/or downloaded from anywhere. Once downloaded, they can then imported into the OpenBazaar client, which takes it from there. To the greatest extent possible, the idea behind this is to empower sellers by not restricting them to a specific commercial site platform.

In this regard, OpenBazaar effectually becomes a distributed network very similar to BitTorrent; except distributing contracts as the file type. Ricardian Contracts for physical goods will also be supported, as well as user-definable custom data fields that either the OpenBazaar client or a custom app can parse.

Because OpenBazaar uses Ricardian Contracts to manage trades, potential support for autonomous agents is certainly feasible. Similar to autonomous Open Transactions Nyms, these autonomous agents could:

  • Write OpenBazaar contracts,
  • Digitally sign and issue them on on the OpenBazaar marketplace,
  • Search for and accept contracts that suit their needs,
  • And enter into trades on their own.

OpenBazaar Security & Privacy

The OpenBazaar Dev Team is proactively implementing a robust combination of anti-fraud measures such as multisig/voting pools, arbitration, surety bonds, good performance bonds, as well as other highly desirable risk-mitigation technologies.

A few examples include:

  • Encrypted Messaging: Encrypted messaging will be included in OpenBazaar, as well as the ability to place secure communication data (i.e. GPG key, Bitmessage address, etc.) on a seller’s store page if they prefer out-of-band chatting.
  • Contract Encryption: Contracts can be encrypted via the recipient’s public key to preserve privacy . Moreover, if there’s a MiTM attack, any contract modifications will be immediately detectable by the recipient when the OpenBazaar client performs a routine check of a contract’s digital signature; whereby checking to see if the contract public key matches the public key of the sender Nym.
  • Multisig Arbitration: Because OpenBazaar uses Bitcoin multisig, an arbiter can control the distribution of funds without ever being able to pilfer them. Mediation only happens if there’s a dispute between the buyer and seller; consequently, buyer protection fees are only paid if mediation is needed.
  • Protection Against Sybil Attacks: To help combat against sybil/sock puppet attacks on the OpenBazaar marketplace, an optional user-definable artificial cost for identity creation will be implemented via two options: proof-of-burn and timelocking.

Timelocking is where a specified amount of Bitcoin remains unavailable for a certain amount of time; during which your Nym identity remains valid. You will then be able to redeem the money once this amount of time has passed.

Proof-of-burn is where the creation of a Nym corresponds to the provable destruction (i.e. “burning”) of Bitcoin; specific to that particular Nym. The term “burning” bitcoins is somewhat of a misnomer, as it’s actually a donation to every other Bitcoin holder in the world. In the case of timelocking, the duration of the timelock is publicly visible.

However, in both cases the amount burned or timelocked is publicly visible. These parameters then can be applied to determining buyer/seller trustworthiness. Naturally, this will put a higher value on Nyms that choose the proof-of-burn model.

Another exciting feature of OpenBazaar is the ability to add keywords to your listings; searchable across the entire network, as well as the ability to filter out specific search terms. The likely direction OpenBazaar will be going, is to encrypt listings for storage. This has the added benefit of helping insure users against certain types of heinous events, such as child porn haphazardly ending up on their hard drive.

For more information: OpenBazaar.org

Photo via KamrenB Photography/Flickr (CC BY 2.0) and Shutterstock.

Last modified: July 22, 2014 12:06 UTC

More of: OpenBazaar

Mark M. Bravura is a freelance writer, entrepreneur and passionate advocate of bitcoin and it's related altcoin innovations. When not writing, he likes to search the interwebs for exciting new breakthroughs and projects within the bitcoin ecosystem.