- Smart contracts will overhaul existing business models
- Flexible workspaces are the perfect testbed for smart contracts, as these could incentivise coworking members to help out in the space
- The contracts also have the potential to encourage peer-to-peer interactions and innovation
We’ve all been there. You go to the kitchen in your coworking space, the sink is full, the dishwasher is full, the bin is overflowing, and there’s not a clean teaspoon in sight. But what if you could incentivise your coworkers to clean up with a smart contract?
That’s just one of the (more random) applications that blockchain (the technology sitting behind cryptocurrencies) could unleash. We’ll look more into the impact of blockchain on the world of work later. But first, what is blockchain?
Blockchain works like a shared ledger, allowing you to store and manage data. Instead of your information being held in one primary location (for example, one data centre) it is distributed across many nodes across a computer network.
It’s similar to the differences between an old-school Word doc and an online Google doc. With a Word doc, there is one central depository of information (your computer hard drive). You have to share this one document with multiple team members, who have to wait for one person to complete their edits before the next person does. That’s how a traditional database works – you cannot change the same record at the same time.
A Google doc, however, lets the entire team make changes concurrently and everyone has access to the most up-to-date version of your document.
Blockchain is the equivalent to the Google doc. Blockchain is also independent from any centralised authority, cheaper to use, more secure, highly transparent and allows for the faster processing of information compared to conventional means.
As a result, blockchain is a great way to transfer money and receive a product or service, which makes it the perfect technology to enable smart contracts.
What are smart contracts?
Smart contracts allow you to exchange money, products or anything of value in a transparent way, without using a middleman. In effect, smart contracts automatically perform some actions when some other predefined conditions occur.
Explained one way: “If blockchains give us distributed trustworthy storage, then smart contracts give us distributed trustworthy calculations.“
So, let’s say you empty that overflowing dishwasher at your coworking space. You take a before and after shot of the machine to prove you’ve done the deed and upload it to an app.
Sitting behind the app is some logic (computer code). This logic is stored and replicated on a distributed storage platform (such as Blockchain) before it is run by a network of computers that agree, yes, you did empty the dishwasher. So, your account gets credited with a slither of a Bitcoin (or maybe a community cryptocurrency) almost instantaneously and the ledger is updated to show your work.
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The opportunities within shared workspaces are intriguing and could breed a new generation of coworkers who are incentivised to do some social good (for a little financial reward).
But the applications go way beyond keeping your kitchen clean. Once the technology matures, smart contracts will allow two mutual strangers to safely exchange goods or services.
Within a shared work environment, smart contracts could enable the collaborative ownership and usage of machinery, such as a 3D printer or the tools often found in makerspaces. A smart contract could determine whether an individual can use the 3D printer to carry out certain tasks based on their skills and community credits. Similar logic could be applied to give certain individuals access to specific areas of a shared space.
The implications are far reaching in a not-so-far distant future for the world’s unicorns. A smart contract between a property owner and tenant could, for example, completely negate the need for AirBnB. You could use smart contracts to pay for a taxi ride in a driverless car, which could signal the end for Uber’s main revenue stream.
However, while research house Gartner predicts more than one-quarter of organisations will use smart contracts by 2022, it also notes the lack of regulation and testing makes smart contracts a potential vulnerability in a business environment.
We still have a long way to go, but the smart contract market is maturing and the benefits are substantial in terms of time and cost savings. For example, consultancy firm Accenture estimates blockchain-based technologies could save the world’s largest investment banks between $8 and $12 billion a year by 2025.
While many early smart contract applications are being launched in the financial sector, the community-driven mindset of many flexible workspaces makes them the perfect testbed for smart contracts. Both encourage peer-to-peer interactions and innovation. As a result, flexible workspaces could have the most to gain from smart contracts.
Suggested reading about disruptive technology in the workplace