How will Uber use blockchain?

Not until 2009, a major disruption happened in the taxi industry with the entry of Uber. Cab aggregator Uber started in the US city of San Francisco and now it has expanded its operation to many cities globally. Uber is proving cab rentals, bikes, carpooling, luxury cab services to attract customers. Uber so far has received millions of dollars as external funding. Similar to Uber there are many taxi giants like Lyft, Didi, GoJek, Ola operating in many cities. Despite all these, the cab companies suffer a major disadvantage of centralization. They connect providers with individuals in need of their services.

Why Uber is centralized?

All of the infrastructures including servers and software are owned by the cab companies and the mechanism for individuals to transact with one another is controlled by them. In the case of Uber, you submit your request for a vehicle on Uber’s app and your request is sent to the company. Then, they send a vehicle to you and you send them your money. Uber takes care of sending the money to the driver after taking some amount as commission. So, people end up giving a lot of money to the cab aggregators.

Three major problems are associated with this centralization

High fare due to the intervener

Transparency issues

Safety of riders and drivers

Using a decentralised blockchain architecture based on the advanced Chandra–Toueg consensus algorithm, Uber can now cut through the Byzantine complexity of booking a ride by “connecting drivers and passengers directly via instant P2P protocol.”

The Uber ecosystem works as follows:

1. Riders submit the ride request on Uber’s app and the company receives that request.

2. Following the user’s request, a vehicle and driver is assigned to the rider.

3. Riders complete the ride and they send payment to the company.

4. Uber sends money to the driver by cutting a specific percentage of the amount as the commission fees.

Therefore, we need a decentralized approach to overcome the above pain points in the current platforms.

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Created on Oct 16th 2019 07:58. Viewed 130 times.

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