Blockchain technology has made a big splash as a futuristic technology in recent years but it may also be the key to revitalizing past business models. Homestays are a traditional form of travel accommodation that allow for a deeper cultural experience than a hotel. Homesharing marketplaces like Airbnb have upended the hotel industry and become the dominant portal for something approximating a homestay. However, the powerful algorithms and platform restrictions of Airbnb have led to a race to the bottom in terms of price and cultural education has often become an afterthought. Traditional homestay companies now have to compete with this corporate giant.

Kozaza, a local leader in homesharing, is one such company. They have been in business for over 6 years, predating Airbnb in South Korea, but have acutely felt the effects of sharing a market with them. Dr. SanKu Jo, Kozaza’s founder and head of the Korean Sharing Economy Association, laments that homestays in the traditional Korean Hanok (한옥), a form of house first developed in the 14th century, have been largely ignored by the Airbnb platform. Dr. Jo views Hanoks as precious spaces and priceless cultural objects that should be shared with travelers and future generations.

Kozaza boasts a network of about 1,000 Hanoks and an impressive list of partners. They have been designated as a Sharing Startup since 2013 by the Seoul Metropolitan Government, received matching funding from the Korean government, and worked with the Seoul Tourism Organization and the Visit Korea Committee. Kozaza has also worked to place its network of Hanoks and other listings on Tripping.com and Tujia.com. Google’s Eric Schmidt is even a backer and Kozaza collaborated with the Google Cultural Institute on several projects.

Dr. SanKu Jo and Eric Schmidt, CEO of Google

One key partnership that may give Kozaza a competitive advantage against Airbnb is their partnership with Origin Protocol, a blockchain company based in San Francisco. Kozaza is working together with Origin on building their WEHOME platform on the blockchain. They aim to build a platform owned by the hosts and guests, not by monopolistic middlemen. Origin Protocol is creating the software underpinning what they see as the next phase in the sharing economy. Their tech will allow for true peer-to-peer marketplaces — cutting out oppressive middlemen — via decentralized marketplace applications. Because these applications will be based on the blockchain, a decentralized public ledger, companies of all sizes will easily be able to share data and tap into the network effects that companies like Airbnb have locked competitors out of in the past.

Blockchain technology has given companies the power to build entire decentralized communities that can compete with the incumbent giants like Airbnb. Origin Protocol is a platform and an ecosystem that is empowering companies like to ours to embrace decentralization and tap into a community of projects and resources that give us the tools we need to be successful.

— Dr. SanKu Jo, founder and CEO of Kozaza

Origin Protocol envisions a future in which highly localized and specialized marketplaces will have the same advantages as giant players like Airbnb — a huge pool of users and their data, a beautiful user experience, a global presence, and access to customer service and insurance markets. Identity, reputation, and accounts will be portable and the platform rules will be open source and regulated by the community instead of by corporate rulers. Blockchain technology will cut down on overhead and fraud, something that is a big problem for Airbnb. Cryptocurrencies make payments more efficient, faster, and instantly global. Cryptocurrency tokens can also be programmed with incentives that promote positive behavior and punish negative behavior as well as a way to give users a stake in the growth of the network.

Kozaza and Origin Protocol may be taking on sharing economy giants, but these giants were one plucky startups evangelizing about big, new ideas. Armed with blockchain technology and the mantra of decentralization, Kozaza and Origin are primed to disrupt the one-time disrupters.

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