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Companies like Uber and Airbnb pioneered the operator economy when they started delivering valuable services using crowdsourced infrastructure and labor. In the process, they proved that this relatively decentralized business model could compete with, and even outperform, traditional businesses. Today, the United States is home to more operating platforms than anywhere in the world, with apps for food delivery, haircuts, babysitters, car sharing, and many more. The U.S. operator economy has produced a stable of unicorns and is on track to be valued in the trillions by 2031. In a sense, the operator economy is becoming The Economy.
From the standpoint of market efficiency and social fairness, the operator economy is a failed experiment. Operator “ecosystems” are rife with monopolistic platforms, predatory pricing (subsidized by venture funds) and supported by an expanding underclass of economically precarious “gig” workers. Gig workers receive piecemeal wages and no overtime, are denied employee benefits like Social Security and health coverage, and must pay out-of-pocket to cover costs of doing their jobs. They are also subjected to various forms of wage theft or discrimination by opaque algorithms that orchestrate their work.
Building equity
Decentralized Physical Infrastructure, or DePIN, promises operator ecosystems that are both more efficient and more equitable. DePIN describes community-driven protocol networks that coordinate hardware-based services with tokens, and its underlying logic is as old as crypto itself. Bitcoin is the prototypical DePIN network allowing anyone in the world to contribute computing hardware towards securing an open distributed ledger in exchange for token rewards. This basic logic informs all subsequent DePIN networks.
Much like DeFi, DePIN’s leading economic benefit is that it dissolves rent-seeking intermediaries and re-distributes their rents to a range of stakeholders. Take Teleport, a DePIN ride hailing app. Teleport coordinates its ride hailing community using its protocol and token incentives, eliminating the need for any corporate, like Uber or Lyft. This returns extractive margins and fees back to drivers and riders in the form of higher wages and lower prices.
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