Blockchain-Powered New Generation of Global B2B Platforms: A Conceptual Approach

Abstract

This paper lays out conceptual groundwork for the new generation of business-to-business (B2B) exchange platforms. Latest technological advances including blockchain, smart contracting, and digital currency force significant changes in the current state of the electronic commerce by offering solutions to numerous problems faced by B2B firms. We develop a conceptualization for the decentralized B2B platform that builds upon blockchain-related technological change. We show that the new B2B architecture can overcome frictions distorting the existing state of the B2B environment including:

(1) need for trust and relationship building for sustainability and survival,

(2) quality shirking,

(3) payment fraud,

(4) charge-backs,

(5) barriers to entry,

(6) post-sales disputes, and

(7) product recall.

An equally important aspect of our model is that the new generation of B2B platforms create substantial positive network externalities for the interconnected businesses globally. Overall, the proposed infrastructure should have positive revenue consequence for the B2B commerce worldwide, as well as positive externality value to the society at large.

Keywords: Blockchain, B2B Commerce, Smart Contracts, B2B Exchange, Cryptocurrency, B2B Platform, B2B Environment, Trust, Fraud, B2B Firm