Let's have a 5-way! Swapdom's peer-to-peer algorithm helps you trade stuff in a circle
Trading second-hand goods could be a very eco-friendly proposition. It has the potential to give another life to used items, without using the resources associated with producing new goods. The problem is that it's tough to find a good home for items you no longer need, just as it can be challenging to find used items that would be useful to you. We immediately see the benefits of common currencies, because It's rare that the person who had the item you want can use the item you have.
The website Swapdom is trying to solve these problems without reverting to a monetary system, using an algorithm that allows users to make swaps in a circle. Two-way swaps are possible on the site, but swaps have involved as many as nine people.
"If we can close the circles in this waltz, then everybody gets exactly what they want," said Petros Georgopoulos, who started Swapdom with his brother George. By moving from a two-way trade to the possibility circle, chances of closing the circles explode exponentially.
The service isn't entirely free to use. You'll have to pay shipping and a small fee built-in fee, which never exceeds $2.00.
Here's how it works. You post items you'd like to trade to your page. Then you can browse the items you would like. You click to request a trade, and offer the items you'd be willing to exchange. Then the Swapdom algorithm does its magic to figure out a circle where everyone gets an item they've requested.
This is definitely not instant-gratification shopping. The user experience is similar to an auctioning site like Ebay, where several users are in competition for the same item. However, Swapdom lets you not only propose several trades at once, but the algorithm will help you request several of the same type of item, even if you only want to end up with one of them.
For example, say I want a white sweater. Three different users on the Swapdom are offering sweaters I like. I can request all three sweaters in one trade, and Swapdom's algorithm will figure out how to make a swap so that I can get one white of the sweaters in exchange for one of the items I'm offering. If I also want to trade for a pair of red flats, the site will manage that trade separately from my sweater trade.
One of the big challenges for any service that relies on a social network is gaining enough users to give the service true value. It's not clear that Swapdom has reached that point since it's launch in October of 2013. Right now, about roughly 30 percent of proposed swaps are successful. However, as more people join and as current users add more items, not only will more swaps be successful but also the swaps can happen faster.
"What we're eventually trying to do is provide a general marketplace for previously owned goods," said Georgopoulos. They are planning to expand the categories to home goods, sports gear and even cars. However, they decided to test the concept with fashion and children's items first—two categories of items that are likely to still be in good condition and traded in high volumes.
"Kids items are high circulation, and it's not just kids clothes," he said, but also any items that have to do with kids, such as gear and toys. The only catch is that in order to make trades a better value, it's better if parents make bundles of items. "It makes more economic sense for everybody."
One of the particularly cool things about Swapdom is that it encourages people to not treat unwanted items as disposable, but rather to consider their intrinsic value. "We didn't want Swapdom to become a junk heap," said Georgopoulos. "It's not a market where people off-load stuff they don't want, it is a market where people use the stuff they don't want anymore practically like cash to get something they're interested in."
The algorithm that drives Swapdom also has potential for other uses. He cites the example of public housing in the United Kingdom, were people who want to move often face very long waits trying to trade with someone in their desired location. One can imagine large university housing offices being faced with similar problems.
"That's what excites me most," said Georgopoulos, "actually promoting this algorithm and helping people create peer-to-peer systems."