In 1823 the British Shipowners Society proposed using 64 shares for the division of interest in ships to enable multiple ownership of vessels. Thus, merchant ships were commonly “fractionally” owned. The idea was later enshrined in the Merchant Shipping Act of 1854 and continues to this day.
WeOwnTheAirline is a new airline model based on long established practices in commercial shipping but employing blockchain and distributed ledger technology to enable Fractional Ownership of scheduled airliners.
• WeOwnTheAirline is an airline owned by its passengers.
• Each “airline” will be constituted as a “digital mutual”, under English law; a discretionary mutual.
• We define “airline” here as one new airliner dedicated to one scheduled route although multiple aircraft will fly many routes under the brand name “WeOwnTheAirline”. WeOwnTheAirline will operate on routes that exhibit a Pareto Principle.
• We expand upon the established fractional ownership model of business jets and apply its principles to scheduled airliners.
• Through the use of distributed ledger technology and Smart Contracts we enable Fractional Ownership of scheduled airliners by anybody at modest cost. The purpose is to provide to the owners of the shares in an airliner, scheduled air travel at cost price.
• We provide a mechanism whereby owners can tailor their airline to their own requirements and preferences. We facilitate the sale of their unused inventory — “save money (when flying) make money (when you’re not)”.
• We create a new class of financial primitives in DeFi that provide instant liquidity for shares in airliners, enhance the potential returns and provide unique opportunities for owners.
• We create the worlds first futures market for airline revenue (RASK).
• The distinguishing characteristic of a mutual is that the organisation is owned by, and run for, the benefit of its members, rather than being owned and controlled by outside investors.
• We differentiate from analogous aircraft fractional ownership schemes through the tokenisation of shares in an airliner. We introduce Decentralised Finance (DeFi) to the airline industry, provide a platform in regulatory compliance, that does not use a native crypto-currency, yet facilitates a liquid, secondary market in the shares of the aircraft with full subrogation.
• WeOwnTheAirline is a community based model as opposed to the standard adversarial one which arguably put shareholders interests before passengers’.
• WeOwnTheAirline is an airline rendered as a DAO : Decentralised Autonomous Organisation.
• WeOwnTheAirline acknowledges the airline seat is a commodity.
• For existing airlines we provide a source of BlockSeats where it would otherwise be uneconomic for them to implement air services or contract for ACMI.
• For institutional investors in aircraft we provide a mechanism for the disintermediation of airlines and we also open this asset class to the retail investor for the first time.
• WeOwnTheAirline is sui generis and adds a new acronym to the taxonomy of airlines: The “at cost carrier” or “@CC”.
In subsequent posts I will set the context for this new airline model, one in which anyone can own their own airline and provide details of the mechanisms that enable the model.
