Top Tips For Investing In Blockchain |
Posted: June 10, 2019 |
Before we examine investment opportunities in the world of blockchain, we need to have an overview of what blockchain represents and how the world is harnessing this technology. Some 3 decades ago, when the internet was just about getting introduced to the world, many people did not have a clue to what a modem was or how it would immensely help every facet of life or how the process of academic learning would be simplified. Today, we all know that internet has become an indispensable technology and the way we work, communicate and interact with multitude of people from around the globe. Blockchain For Novices Similar to the internet, in the 21st century, blockchain is relatively in its nascent state even in 2019. For novices, blockchain is the technology that drives crypto currencies like bitcoin. The Christmas season of 2017 sent bitcoin investors into a tizzy when every coin they had invested in, commanded a hefty price close to $20,000 mark. But the euphoria did not carry significantly into the New Year, and the second half of January 2018 saw bitcoin retracting steadily before it started falling like the proverbial 9 pins. Undoubtedly, other crypto currencies followed suit and investors lost billions of dollars. After this debacle in January 2018, the crypto currency markets struggled to recover and prices remained volatile with a negative bias. But, the crypto markets had lots to cheer in April 2019 with bitcoin beginning to move northward steadily and making some decent gains every single day over the next few months. As we write this bitcoin is trading around the $8,500 with un upward bias and could soon pierce the $10,000 barrier. Obviously, other crypto currencies will also gain, riding piggy back on the fortunes of bitcoin. www.blockchainaustralia.com.au is a leader in the blockchain space and is competent to guide you through the process of finding rewarding investment opportunities within the blockchain space. Blockchain Technology The ‘Block’ in Blockchain represents bits of digital information and have 3 parts comprised of transaction details, participants in the transaction, and information to distinguish itself from other blocks. Typically, a single block has the ability to store as much as 1 MB of data. A series of such blocks is called the Blockchain. To put the blockchain technology into context, it is the technology that drives most crypto currencies and was introduced to the world by the founders of bitcoin. Early on, blockchain was reckoned as a part of bitcoin or crypto currencies. But people started looking at bockchain technology differently giving rise to the likes of Ripple and Ethereum. Today, thousands of other enterprises and use cases have harness blockchain technology in different ways. Even the World Economic Forum has discussed blockchain as a priority topic and the past few years have seen about 4 million search results in Google for ‘blockchain’ as well as several thousand new publications. Blockchain Investments Blockchain has consequently attracted large investments with blockchain startups and Venture-capital funding growing consistently. Investments in ICOs or initial coin offerings which is an investment model specific to blockchain has gone through the roof hitting the $5 billion mark. IBM for instance has invested over $200 million in IoT powered by Blockchain with 1000+ people employed in the project. One of the major benefits that blockchain brings to a sea of commercial applications is significant cost reduction. Ripple has established this beyond doubt raising itself to be a serious disruptor in the cross-currency payment processing segment, not just in terms of cost of transactions, but also the time it takes for each transaction. Opposed to several days that the traditional systems consume, Ripple completes these transactions in under a minute. The smart contracts, initially from the stable of Ethereum is another Blockchain based offering that avid users have lapped up quickly. Immutability, meaning data once entered into a block and added to a chain cannot be tinkered with is heralded as one of the biggest advantages of blockchain. Further, every transaction in a blockchain is transparent adding to the desirability of the technology. Lately, even federal governments are taking blockchain seriously. The Australian government, for instance, has initiated significant measures to nurture the technology and announced a blockchain roadmap for the nation with a further boost to federal funding. Challenges Before Blockchain Investors When you look at the mainstream market, blockchain continues to be young and widespread deployment of solutions based on blockchain is yet to gain speed. Just a handful of companies have effective blockchain projects up and running. But, the blockchain profile is rising at a fast pace while the technical expertise necessary to create smart contracts and blockchain platforms is in acute short supply. Therefore, the short supply of necessary expertise is presently a stumbling block in the progress of blockchain technology. The big brothers in the IT industry or the financial industry can develop in-house abilities to fill this gap. This Side of the Grass is Greener But, on the other side, there is a huge group willing entrepreneurs and companies willing to harness the blokchain technology in their respective sphere of activity but cannot invest in dedicated divisions for blockchain technology or access knowledge and tools to build the actual solutions. If this is not enough, there is also a problem of plenty with multiple options and business owners do not know what would be best suited for them or where they should start. Independent businesses can thus develop these capabilities and then offer it to needy businesses and entrepreneurs. At first, the task may not be easy, since you would still need competent personnel to design and deliver bockchain based solutions to discerning customers. They may also need to focus on solutions that can be offered to multiple clients with little or no tweaking needed to customize the offering. But, once you build your enterprise, the path ahead should be smooth and juicy. Remember also that the enterprise you create should be significantly energy efficient. Traditional blockchain applications and solutions consume very high amount of energy. However, recent technology initiatives have addressed this concern to a large extent. Lending To Blockchain Developers Another business model that should be of interest to investors is lending to blockchain developers and companies engaged in doing this. Some of the more established names in the financial industry are already into this segment with loan offerings wherein a single loan could be as big as $200 million.
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